A U.S. News and World Report survey in 2022 revealed that 30% of couples deal with financial infidelity, which is hiding financial debts and transactions from a spouse. Such behaviors are more rampant during a divorce when it comes to property division matters.
Being aware of potential signs your spouse is concealing assets can help ensure a fair and equitable division of property.
Sudden financial changes
One red flag that your spouse may be hiding assets is a sudden and unexplained change in their financial behavior. This could include diverting funds to secret accounts, transferring property to family or friends or making large, unexplained purchases.
Missing or incomplete financial documentation
If your spouse becomes evasive or uncooperative when you request financial documents, such as bank statements, tax returns or investment records, it may indicate they have something to hide.
Undervalued or overvalued assets
Keep an eye out for discrepancies in the reported value of assets. This could involve undervaluing properties, businesses or investments to reduce the share of the marital estate or overvaluing debts to minimize assets.
The use of cash can make it more challenging to trace financial transactions. If your spouse is regularly withdrawing large sums of cash or making undocumented cash transactions, it may be an attempt to conceal assets.
Overly complex financial arrangements
The introduction of complex financial arrangements, such as offshore accounts, trusts or investments in opaque entities, can be an indicator of an attempt to hide assets.
Deferring compensation or bonuses
If your spouse has the ability to defer compensation, bonuses or stock options until after the divorce, it may be a tactic he or she uses to reduce the marital assets subject to division.
Transfer of assets to others
Watch for any unusual transfers of assets or property to family members, friends or business associates, especially if these individuals have no apparent legitimate claim to the assets.
Sudden reduction in lifestyle
If your spouse suddenly reduces his or her standard of living, it may be a ploy to create the appearance that his or her financial means are not as lucrative as they actually are.
Mysterious debt accumulation
The sudden and unexplained accumulation of debt can be a tactic to offset assets. The court may consider debt a liability during property division.
It is important to remember that while these indicators may raise suspicions, they do not necessarily prove that your spouse is hiding assets. If you suspect foul play, do your research to uncover the truth.