When a couple starts the divorce process, each party is supposed to tell the truth about assets they have and debts they’ve accumulated. However, not all divorces work that way.
It’s possible, for example, that a husband has an account he doesn’t want his wife to know about-because he’s using it to buy expensive gifts for his mistresses. It’s also possible that, in this age of people owning and operating their own businesses, money that should be community property is instead being channeled through the business account for personal purposes.
When one spouse suspects the other of hiding assets or debts from the other, even early in the divorce process when they’re supposed to lay all their cards on the table, there are steps that lawyers can take to help uncover what’s being hidden. Both parties in a divorce are supposed to disclose all their assets and debts to prepare for the divorce.
Most couples have jointly-held assets and debts that they’re likely both already aware of, though some married couples leave the finances in the hand of just the husband or just the wife. I had a recent case where a wife wondered why the husband was able to afford a recent motorcycle purchase even though they seemed to be struggling to meet all their bills. The wife was able to see the checkbook that the husband kept, but didn’t check the online balance-the husband was purposefully writing a deceptively low amount to make it appear he had less money than he actually did.
They also both might be aware of assets and debts in just one spouse’s name, though as I wrote in my last article, those are considered community property if they were acquired during the marriage. But there also might be assets and debts that each spouse has accumulated of which the other spouse isn’t aware.
If there’s any doubt, either party’s lawyer can file what’s called a discovery request. When that’s filed, the party served needs to produce all financial materials within 30 days of the request, not counting court holidays. That should, in theory, give the person served adequate time to produce the needed documents. This process is routine in most divorces and typically both parties produce the relevant documents.
If that still doesn’t happen, the lawyer can file a motion to compel, and if the person is still refusing to produce information with that motion in place, it’s possible to seek sanctions against that person for violating a court order, though it becomes a question of whether it’s worth it or not to seek sanctions.
It can also help to work with a forensic accountant, who can help find information on accounts and valuations on portions of the estate, in order to come up with a better sense of what the entire estate is worth. The court may also specifically bring appraisers in to provide valuations of homes and other major assets. (Actual home values can differ from what the county determines they’re worth.)
When you’re divorcing, it’s best to be open and honest with finances – but honesty isn’t necessarily the strong suit of people in this situation. Know that if a person isn’t forthcoming with finances in divorce, he or she can be found out and the situation can be corrected.