Chicago divorce attorney for hidden assetsAlthough we rarely think of marriage in these terms, spouses who get married enter into a financial partnership with each other. Consequently, a marriage represents much more than the romantic or personal connection between spouses. It also represents a melding of the spouses’ finances. Per Illinois law, spouses are entitled to an equitable portion of the marital estate during divorce. Unfortunately, the process of allocating marital property between spouses in a divorce becomes much more complicated when a spouse lies about finances. 

If you are getting divorced, it is essential to understand your rights regarding the division of marital property, child support, spousal maintenance, and other divorce issues. If you suspect that your spouse is lying about finances or may attempt to hide assets during your divorce, contact a divorce attorney for help right away.

Understanding Illinois Law Regarding Marital Assets and Divorce

Illinois is an “equitable distribution” state with regard to the division of assets during a divorce. This means that by law, you have a right to an “equitable” or fair share of the property contained in the marital estate. Most of the property and liabilities accumulated by either spouse during the marriage fall into the category of “marital property.” Marital property often includes bank account balances, retirement funds, investments, real estate, vehicles, and household items like furniture. Complex assets like stock options, mutual funds, businesses, and professional practices may also fall into the category of marital property. If an asset is considered marital property, both spouses are entitled to a share of the asset’s value.

Before spouses can start negotiating a property division arrangement during divorce, a full accounting must be made of each spouse’s income, assets, and debts. However, some spouses “forget” to include income and assets or intentionally transfer wealth in order to shelter it from division during divorce. This type of financial deception is not only unethical, it is also unlawful.  

Why Divorcing Spouses Lie on Financial Disclosure Forms

There are many reasons that divorcing spouses may lie about their finances during a divorce. In most cases, the motivation is financial. A husband or wife who wants to manipulate the property division settlement in his or her favor may transfer assets to a secret bank account or fail to disclose all sources of income. Financial deception can heavily influence child support and spousal maintenance arrangements. Child support payments are based on a statutory formula that considers the difference between the spouses’ net incomes. A deceptive spouse may try to artificially reduce his or her child support obligation by reporting an income that is lower than his or her actual income. Spouses may try to manipulate spousal maintenance arrangements in the same manner.

Spouses may also lie about finances during divorce out of spite or revenge. They may even purposely destroy assets simply to prevent the other spouse from acquiring or benefiting from the asset.  Whatever the reason, financial deception during divorce is against the law. Every spouse deserves a divorce settlement that is based on correct, up-to-date financial data.

Signs Your Spouse May Be Pulling the Wool Over Your Eyes

Whether you are thinking about ending your marriage or have already filed for divorce, it is important to watch for signs of financial manipulation. This is especially crucial if your spouse has traditionally taken charge of financial decision-making or you have been out-of-the-loop regarding shared finances.

Some signs that your spouse may attempt to hide assets or lie about finances during your divorce include:

  • Secretive behavior – Your spouse hides financial documents, changes online banking passwords, deletes computer files, reroutes mail to a P.O. box, or is otherwise secretive about financial concerns.

  • Refusing to discuss finances – Your spouse refuses to discuss financial issues with you or becomes highly emotional when financial topics are broached.

  • Asking you to sign documents that you do not understand – Never put your signature on a document that you have not fully read and understood – and ideally, run past your attorney. If your spouse demands that you sign documents before you have had time to fully read and understand them, this is a huge red flag.

  • A sudden loss in income or business revenue – Sudden financial struggles are sometimes a sign of financial deception in a divorce. For example, if your spouse reports that a previously thriving business is now floundering, this may be a sign that he or she will attempt to undervalue the business during divorce.

  • Unusual financial transactions – Buying expensive items, gifting money to friends and family, and other unsual financial transactions may be signs that a spouse is trying to hide assets.

  • Making frequent cash withdrawals – Some spouses hide assets by literally hiding cash. If your spouse is withdrawing unusually large amounts of cash from bank accounts or getting “cash back” on other purchases, he or she may be planning to hide the cash to avoid splitting it with you during divorce.

  • Paying off unknown debts – Is your spouse suddenly hyper-focused on paying back a personal loan that you knew nothing about? If so, your spouse may be creating fake debts to hide money.

Methods Spouses May Use to Hide Assets or Income in a Divorce

The key purpose of lying about finances during divorce is to minimize the financial losses that a spouse suffers because of the split. A spouse may claim a lower-than-actual income in an effort to reduce the amount he or she pays in spousal support or child support. Another spouse may “forget” to include offshore accounts in his or her financial disclosure so that his or her spouse does not get an equitable share of the funds contained in the accounts.

