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How do people hide assets during divorce?

On Behalf of | Aug 18, 2023 | Divorce

Hiding assets during a divorce is generally illegal. Divorce proceedings require honesty, transparency and full financial disclosure to ensure a fair division of assets and liabilities.

Unfortunately, this reality does not stop everyone from trying to hide assets so that they do not have to split them with their spouse. It’s important to understand how someone may attempt to hide assets so that their efforts can be uncovered and appropriately addressed.

Underreporting income

One spouse might manipulate financial records to indicate that they earn lower income than they do, which could impact alimony or child support calculations. They may also attempt to reduce their income temporarily. For instance, they could put off getting a commission or accepting a promotion – with a raise – until after their divorce.

Overpaying debts

A spouse might pay off fake or inflated debts to reduce their apparent assets. Later, they can have the money returned after the divorce is finalized. A related example of this is overpaying taxes. They may deliberately overpay taxes to the government, with the intention of receiving a refund after the divorce, thus allowing them to temporarily hide these funds.

Transferring assets

This is one of the most common tactics used and something you absolutely need to look out for if you are getting divorced. Assets can be transferred to family members, friends or business partners with the intention of reclaiming them after the divorce is settled. A “business loan” to a brother may just be a way to have him own that money until after the divorce.

Creating hidden bank accounts

One spouse may open a secret bank account or offshore account to hide money. Some people also get safe deposit boxes where they can store assets and then deny that they exist. Similarly, cryptocurrencies and digital assets can be used. Some people might attempt to hide assets using cryptocurrencies or digital assets due to their potential for anonymity and limited regulation.

What options do you have?

It is illegal for your spouse to hide assets, but they may still try. This is an especially common risk in a contentious divorce, where people may not want to fairly divide what they own. If you find yourself in this position, be sure you know what legal options you have available to you and seek legal guidance proactively to better safeguard your interests.


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