Money issues are common in divorce matters. In many cases, the parties did not see eye-to-eye on finances during the marriage or one spouse controlled the family’s accounts and spending, and the other spouse did not have access to this information. Financial issues are exacerbated when a couple divorces, particularly if the parties no longer trust each other. This situation can quickly spiral if certain assets are suddenly missing or not accounted for during the divorce process.
There are some telltale signs to watch for that may indicate that your spouse is hiding or has disposed of money and/or other assets. Keep an eye out for:
- Denial and Defensiveness: When you ask your spouse about finances, assets, or cash flow they contend that the assets never existed or the money was just “spent” with no explanation, and that you have made a mistake. Instead of being forthcoming with information, they may become overly defensive and refuse to share information with you.
- Unusual Transfers: If you have access to account statements, look for out-of-the-ordinary transfers to friends, businesses, unknown third parties, relatives, or even to your children – such as substantial funds transfers to the children’s custodial or college accounts. Transfers may be made via ACH transfer, checks, Zelle, Venmo or other cash transfer applications. When reviewing account statements, be sure to note any transfers to unknown accounts.
- Missing Assets: In some cases, accounts are closed and there is no accounting for the funds or investments that were held in the account. Or a valuable item of jewelry or artwork goes missing from the home and no explanation provided.
- False Debts or Receivables: Friends and relatives may willingly collaborate with your spouse to hide assets. For example, your spouse may create loan documents for or “repay” non-existent debt to relatives by transferring funds to their accounts. Likewise, marital funds may be transferred to a friend or relative by your spouse with an “IOU” to be repaid at some unspecified date or time.
- Deferring Income: Some employers may allow postponement of bonuses or raises at the request of their employee. If your spouse has regularly received raises or bonuses during the marriage and now that a divorce is filed this income is “uncertain” or is no longer paid, that should raise an eyebrow.
How to Protect Yourself and Your Assets
If you are unfamiliar with your marital assets, check prior tax returns which will list assets such as real estate investments, business interests, interest and dividend bearing accounts, and other investments. Check for unusual transfers or unfamiliar financial accounts or even hidden cash at home. Most importantly, talk to your attorney about your concerns. An experienced divorce attorney will know how to use litigation tools, such as discovery, to ensure your spouse turns over those assets.