Are Assets Being Hidden in Your Divorce?

 Posted on September 14,2017 in Division of Assets

Sometimes in a divorce proceeding, one or both spouses try to get an unfair advantage in regard to property division. Asset hiding is depressingly common, with Forbes reporting approximately one-third of people with joint bank accounts have committed “financial deception.” However, it is still illegal, and you could be in serious trouble if you are caught.

Illinois Property Division

In Illinois, marital property division is done equitably, which means fairly rather than equally. It is generally held to be a matter of good public policy that divorce proceedings do not leave one spouse in a significantly financially disadvantaged position. If one spouse has far more earning potential than the other, he or she will likelyl be ordered to provide more support or given fewer assets.

This does not, however, apply to non-marital property. Non-marital property refers specifically to assets or income that is obtained prior to the marriage or specific assets acquired by one spouse. Examples include inheritances or gifts, neither of which are divisible in Illinois (though they are in other states). Non-marital property can be commingled with marital property, to an extent that makes it difficult to separate the two - if this is the case in your divorce proceeding, the court may hold that the property has been “transmuted” into marital property by the act of commingling the two. This can be an unpleasant shock if one spouse does not expect it.

How to Find Hidden Assets

The biggest red flag for potential hidden assets is a refusal to produce information. Illinois law strongly prohibits and will allow stays in proceedings to discover any hiding or concealment of assets, either actively or through not providing financial records. Normally, the spouses in a divorce action work together to come up with a complete financial picture of the marriage. If this does not happen, it is a strong indication that you have a potential problem.

Another potential issue is a sudden decrease in cash flow. If your spouse is suddenly taking home far less than they have done previously, it may be an indicator that they are hiding income in either the hands of third parties, or behind false transactions such as overpaying the Internal Revenue Service. It is sometimes possible for a spouse to even defer promotions or bonuses. Doing so may prevent the income from appearing in their accounts for a time with the intent of collecting the remainder after the divorce is final.

Tied into this is behavior that may intentionally lower the value of a family business or their share of one. For example, a spouse who runs a business may deliberately refrain from attracting new business for a time, or even sabotage their own brand. After all, the less profitable the business is, the less there is to be provided to the soon-to-be ex-spouse—or so the offending spouse is inclined to believe.

An Attorney Can Find the Truth

Hiding assets is unethical and immoral, not to mention illegal. If a spouse is caught hiding assets, they may be subject to financial penalties or even, in extreme situations, jail time. The stakes are too high to go it alone. Contact an experienced DuPage County divorce attorney to get the guidance you need today. Call 630-352-2240 for a confidential consultation with Pesce Legal Group, P.C. today.

Sources:

https://www.forbes.com/sites/jennagoudreau/2011/01/13/is-your-partner-cheating-on-you-financially-31-admit-money-deception-infidelity-red-flags-money-lies/

http://www.ilga.gov/legislation/ilcs/ilcs5.asp?ActID=2086&ChapterID=59