How Do Spouses Hide Assets During an Illinois Divorce?

 Posted on August 17, 2020 in Kane

During an Illinois divorce, spouses are asked to disclose detailed information about their assets, income, and debts. This information is needed to make informed decisions about property division, child support, spousal maintenance, and other concerns. Some spouses attempt to hide assets, underreport income, or otherwise falsify financial information in order to manipulate the divorce settlement in their favor. Uncovering financial fraud during divorce is often challenging and complicated – especially if a spouse owns complex assets such as stock options, real estate, trusts, or a business. In many cases, a forensic accountant may work with a divorce lawyer to investigate a spouse’s finances and reveal any deception.

Common Ways Divorcing Spouses Falsify Financial Information

Whether a divorce is settled out of court or through litigation, the terms of the divorce should be based upon accurate, complete financial information. Unfortunately, some spouses try to gain an advantage by misrepresenting their financial situation. Some of the most common ways that spouses hide assets during divorce include:

• Underreporting business revenue: Business owners may intentionally undervalue their business or use the business to conceal assets.

• Overpaying taxes: Some divorcing spouses intentionally overpay the IRS and then regain the money via a tax refund after the divorce is finalized.

• Undervaluing assets: Expensive purchases such as art or jewelry can be used to hide assets. A spouse may use cash to buy costly items and then significantly undervalue the items in his or her financial affidavit. He or she then sells the items once the divorce is finalized.

• Loaning or gifting money to friends or relatives: Spouses may attempt to temporarily reduce their assets by loaning or gifting money to friends, relatives, or colleagues.

• Hiding money in an offshore account: International privacy laws can make it difficult for a spouse to find assets hidden in foreign accounts, so spouses may transfer large amounts of money to offshore accounts.

• Failing to disclose assets: One of the simplest ways to hide assets is to fail to report or “forget” to report assets.

Forensic Accountants Can Help Reveal the Truth

Forensic accountants are accountants who have special investigative skills. They are capable of evaluating a spouse’s financial records and finding inconsistencies that suggest the spouse is not being entirely truthful. Forensic accountants often work closely with a spouse’s divorce lawyer to prepare document requests and interrogatories about financial information. They may also testify in court or during a divorce deposition.

Contact a Kane County Asset Division Lawyer

You deserve a divorce settlement that is based on reality, not lies. If you suspect your spouse may be hiding assets, it is essential that you obtain professional legal representation. At MKFM Law, we are equipped to help you uncover financial deception and protect your rights to the marital assets throughout the divorce proceedings. To learn more, call our office today at 630-549-0960 to schedule a confidential consultation with our tenacious St. Charles divorce attorneys.

Sources:
https://www.forbes.com/sites/jefflanders/2014/09/04/why-a-forensic-accountant-belongs-on-your-divorce-team/
https://www.ilga.gov/legislation/ilcs/ilcs4.asp?DocName=075000050HPt.+IV-A&ActID=2086&ChapterID=59&SeqStart=5200000&SeqEnd=6000000