One of the key issues in every divorce is dividing the assets. Behind only the custody and visitation of the children, how the money is divided is often the most pressing concern for most divorcing couples. Asset division is a common part of the divorce process in which each spouse is required to disclose all assets, income and debts to the court.
However, it is not uncommon for a spouse to use creative methods to hide various assets. If there are assets that the court cannot see, these assets will not be split, so hiding assets can be extremely lucrative.
Using Charity to Hide Assets
According to a recent report in Inside Philanthropy online, a wealthy man is being accused of hiding assets in charitable donations to his alma mater. While the article is unclear as to exactly how this man used his charitable donations to hide assets, he is being accused of a number of other financial issues, as well.
How Do People Hide Assets in Divorce?
The example of the husband using his philanthropic efforts to conceal assets in a divorce is one example – and a particularly distasteful one – but there are many more. Some of the most common ways to hide assets include:
- The friends and family plan: In this approach, the spouse will withdraw money from a shared account or transfer property to family in friends so that these assets won’t show up in financial documents. Cash is the most common means of these transfers, since they don’t leave the same paper trail.
- Laundering assets through business ownership: Small business owners who keep their own books have some of the easiest means for asset hiding. From “overpaying” themselves to hiding assets through phony transactions and even having business partners hold money for them, business owners can always find a way to conceal assets.
- Deferring work benefits: Many people who are close with their bosses can ask to have promotions, bonuses and other significant benefits delayed until after a divorce to avoid having these assets come under the scrutiny of the court for division.
These are just a few of the many examples of how to hide assets in divorce.
What Should You Do?
The first and most important thing you should remember is: Do not try to hide assets. It is highly unethical, illegal and likely to cause serious problems in your divorce proceedings. No matter how well you hide assets, an experienced lawyer with a talented finance team will almost always find it.
Second, talk with a lawyer. If you think your spouse is hiding assets for an upcoming divorce, it is important to make sure you work with an attorney who can spot these discrepancies and protect your financial interests.