Is Your Spouse Hiding Assets From You?
Nobody wants to think about their spouse hiding assets from them during their divorce. Unfortunately, that doesn’t mean that it never happens among couples or that spouses don’t try to hide assets from one another.
When Spouses Hide Assets During a Divorce
Sometimes during a marriage, one spouse controls and/or manages the bulk of the financial resources of the couple. As a result, it’s common for the other spouse not to know all of the assets or any of their values. Meanwhile, the spouse with financial control may be aware that most of the assets acquired during the marriage are considered marital property. And in Minnesota, judges are required by law to split all marital property “fairly and equitably” in a divorce. This often means a 50-50 division. Therefore, worst case scenario, the spouse with financial control may make an active effort to conceal assets from the other spouse, in the hopes that s/he will be able to keep the entire amount of that asset after a divorce, rather than split it equally with the other spouse.
If you’re in this situation, it can be hard not to become adversarial with the other spouse at the start of your divorce. As the spouse without financial access, you’re concerned that the other spouse may not be open and honest regarding the financial assets of the marriage. In addition, extramarital affairs and other circumstances of a divorce, can make it very difficult for spouses to be honest with one another or believe the other spouse is entitled to assets acquired during the marriage.
Other times, assets are hidden from spouses during a divorce, simply because neither spouse knew that the asset was considered marital property and therefore, that it should have been divided between the couple.
If you’re unsure of what’s considered marital property and what you’re entitled to in your divorce, read: What am I entitled to in a Divorce in Minnesota?
Fortunately, Minnesota law discourages one spouse from taking advantage of another spouse in this manner, by requiring both parties in a divorce to disclose relevant information to each other. However, with that being said, the judge can only divide (equally and fairly) marital property that s/he knows about. In other words, if the asset isn’t listed, there’s no way for the judge to fairly and equally divide it. Therefore, it’s wise to be aware of the typical type of assets that couples try to hide from one another in a divorce, if you’re having concerns.
Most Typical Assets Spouses Hide During Divorce
The most common assets that couples try to hide from one another in divorce, include, but is not limited to:
- Bank accounts
- Retirement accounts
- Real estate
- Personal property of value (think jewelry, expensive electronics, etc.)
Bank accounts and retirement accounts are by far the most tempting for a spouse to try to hide because they often have great value. In addition, bank accounts and retirement accounts are not easily visible to the other spouse, for example, as say, like a house or a car.
Therefore, it’s not uncommon for a spouse who suspects that his/her spouse is hiding assets, to hire a divorce attorney to ensure fair division of assets. A divorce lawyer can use both informal and formal discovery practices in order to ensure that assets aren’t being hidden during a divorce.
Discovery: What to do When Spouse is Hiding Assets During Divorce
As mentioned, it’s illegal in Minnesota for either spouse to try to conceal and hide information from the other spouse. So the process of trying to find out information is known as discovery. In this case, discovery refers to the mandatory disclosure of information between a couple during a divorce. Therefore, if you believe your spouse is hiding assets from you, it’s not uncommon to turn to the discovery process. Also as mentioned, discovery can be conducted both informally and formally.
Informal discovery is the most typical way that discovery happens during a divorce. An informal discovery is made by simply requesting information from the other side regarding the specific asset(s) of concern. Either spouse in the divorce can use informal discovery to obtain specific information from the other spouse. If the other spouse doesn’t comply with informal discovery by providing the requested information about the asset(s) in question, then formal discovery can be utilized.
As an alternative, formal discovery methods can be used when information isn’t being provided or the other side refuses to be upfront during the divorce. Formal discovery involves the drafting and serving of legal documents which clearly request information from the other side, including information about the asset(s) in question. One notable difference between informal and formal discovery is that during formal discovery, the other spouse may request information from the other spouse on all assets, rather than just information on the asset(s) in question.
Therefore, formal discovery is a much more comprehensive and thorough process. Like informal discovery, either spouse in the divorce can use formal discovery to obtain information from the other spouse. In addition, your divorce lawyer will help by drafting the formal discovery documents and serving them on your spouse or his/her divorce attorney for you. The legal documents that need to be drafted for formal discovery should be meticulously written and the procedures involved are very precise. If not done properly, it can be detrimental to your case.
What Happens When Your Spouse Hides Assets
It’s both reassuring and important to know that discovery is taken very seriously. If your spouse fails to respond to formal discovery, the judge in your case can issue formal sanctions, including contempt of court, against your spouse for failing to disclose the documents and/or information requested.
Unbelievable as it may seem (given the stereotype and reputation of attorneys in popular media) you’re actually at the greatest risk for your spouse hiding assets from you when you or your spouse is not represented by a divorce attorney.
Because regardless of what you see in the movies, attorneys are held to a strict set of ethical rules. Such ethical rules include honesty and candor with the court in all legal matters. Therefore, many attorneys, rightfully so, are not going to be willing to risk their license, career, livelihood, etc… to help one client hide assets from his/her spouse when there has been a discovery request.
Thus, if you’re thinking about getting a divorce or are currently in the process and you believe your spouse is hiding assets or may try, the best way you can protect yourself and your family (currently and in the future) is to consider enlisting the help of a divorce lawyer. Your divorce attorney will work to discover all assets and make sure you get everything that you’re legally entitled to in your divorce.
If you’re not sure if you need a divorce attorney, read: How to Determine if You Should Hire a Divorce Attorney. The article will give you an idea of the steps you’ll need to take if you’re representing yourself, what issues you’ll want to address in your divorce decree, and common scenarios for hiring a divorce attorney. In addition, if you decide to hire a divorce lawyer, there are helpful articles linked at the bottom to help you go about the hiring process.