Some of the most common methods spouses use to conceal assets or falsify financial information during divorce include:

  • Transferring assets – Your spouse may hide assets by transferring funds to a separate account. Some spouses even use friends and families to hide assets during divorce. They simply “loan” money to a friend or family member and then reclaim the money after the divorce.  

  • Overpaying the IRS – Some spouses overpay taxes so that the money is essentially hidden during the divorce. Then, the spouse recoups the money after the divorce is finalized through a sizable tax refund.

  • Buying expensive items – Assets like antiques, artwork, and collectibles are difficult to value. Some spouses buy expensive items and then undervalue the assets on their financial disclosures during divorce.

  • Overinflating expenses – Spouses may fabricate expenses and debts that do not really exist to make their financial situation appear bleaker than it actually is.

  • Hiding business assets – If your spouse owns a business, he or she has an even greater number of opportunities to be deceptive about finances. Business owners may undervalue their business by falsifying company financial records, delaying client or customer invoices, pre-paying employee benefits, or relying on “under the table” cash transactions.

  • Failing to disclose all income and assets – The most common way that spouses try to hide assets is by simply failing to disclose all of their income and assets during divorce.  

Dissipation of Assets in a Divorce

“Dissipation of assets” occurs when a spouse misuses or wastes assets during or immediately prior to a divorce. Some of the most common examples of dissipation include spending a considerable amount of money or property in relation to:

  • Gambling

  • An extramarital affair

  • A substance abuse problem or addiction

Dissipation of assets may also refer to the purposeful waste or destruction of assets. If your spouse has spent money or property for a purpose unrelated to the marriage in the months or years prior to divorce, you may have a valid dissipation claim. You may be entitled to a greater share of the marital estate to compensate you for the misused assets.

Using Forensic Accounting and Discovery Tools to Uncover Financial Deception

If you suspect that your spouse will try to hide assets or has already been dishonest about finances, it is important to work with a divorce lawyer who is experienced in uncovering financial deception such as this. Your lawyer may work closely with a particular type of accountant called a forensic accountant to reveal hidden assets and uncover the truth. Forensic accountants often investigate tax returns, loan applications, business balance sheets, and other financial documents to look for inconsistencies or contradictions that may be signs of financial deceit. They also help determine the true value of businesses, professional practices, and other hard-to-value assets. Forensic accountants may testify under oath during a deposition or divorce trial about the information he or she has uncovered.

Your lawyer may also utilize various tools during the “discovery” portion of the divorce process to find evidence of financial deception. Discovery is the “fact-finding” step in the divorce process. Lawyers have various legal tools at their disposal that compel individuals or organizations to divulge information or documents. Some discovery tools that may be used to reveal evidence of hidden assets during divorce include:

  • Requests for production of documents – This is a formal request used to make a spouse deliver financial documents like bank statements, pay stubs, tax returns, or profit and loss statements.

  • Requests for admissions – Requests for admissions require a spouse to assert or deny a statement under oath. For example, a request for admission may ask a spouse to admit that he or she is a signatory on a certain bank account. Lying under oath is called perjury. A divorcing spouse who lies under oath faces civil consequences and even criminal penalties.

  • Interrogatories – Interrogatories are written questions that a spouse is required to answer under oath. For example, a spouse may be asked, “During the last year, has any person held cash or property on your behalf?”

  • Depositions – A deposition is an in-person meeting during which spouses testify under oath. The parties’ responses are recorded and may be used in later court proceedings.

  • Subpoenas – A subpoena is a court order that compels an individual or company to do something – typically to provide testimony or information during a court case. For example, a subpoena may be used to compel a business to hand over financial statements or employment records.

Contact an Elmhurst Divorce Lawyer

Lying about finances can heavily impact property division, child support, and spousal maintenance determinations in a divorce. You deserve a divorce settlement or judgment that is founded on true, accurate financial data.

For help uncovering hidden assets, contact an experienced DuPage County divorce lawyer at Weiss-Kunz & Oliver, LLC. Our team of skilled legal professionals knows the sneaky tricks spouses use to manipulate the outcome of a divorce and how to overcome these tactics. We can help you obtain an accurate, complete accounting of your marital assets so that you can fairly negotiate a property division arrangement. If an out-of-court settlement is not possible, we will fiercely represent your best interests at trial. Attorney Maxine Weiss Kunz has successfully tried divorce cases involving complex assets, contentious child custody issues, and disputed marital agreements. We often work closely with financial experts such as forensic accountants and other professionals to ensure that our clients receive the best possible outcome.

Call us at 312-605-4041 for a confidential consultation.


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