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Going through a divorce affects you emotionally — and financially. A big point of contention for many couples during divorce proceedings is the division of financial assets and property.
If the divorce is not amicable, it’s not uncommon for one spouse to try to hide assets from the other. Learn more about why hiding assets in a divorce is a bad idea and what kind of legal consequences someone who does this can expect.
Hiding Assets in a Divorce: What It Means
During divorce proceedings in New York, the law requires that spouses submit statements about their assets, income, and debts. All of these statements have to be sworn under oath.
In New York, assets acquired during the marriage become marital property (with some exceptions, such as inherited property). Marital property is subject to equitable distribution, which means the assets have to be divided between spouses fairly.
Because they don’t want to share their assets, many spouses try to hide them before beginning divorce litigation or even in the middle of it. Maybe they “forgot” a bank account or decided not to include a retirement asset on their disclosure or maybe there is cash in a safe or under the mattress.
Keeping track of finances can be difficult, especially if the spouse has multiple types of assets:
- Retirement plans
- Businesses
- Investments
- Stock options
The more complicated the spouse’s financial situation, the easier it can be to go about hiding assets in a divorce.
A spouse who wants to hide assets might give friends or family money, a little at a time, and have them hold it until divorce litigation is over. They may also try to get paid in cash so that they leave no paper trail or even write checks that they later void. Sometimes, shortly before a divorce, someone may “repay” a loan to a close family member for a long forgotten and undocumented debt.
All of these steps are illegal and may result in serious consequences.
Consequences for Hiding Assets
Hiding assets from your spouse during a divorce is immoral. It is also illegal. Because you present your assets and swear under oath, lying about or not disclosing assets may result in legal consequences.
Perjury Penalties in New York
If a spouse lies to the court about assets, they may have committed perjury. In New York, third-degree perjury is a Class A misdemeanor and can earn the spouse a large fine and up to one year of incarceration.
Second-degree perjury is a Class E felony and can cost the spouse up to four years in state prison, along with hefty fines. First-degree perjury is a Class D felony and carries a penalty of one to seven years in prison.
In a divorce, the hiding of assets and lack of transparency may result in significant consequences when the Court is determining equitable distribution, spousal support, counsel fees and other important issues based on the credibility and disclosure of each party.
The number of assets the spouse hides and their value may affect which type of perjury charges they face.
Civil Penalties in New York
If your spouse hid assets during divorce litigation, the court can force them to pay any fees that you incurred while trying to find the hidden assets. These may include private investigator fees. The court might also give you more of the assets than you would originally have received.
Fraud Charges in New York
Misrepresenting finances during divorce is a form of fraud. If your spouse lies about how many assets they have or their true value, they may be committing a crime. A criminal court could find your spouse guilty of fraud and impose severe fines, jail time, or both.
Turning to a Skilled Divorce Lawyer for Help
If you’re going through a divorce and suspect your spouse is hiding assets, getting legal help is essential. You need experienced legal professionals to help you uncover the truth and get your fair share of marital property.
At Aiello & DiFalco, we work in all aspects of family law in Garden City, NY, helping protect your rights no matter the challenges you face. Contact Aiello & DiFalco today to get the justice you deserve.