Hidden Assets During Divorce
Article written by: Amanda Marsden Calgary family lawyer
One of the most important steps in any separation or divorce is the disclosure process. Before the parties can determine how to divide matrimonial debts and assets, both sides need a complete understanding of what those debts and assets are. This process includes a requirement that both parties provide sworn financial statements that outline all of the property each of them owns. However, in some Calgary family law cases some people fail to meet their disclosure obligations and attempt to provide incomplete or misleading disclosure. This can be part of a strategy to impact the division of matrimonial property or support obligations.
What are some of the signs that your spouse is attempting to hide matrimonial assets?
The first thing to look for are changes in financial habits before or after separation. For example, an increase in cash withdraws or transfers from accounts can be a red flag. Loans or gifts of money to family or friends is another sign to watch for. Opening new bank accounts or credit cards or significant overpayment on a credit card are all things that should be made note of. Keep an eye out for unusual statements or letters from banks that you have not previously dealt with, as this may mean that your spouse has financial dealings at another institution. In order to determine if any of these issues have arisen, a Calgary family lawyer can review bank statements or company financial statements and identify potential problems. Examining investing patterns and identifying significant changes in investing is another way that a family lawyer will look for the signs of hidden assets after separation or divorce.
If you suspect your former spouse is misrepresenting their assets or income after separation, a family lawyer can use several tools to address the issue. The first step is to file a Notice to Disclose Application through the Calgary courts, which will require a sworn list of assets, income, and liabilities from each party. If there are issues with the disclosure provided, or concerns arising from the banking information provided, questioning, or examination for discovery can be done to better understand the situation. In questioning, undertakings to provide relevant documents can be requested by your family lawyer.
In extreme circumstances family lawyers may recommend hiring a forensic accountant to investigate the movement of funds after separation or divorce. Forensic accountants can assist by following financial transactions over a period of time to determine if there has been any dissipation of matrimonial property. A forensic accountant can also help trace exempt matrimonial property back to its origin and determine whether or not there has been a co-mingling of matrimonial funds that would otherwise be exempt from equal division. Many Calgary family lawyers, including those at Crossroads Law, have relationships with well-respected forensic accountants in Calgary and would be happy to recommend the right accountant for your circumstances.
In cases where one spouse has attempted to conceal assets and income, before or after separation, the Court has the ability to draw an adverse inference. This can result in the court granting an unequal division of family property, leading to the spouse who concealed assets being entitled to less property than the other spouse. The Court also has the option to make a preservation order, which can freeze matrimonial assets and prevent any further dissipation after separation or divorce.
The lawyers at Crossroads law have a wealth of experience in dealing with people who have attempted to hide assets during the divorce process, or even before separation. If you suspect your spouse is misrepresenting the martial assets, contact us for help in determining how to proceed.