When a marriage ends in a divorce, both spouses have a legal duty to be honest about their finances. Virginia’s equitable distribution process depends on full transparency from both sides. Unfortunately, not everyone follows the rules. Some spouses will go to great lengths to hide assets from the other spouse before the property division process begins.
If you suspect that your spouse isn’t being upfront about their finances, you’re not powerless. Virginia law provides several tools for uncovering hidden assets and holding a dishonest spouse accountable. Read on to learn how the process works and what you can do to protect your financial interests.
Why Do Spouses Try To Hide Assets?
The motivation behind hiding assets is usually straightforward. Virginia is an equitable distribution state, meaning marital property is divided fairly, not necessarily equally, between both spouses during a divorce. The more marital property that’s on the table, the more the other spouse stands to receive. By keeping certain assets out of view, a dishonest spouse hopes to walk away with more than their fair share.
There are many ways this can happen. Some of the most common tactics include:
- Transferring funds into accounts that the other spouse doesn’t know about
- Overpaying the IRS and creditors with the plan to collect a refund after the divorce is over
- Giving money to friends or family members for “safekeeping.”
- Underreporting income from a business
- Buying high-value items that can be easily overlooked during property division
These strategies might seem clever on the surface, but Virginia courts take a very dim view of financial dishonesty during divorce proceedings.
How Does Virginia’s Equitable Distribution Process Work?
Under Virginia Code § 20-107.3, the court’s job is to sort out all property owned by either spouse and label it as separate, marital, or a mix of both. Separate property usually includes things you owned before the marriage, inheritances, and gifts given to just one spouse. Marital property covers most assets and debts that came about between the wedding date and the date you and your spouse separated for good.
Once everything is classified, the court divides the marital property based on a range of factors laid out in the statute, including:
- The monetary and nonmonetary contributions each spouse made to the well-being of the family
- How long did the marriage last altogether
- The age and physical and mental health of each spouse
- How and when specific assets and debts were acquired
- Whether either spouse used marital property for a nonmarital purpose, particularly if it was done in anticipation of divorce
That last point, sometimes called “dissipation,” can be important in cases involving hidden assets. It gives the judge discretion to sometimes shift the property division against the spouse who wasn’t honest.
What Legal Tools Can Be Used To Uncover Hidden Assets?
Virginia’s discovery process gives your attorney several powerful methods for investigating your spouse’s finances. These tools are key when you suspect that assets are being concealed.
A few of the most prominent include:
- Interrogatories: These are written questions that your spouse must answer under oath. They can be used to identify important information like bank account details.
- Requests for production: This form of discovery requires your spouse to turn over financial documents such as tax returns and business records.
- Depositions: These allow your attorney to question your spouse directly, under oath, about their financial situation. Inconsistent answers during a deposition can be powerful evidence of concealment.
- Subpoenas: These can be issued to banks and other third parties to obtain records that your spouse may have failed to disclose on their own.
In more complex cases, your lawyer may also bring in a forensic accountant to help uncover the truth and protect your interests.
What Happens if My Spouse Is Caught Hiding Assets?
Virginia courts take concealment seriously, and the consequences for a spouse who is caught can be significant. Depending on the circumstances, the court may take a number of actions in response.
These include the following:
- Adjusting the property division in favor of the spouse who was deceived
- Imposing monetary sanctions for failing to comply with discovery obligations
- Holding the concealing spouse in contempt of court, which can carry fines and jail time in severe cases
- Ordering the dishonest spouse to pay the other side’s attorney’s fees and court costs incurred as a result of the concealment
If hidden assets are discovered after a divorce has already been finalized, the wronged spouse may be able to return to court and seek a revised distribution. This is particularly true when the concealing spouse made sworn representations during discovery that later turned out to be false.
Contact the Fairfax Divorce Attorneys at Chowdhury Divorce Law Group for Help Today
Full financial disclosure is not optional in a Virginia divorce. If a spouse hides assets, they are violating their legal obligations and undermining a process that is supposed to be fair to both sides. The good news is that Virginia law gives you meaningful tools to fight back with.
At Chowdhury Divorce Law Group, our experienced Fairfax divorce lawyers can help you protect your rights and interests throughout the divorce process. Contact us today at (703) 271-6519 to schedule a confidential consultation and learn more about your best course of action.
