Marital property is subject to division upon divorce. This legal reality tempts some spouses to understate their assets and income, or even hide ownership of certain items altogether. If you are facing divorce and have concerns that your spouse may be holding financial secrets, here are a few red flags to watch out for.
Seizing full control
Has your spouse recently tried to cut you off from financial information? Such suspicious behavior can come in many forms, from changing the passwords on your shared online banking accounts to establishing accounts and post office boxes behind your back. If it seems like your spouse doesn’t want you to know about certain financial dealings or streams of income, it’s a red flag that warrants a closer look.
Concealing and underreporting income
If your spouse is a high-level executive or other well-compensated individual, determining the full extent of his or her income may require a thorough investigation. A deep dive into a compensation package may reveal productivity bonuses, , company stock, options or other stock-based awards, and other income that goes far beyond a base salary. All types of income must be accounted for in property division proceedings.
If your spouse is a business owner, a sudden loss in revenue is a red flag worth investigating. Profitability fluctuates, but if the business is suddenly and inexplicably hurting now that divorce is looming, it may be more than just market conditions at play.
Moving money around
A flurry of transactions in the months preceding a divorce may be a sign that your spouse has something to hide. Some of the ways people try to conceal assets during or prior to divorce include:
- “Giving” money to friends and family members
- Establishing accounts in other localities or in the names of other entities
- Buying art, collectibles or other items that are difficult to value
Suspicions of hidden assets may complicate divorce, but this is no reason to give in to such unscrupulous tactics. Your soon-to-be-ex may be surprised to learn just how much a thorough investigation by a skilled legal team can reveal.