California is a community property state, which means the courts will split a couple’s marital (or community) property equally. This equal split is in terms of the value of the assets, not a literal split of assets. In other words, if one spouse were to keep the house in a divorce, the other would receive other marital property of equal value to the house. That said, disclosing all marital property is crucial to ensuring this process is carried out in a way that is fair to both parties.
During a divorce, some people decide to hide assets from their spouse and the court. If you suspect your spouse may be attempting to hide assets, make sure you know what to look for, and learn more about the potential legal penalties.
How Assets Are Typically Hidden
In a divorce, people try to hide assets in a variety of ways. When concealing assets, people may:
- Open a private P.O. box.
- Overpay on certain debts.
- Move money out of joint accounts.
- Purchase expensive items.
- Pay new, unknown debts.
- Change shared account passwords.
- Transfer property ownership to family or friends.
In some instances, a forensic accountant or hired investigator can help people discover hidden assets. However, in simpler cases, individuals may be able to collect the evidence themselves. To uncover hidden assets, people can review the following documents:
- Tax returns
- Bank statements and bills
- Receipts of recent or past purchases
It is also possible to ask friends, co-workers, or family members for statements about the suspected hidden assets.
Consequences of Hiding Assets in a Divorce
Concealing assets is not only wrong but is also illegal. If someone willfully refuses to disclose or misrepresent their assets, they can face penalties such as:
- Alienation within the court. Judges nor attorneys appreciate being misled. After the discovery of hidden assets, a person can lose the trust of the court and their attorney may resign themselves from the case.
- Perjury (and in rare cases, fraud) charges. Perjury charges carry severe penalties of their own (i.e., jail time and/or fines).
- Financial consequences. Not only may the guilty party be asked to pay their partner’s legal fees, but they will likely also have to forfeit the entire value of the hidden asset.
How An Attorney Can Help
If your spouse is discovered hiding assets, they can be penalized whether you discover the assets during or after the divorce process. If you suspect your spouse is hiding assets, you should immediately contact an attorney. They will be able to help you gather evidence, connect with investigators, and file the necessary motions.
At TRABOLSI | LEVY | GABBARD LLP, our clients come first. With over a century of combined experience, our legal team is prepared to help you navigate the legalities of your divorce. To talk with a reliable attorney, call our office at (310) 455-8364 or reach out online.