Hidden assets in divorce


7th March 2023

We have all seen the shock headlines in the press splashing details of divorcing spouses who have been accused of hiding millions during their divorce proceedings. One recent case in the US involved a property entrepreneur being accused of hiding $130m from his film director wife after she found out that he had spent $532,000 on wooden ducks!

While the extremes of these headline cases may not be common, hiding assets in divorce is a scenario that we see all too often. In any Family law matters, full and accurate information about the extent of each party’s finances is crucial to being able to reach a full and fair settlement.

If you do not think that you can rely on your ex-partner to be open and truthful about what they own, then your solicitor can help in a variety of ways:

Evidence

We mainly use documentation to prove the existence of an asset. The right questions need to be asked at the right time, and in the right way (this is often done in a questionnaire which your ex-partner has to reply to).

Forensic accountant

Where there are lots of bank accounts with lots of transfers between them and/or business interests, the involvement of a forensic accountant can be really helpful. Amongst other things, forensic accountants can identify if money is being removed to undisclosed accounts and advise about the value of business interests.

Statements

If you and your ex-partner cannot agree on particular factual issues, then written witness evidence can be submitted to the Court (with the Judge’s permission), which allows each of you to explaining the issues in your own words (sometimes with reference to more documents).

Adverse inferences

If your ex-partner has had a decent opportunity to answer your reasonable questions and provide the necessary documents but chooses not to or gives a (perhaps deliberately) evasive or off-point answer, it is possible to ask the Judge in make an adverse inference from this. Essentially, this is a finding that your ex-partner does own the assets you’ve been asking about and has decided not to reveal them because they don’t want to share them.

Notice to admit facts

It is possible to make an application to the Court during proceedings for a ‘Notice to admit facts’, which is a method which can occasionally be used as a ‘quick fire’ way of establishing facts and getting the truth out of your ex-partner. If successful, this can lead to the Court to make an order that your ex-partner must pay some or all of the costs that you have incurred in trying to establish the facts, as if they had simply told the truth you would not have incurred these costs.

If your ex-partner is determined to withhold information then there is no denying that this can be a slow and frustrating process, however the options set above show that all is not lost in this scenario. A planned and purposeful strategy is a must, and we would recommend taking legal advice to ensure that the best strategy for you is put in place.

We have a team of experienced family lawyers who can guide you if you think the issues raised in this article might apply to you. We can go through all the options available to you and help you decide your best course of action. Contact our experts to see what we can do for you.

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