Ideally, couples who get divorced opt to divide the assets that they own equitably. The property division process doesn’t always go smoothly, which is why the courts may become involved. Couples are required to disclose what assets they own to the court as they work their way through a litigated divorce process.
Unfortunately, a spouse sometimes decides that they don’t want to split their assets fairly with their ex. This could happen because they didn’t want to get divorced, for instance, or just because they’re looking out for themselves, even if it means violating that court order. Two of the main ways that people do this are through the dissipation of marital assets and through hiding assets. These accomplish similar goals, but they are significantly different approaches
Hiding assets
When someone tries to hide assets, they are attempting to pretend those assets don’t exist. They don’t tell the court about them, and they hide them from their spouse so that the assets don’t get disclosed. Common tactics include putting money in a safe deposit box, opening hidden bank accounts or transferring money into a business that the person owns. Another tactic that people use is to give money to friends or family members. They may claim that they are paying back an old loan or giving someone a business loan, but they are really just transferring that money until after the divorce, when the recipient will return it to them.
Dissipating assets
When someone dissipates assets, they don’t try to hide their financial activity. They intentionally spend money. The spending will generally be perceived as wasteful. For example, imagine that one spouse is a high earner and their spouse doesn’t have a job. They know that they can earn the money back post-divorce. So, they spend it prior to the divorce, not worrying about wasting it on traveling or other frivolous purchases. They just want to spend it on things that are not tangible assets – which could be returned or given to their spouse – so that the money is gone during the property division process.
Legal options
Those who worry that their spouse may try to unfairly deny them access to the value of their marital estate need to be well aware of the legal options at their disposal. There are steps that can be taken to work toward a proper division of assets. Seeking legal guidance is a good way to explore one’s rights and options.