For as long as there are divorce proceedings in California, there will be spouses trying to hide assets from the other spouse for any of the following reasons, among others:
- To avoid having to share community property 50/50 with the other spouse
- To prevent the other spouse from having cherished pieces of property, e.g. family heirlooms or jointly-acquired property with sentimental value
- To make the spouse look less wealthy in an attempt to lower the amount of spousal support or child support to be paid or to increase the amount he or she can demand
- To simply drive the other spouse crazy through the emotional process of divorce
Family court judges are tasked with requiring both parties to be truthful in their filings with the court so as to make fair determinations, but they only have so much power they can wield in investigating the accuracy of filings, meaning such matters often come down to “he said, she said.” Or, worse yet, “he hid tons of assets, and she never found out about them, and neither did the court.”
Thus, the responsibility of preventing a spouse from hiding assets during the divorce lies on the shoulders of the other spouse. Here are a few tips to help in that process.
Gather All Financial Records Before You File
Perhaps the most important thing you should do is make sure you have current copies of all financial records between the two of you (tax returns, savings and retirement account statements, credit card statements). In addition, you should get access to all accounts, regardless of whose name they are in, keeping in mind that, in California, all property earned and acquired during the marriage is considered community property belonging to both of you, irrespective of the name on the title.
If you have these records before you file (and before you even inform a spouse of your intention to divorce), then you can see whether changes have been made in your finances, including unexplained withdrawals and transfers. No such transactions should take place without your approval.
If your spouse filed first and you are reacting to that, do everything you can to track down financial records as far back as possible to see if unexplained transfers or withdrawals occurred, as they may be able to be reversed in the divorce.
Keep a Regular Check on all Joint and Individual Accounts
After you have ongoing access and records to all accounts, you will want to keep a regular eye on these accounts to make sure depletions in the form of irregular withdrawals and transfers are not being made. Unscrupulous spouses often try to transfer funds to family members and friends to keep them from the other spouse, but, by keeping an eye on this, you can hopefully deter this or at least respond quickly when it does happen. Try an automated money management software such as Mint.com to keep access to these account records in one easy-to-check place.
Put Together a List of All Marital Assets
In addition to accounts, you should also make a list of all other types of marital assets, especially valuable items such as jewelry, art, antiques, electronics, etc. By doing this as early as possible in the process – and when the property is still in front of you to be itemized (as opposed to after a spouse quickly moves out, taking many things along) – you can check this against financial disclosures made later on and prevent your shared assets from being selfishly and illegally retained by the other spouse
In doing this, you should take special care to look for assets that may be kept by a spouse in locations other than the home, such as at work, a family business, a vacation home, the home of a parent or other family member, and other locations.
For any questions on family law in California, contact the Law Office of Kelley C. Finan today to schedule a consultation to discuss your circumstances.