Hiding assets during a divorce is fraud, and it is illegal, but it’s also something that people are often tempted to do. They may already by angry that they’re getting divorced in the first place. The last thing they want is to feel like their spouses took everything in the split. They’ll try to keep things out of sight in many different ways.
For example, employees sometimes have fringe benefits that they get from the companies they work for. These go beyond their salaries and could include things like stock options, expense accounts, bonuses and deferred compensation plans. When the financial paperwork for the divorce is handed in, they’ll “forget” about these things and just report their earnings from their paychecks.
Business owners also have the ability to hide funds since they have direct control over the company’s funds. They could try to hide their own money within the company, especially if a prenup protects the company’s assets.
Some people even take very simple routes. A man may open up a second bank account without telling his spouse, for example, and start dropping $1,000 into it every month. A woman could get a safety deposit box in her name alone and start stashing funds in case divorce strikes.
These are just a few examples, without even getting into complex issues like shell corporations and international accounts, but they help show just how easy it is for people to try to hide funds. If you’re getting divorced and you think your spouse may be doing so, you need to know that this is illegal and that there are steps you can take to ensure that assets are divided fairly.
Source: Huffington Post, “Financial Fraud and Divorce,” Peggy L Tracy, accessed Dec. 28, 2016