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vinnieg1980
Feb 202 min read

"Can I Protect My Assets During Divorce by Filing for Bankruptcy?"

Updated: Feb 22





During a divorce, it’s essential to maintain transparency regarding financial assets. However, some spouses may attempt to hide assets during the divorce process. Here are some key points to consider:

  1. Disclosure of Assets:

  • Both spouses are legally required to disclose all their financial assets during divorce proceedings.

  • If one spouse fails to fully disclose assets, it can lead to legal complications.

  1. Reasons for Hiding Assets:

  • Spouses may hide assets because they don’t want to share them with their soon-to-be ex-spouse.

  • This situation is especially relevant in high net worth divorces or cases where one or both spouses own a business.

  1. Methods of Hiding Assets:

  • Business Owners: Spouses who own businesses may manipulate business finances to appear less wealthy. For instance, they might delay lucrative deals until after the divorce or pay salaries to fictitious employees.

  • Trusts and Gifting: Spouses without businesses might set up trusts or “gift” money to someone who will return it after the divorce.

  • Involving Others: Spouses may involve family members or friends in hiding assets.

  • New Partners: Some spouses use marital assets to support a new partner, leaving fewer assets for division.

  1. Detecting Hidden Assets:

  • Forensic Accountants: If you suspect your spouse is hiding assets, consider hiring a forensic accountant. They can help uncover hidden financial information.

  • Discovery Process: During the divorce discovery process, both parties must answer questions and provide relevant documents. Commonly requested documents include tax records, account statements, and loan documents.

  • Depositions: Deposing your spouse or others with knowledge of their financial affairs can reveal hidden assets.

  1. Legal Consequences:

  • If a spouse is caught hiding assets, the court may:

  • Require them to pay the other spouse’s share of the assets.

  • Impose fines or even jail time for continued concealment.

Remember that honesty and full disclosure are crucial during divorce proceedings. Consult with a divorce attorney to protect your rights and ensure a fair division of asset

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