Is your soon-to-be-ex concealing assets during a Florida divorce?
In today’s post, we continue our consideration of the phenomenon of a divorcing party hiding or transferring assets out of reach or knowledge of the other spouse to avoid sharing it in the divorce settlement or order. In part 1, we talked about what might arouse suspicion of this deceptive behavior.
Common ways spouses conceal money and property
While it seems shocking, this behavior is not uncommon and lawyers and other professionals have seen certain techniques used time and again. For example, these patterns are potentially fraudulent:
- Setting up trusts to which the other spouse does not have awareness or access
- Creating false debts to a third party – often a friend or relative – that the other spouse can “pay” with the understanding the other party will return the money after the divorce
- Buying assets abroad and keeping them there, or placing U.S. assets into offshore accounts or locations that are hard to discover
- Buying gifts for or giving assets as gifts to third parties
- Putting assets into the children’s names
- Using marital assets to support a relationship outside the marriage
- Failing to disclose in the divorce proceeding obscure assets of which the spouse may not be aware like business interests, stock options, executive perks, real estate, cryptocurrency, complex financial investments and others
- Purchasing items of value and hiding them or concealing cash
- Having third parties or shell companies hold assets until after the divorce
- And other techniques
What discovery tools and mechanisms do legal counsel use?
A divorce lawyer, working with other experts, will use particular techniques to try to piece together the full picture of marital assets and uncover dishonest dissipation:
- Lifestyle analysis: Careful cataloging of expenditures the couple made when married as compared with the income and assets the other spouse now claims may show a disconnect that suggests the lifestyle could not have been supported at the asset and income levels claimed by the other spouse, suggesting that not all assets have been disclosed.
- Tax return review: Evidence of fraudulent concealment may be present in the fine details of a tax return or in comparison of returns from different years.
- Important document review: Evidence of hidden assets may be found in financial statements, mortgage closing documents and other, similar documents.
- And other techniques
How do you get a fair settlement if your spouse dissipated assets?
If hidden assets come to light during the divorce proceeding, the other spouse may feel forced or may be willing to disclose details of the hidden wealth. If the assets are gone, the court may take the dishonest spouse’s behavior into account when equitably dividing the marital assets. In fact, Florida statute says that in making an equitable distribution, the judge first assumes an equal split is appropriate unless they can justify unequal division based on all relevant factors, including those in a long list.
On that list is “intentional dissipation, waste, depletion, or destruction of marital assets after filing of the petition or within two years prior to the filing of the [divorce] petition.” Courts have relied on this factor to give more marital assets to the innocent spouse to make up for what the other spouse wasted, spent or gave away.