More assets can make it easier to conceal funds or specific items. This is why it may happen often during high-asset divorces. Recognizing tactics for hiding assets is crucial for protecting your interests and ensuring an equitable settlement. Below are five common methods spouses use to hide assets.
Opening secret accounts
One common tactic is opening a new bank account. Your spouse can do this in another bank, state or even another country – especially one with stricter privacy rules. Opening domestic or international accounts using a different name further helps them hide the accounts.
Overpaying taxes or creditors
Another tactic involves overpaying creditors or the IRS. Making large estimated tax payments allows your spouse to file for tax refunds and reclaim the excess payments after finalizing the divorce.
Moreover, this method temporarily reduces the apparent value of their assets, which may help them minimize alimony as well. Reviewing recent tax filings can help you discover the truth about your spouse’s taxes.
Creating fake debts or loans
Your spouse might claim to owe money to a friend or family member. Doing so allows them to transfer money from their accounts and reduce their overall net worth. Methods to create fake debt include:
- Creating false invoices or business expenses
- Exaggerating the amount of loans or mortgages
- Inventing loans or payment obligations
Your spouse may also “loan” money to a friend or family member and have them “return” the loaned amount after the divorce.
Making purchases in others’ names
Some people attempt to shield assets by making significant purchases under someone else’s name. Whether it is real estate, vehicles or expensive art, putting these in someone else’s name can help your spouse hide their assets. This complicates the discovery process and can keep these assets off the record.
Transferring assets to family or friends
Some individuals attempt to hide assets by transferring them to trusted friends or family members. This tactic involves selling assets below market value or giving them to family members as gifts and then reclaiming ownership after the divorce.
Uncover hidden assets with legal help
Proving that your spouse has hidden assets is challenging. Consulting an experienced divorce attorney can help you uncover various tactics to hide assets. They can investigate financial records and help ensure a fair property division.