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What Is the Penalty for Hiding Assets During a Divorce?

Hiding assets by overstating debts, reporting higher than normal expenses, omitting sources of income, or understating the value of certain forms of marital property is shockingly common during a Pasadena divorce. But it's important to keep in mind that this behavior is both illegal and unethical.

When you file for divorce, you're asked to sign a Financial Affidavit stating that you are telling the truth about your finances under the penalty of perjury. Lying about your assets is considered the same as lying under oath. If you lie about your assets during divorce, you risk being ordered to pay your ex's attorney fees, losing the share of assets you would have otherwise received, or even being thrown in jail.

In California, the most noteworthy case involving hidden assets took place in 1999. Denise Rossi was married to her husband Thomas for 25 years. In 1996, she shocked him by abruptly demanding a divorce and insisting on ending the marriage as soon as possible. Thomas later discovered that she won $1.3 million in the California Lottery 11 days before filing, thanks to a misdirected piece of mail from a company that pays lump awards to lottery winners. Since she attempted to conceal the asset from her husband, the court awarded him the entire sum.

When discussing the penalty for hidden assets, it's important to keep in mind that a spouse who tries to hide assets isn't off the hook if the settlement goes through before the deception is discovered. The majority of divorce settlements have a clause that states the agreement is contingent upon the full disclosure of assets and that lying about assets will put you back in court to renegotiate the terms.

If you suspect that your spouse is trying to hide assets, it's important to discuss your concerns with your attorney. Finding proof of hidden assets often requires hiring a forensic accountant who can carefully look over financial documents for evidence of dishonest behavior.

How Can We Help?

If you are in need of legal representation for your divorce, please call our office at (626) 683-8113 or email us at info@PasadenaLawOffice.com. Our Pasadena divorce law firm is eager to assist you in any way possible.

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