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Signs Your Spouse Is Hiding Assets During Your Divorce (and What To Do About It)

Married couples frequently have a power imbalance in their relationship when it comes to finances. It’s common for one spouse to work while the other stays at home, or for both to work but for one to earn the bulk of the income. It’s also typical for one spouse to handle the investments or to pay the bills, while the other stays mostly in-the-dark about those subjects. 

This can work fine while a couple is married, but in divorce it can create significant stress and uncertainty. In particular, less-financially-involved spouses commonly worry that their spouse is hiding assets from them during the divorce process. 

It’s a valid concern. An angry or unscrupulous spouse may try to exploit a financial power imbalance to disadvantage the other, particularly when it comes to dividing property between them. 

Let’s explore community property division in Louisiana, the potential signs your spouse is hiding assets during your divorce, and steps you can take to protect yourself from that kind of misconduct. 

Community Property Division in Louisiana Divorce

Louisiana is one of a handful of U.S. states that follows community property rules for married couples. We won’t get into an in-depth discussion of community property here, but in a nutshell, the rule in Louisiana is that absent an agreement to the contrary, all property acquired during a marriage (including, importantly, each spouse’s income and anything purchased with that income) automatically becomes community property owned by each spouse equally.

Only certain property constitutes property owned separately by one spouse, including property acquired by one spouse before the marriage, inheritances, and personal injury damages.

Louisiana married couples can opt-out of the community property regime by agreement. A prenuptial agreement, for example, might specify specific types of property, such as investment income or business proceeds, that will belong separately to one spouse or the other, even if acquired during marriage.  

In divorce, Louisiana law presumes that community property will be divided equally between the divorcing spouses, unless they agree otherwise. 

Hiding Assets in Divorce Proceedings is Illegal

A popular misconception holds that hiding assets is a routine practice in divorce proceedings, and that divorce lawyers help their clients do it. 

Not so. Divorcing spouses in Louisiana have an obligation under the Civil Code to account to one another for community property. They also owe a duty to preserve and prudently manage former community property in their control pending its division and distribution. 

Hiding assets in divorce runs afoul of these obligations, making the wrongdoer spouse legally liable to the other for damages. It may also constitute a crime under Louisiana law, such as when it causes a false accounting to be made or amounts to an illegal transmission of monetary funds. Hiding assets by transferring or moving them across state lines could even constitute a federal crime. 

Divorce attorneys in Louisiana may not facilitate or participate in the hiding of assets, and they face potential fines, loss of licensure, and criminal penalties if they do. 

The Warning Signs of Asset Hiding

That doesn’t mean, however, that hiding assets from a spouse in divorce never happens. It does, sometimes because divorcing spouses do not realize it’s a serious violation of the law, and sometimes because divorce can cause people — especially those who do not have a skilled divorce lawyer representing them — to do ill-advised things  

In other words, you are not wrong to worry about the possibility of your spouse hiding assets, especially if you spot any of the following warning signs in the days and weeks on either side of your separation: 

  • Sudden or large drops in your shared bank or brokerage account balances, or in the amount of your spouse’s take-home pay.
  • Your spouse moving valuable property, such as artwork, antiques, fine wine, cars or boats from your residence to another location.
  • Your spouse renting a storage unit or unexpectedly driving to visit family living out-of-town or in neighboring states. 
  • Your spouse buying expensive items, such as jewelry or collectibles, especially if paid-for in cash. 
  • Your spouse asking you to sign financial documents you do not understand. 
  • Receiving notifications from financial institutions about changes in account information or passwords. 
  • Receiving bills for credit card accounts you do not recognize. 
  • Not receiving financial statements and bills that usually arrive monthly.
  • Your spouse using your residence or other valuable property to secure loans to pay for a new business venture.
  • Your spouse making loans to friends or family. 
  • Your spouse suddenly taking interest in new or unusual investment opportunities.  

These are merely examples. Any financial or property-related actions by a spouse in the time period shortly before and after a separation can raise a red flag. Speak with an experienced Louisiana divorce attorney about your suspicions right away. 

What You Can Do

The most proactive way to fight back against asset-hiding in divorce is to make sure you have a clear, thorough understanding of your marital finances while you are still married. 

If that is water-under-the-bridge, however, then your next-most effective option is to contact an experienced divorce attorney as soon as your spouse’s actions seem suspicious, and to update your attorney regularly about any developments. 

Louisiana law gives divorce attorneys a wide array of tools to use in uncovering and combating asset-hiding in divorce proceedings. These include requesting disclosure of information from your spouse, seeking court intervention and sanctions, and even (when necessary) alerting authorities to potentially criminal conduct.  

The sooner you contact an attorney, the broader the range of options and the better protected your rights. 

Attorney Betsy A. Fischer Can Help

The financial power imbalance in your marriage can make it seem impossible to prevent your spouse from hiding property from you in your divorce. 

With the help of a skilled, experienced divorce attorney, however, you can stop that misbehavior in its tracks. 

Attorney Betsy A. Fisher has spent 27 years advocating for spouses in the process of divorcing and dividing their community property. Contact her online or call 504-780-8232 to discuss your concerns that your spouse is hiding assets from you. 

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