As part of the financial disclosure process in a Virginia divorce, each spouse is required by law to disclose all assets, income, expenses, and debt to be equitably divided, and to determine alimony and child support.
There is a violation of fiduciary duties if a spouse deliberately conceals the value of their assets because the disclosure requirement has not been suitably fulfilled. The disclosure must be made without any formal or informal request from a spouse.
Divorces can be complicated and stressful. If you’re struggling to make heads or tails of important issues to do with a separation or divorce, make sure you have a trusted divorce lawyer on your side.
Some Spouses Will Try to Hide Money or Assets in a Divorce
While most divorcing couples comply, some spouses will intentionally lie in order to keep assets or property to themselves. They erroneously believe that they can dissipate or conceal marital assets through hiding, extravagant spending, understating property value, or overstating debts.
Out of spite, some spouses may try to hide money or assets to deny their spouse the full benefit of the property’s value. The most common way of doing this is to have a friend hold on to money or an asset for safekeeping during the divorce process.
This misconception can unfavorably impact their equitable share of the assets during the divorce proceedings.
In community property states, assets are distributed equally. In equitable distribution states, however, assets are divided fairly based on several factors, which does not always end up in a 50/50 split.
Other means employed to hide assets include selling properties at a much lower price or secretly using a safety deposit box. Some businessmen report falsified transactions, make substantial changes to their salary, or use shell corporations during the divorce process.
Income is one of the chief factors in determining payment for spousal support (alimony) or child support. This can motivate the paying party to hide or understate their income in an attempt to reduce the amount they are required to pay.
A judge can award one spouse more than the other depending on each party’s earning capability, how much child or spousal support may be awarded, and how long the couple was married.
The Consequences of Violating Disclosure Laws
What are the risks involved if you hide money or assets during a Virginia divorce? A person can face serious consequences which can include financial sanctions, falling from the judge’s good graces and jail time.
Lying on disclosure can ruin a person’s credibility before the judge. Someone who is caught violating disclosure laws deliberately can face high fines, and may even be forced to pay their spouse the full amount of the asset that was originally concealed.
Concealing assets can also endanger your relationship with your lawyer since the judge can assume your counsel has knowledge of your dishonest act.
By honestly declaring your assets, you could avoid harsh penalties. Choosing to play unfairly can put you on the defensive side throughout the duration of your case.
Consult an Experienced Virginia Divorce Attorne
There are many complexities involved in a Virginia property settlement. We at Holcomb Law, P.C. have the knowledge, experience, and resources to fight for your rights and safeguard your financial future when it comes to asset division during your divorce.
For help with your divorce, call (757) 656-1000 or send us an email.