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The Walters Gilbreath, PLLC Blog

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Dirty Divorce Trick #4: Hiding Assets

by Brian Walters on May 1, 2017

Dirty Divorce Trick # 4 : Hiding Assets 

Playing dirty during a divorce is very common. Most of the time, spouses are angry or upset with each other and one (or both) of the spouses embark on a mission to ruin the other one. While some people spread untrue rumors or try to "expose" the other spouse, others try to ruin the spouse in a way that stings - by hurting the other spouse's pockets. In fact, one of the most common dirty divorce trick is hiding assets and/or income from the other spouse during the divorce. In fact, oftentimes the spouse was hiding assets from a spouse during the marriage too. However, this is not always known to the other spouse during the marriage as sometimes only one spouse will handle the finances, manage the financial accounts, and the like. 


These dirty tricks are real and do happen often. If left unchecked they can lead to a negative outcome for the affected spouse. If you’re not careful, you could receive an unfair outcome when your divorce is final.

Much like everything else, the first step is to identify the problem. The next step is to take corrective action when the problem is recognized. When you suspect that your spouse is hiding something, be sure that it isn’t community assets. If it is, be sure to let your attorney know as soon as possible. 


Hiding Assets from Your Spouse in Anticipation of a Divorce

Sometimes a spouse will hide assets when they know that divorce litigation is impending or imminent. Most commonly, the spouse that controls the money or other assets hides some or all of those assets (and documentation evidencing the value(s) of those assets) from the other spouse in the anticipation of the divorce.

I want you to consider the all too-typical scenario of a breadwinner husband who makes more money and also controls the finances. The wife has access to the joint bank account from which she goes shopping, pays certain expenses for the children, and otherwise goes about her daily business. Husband pays all of the household bills and expenses. Even though the wife may have access to the joint account, she may not necessarily know exactly how much money the husband has, is making, or where the husband’s putting money besides what hits that joint bank account.

Dirty Divorce Trick #5 : Starving the Other Spouse Financially

Another dirty financial trick is when the spouse who controls the purse strings cuts off the other spouse or severely restricts their financial support. Divorce attorneys call this, “starving the spouse.” The goal of this trick is to force the dependent spouse to give up and agree not to fight the case in court so that the spouse with the financial leverage secures a better deal. Quite frankly, the independent spouse can usually fund the litigation upfront, with the money that they have stowed away or earned. The other spouse (that may be unemployed) may have to either borrow the money for the litigation or may seek the money from the Independent spouse in a court of law. 

Consider this Hypothetical Scenario :

A husband and wife have been together for 25 years. The husband was a military man, ultimately reaching the level of Lieutenant Colonel. He retired and took a civilian contractor job. The wife raised the children and was unemployed (though raising the children was a job in itself). Eventually, the wife reached an age in life where it would be unlikely that she could re-enter the workforce. The husband had a dominant personality; the wife was more submissive. This couple was what many refer to as "traditional" or  "old school". In other words, the wife was a homemaker and the husband was the breadwinner. Over time, the finances became a controlled situation, where the husband would “give” a certain sum of money every month to the wife, just like an allowance. If wife needed more money, she would simply ask for it, and the military husband would give it. Eventually, these two headed for divorce. The military husband, always the one in the relationship to spell out the parameters of a deal, laid it on the line to the wife;  husband would agree to give her X years of alimony at Y number of dollars. She better take it, he said, or he would cut her off completely and leave her with nothing. Wife felt overwhelmed and highly pressured to settle the divorce prematurely. 

Time and time again, this hypothetical scenario has played out. Time and time again, the dependent spouse believes the statements of the husband since that’s how they operated during the marriage and that was the dynamic they had. So if the husband says that a certain bank account does not exist, it is as good as law. The objective reality is that the husband would put himself in a precarious situation if he cut off his spouse that depends on him at any point before the divorce is final or during the proceedings. The court has the inherent power to order temporary support, sometimes even on an expedited basis, to make sure that the needs of each spouse are met, even while a divorce is still pending.

Dirty Divorce Trick # 6 : Intentional Un/Underemployment to Avoid Paying Support

In Texas, spousal and child support are heavily dependent on the net income of the paying spouse. Simply put, the more the paying spouse makes, the more he or she is likely to pay in support to their children and/or spouse. Another way of thinking about it is that if the paying spouse makes too little money, the court will be unable to order him or her to pay spousal support to the other spouse, and only nominal child support.

So, do you see why another common dirty trick is for the payor spouse to simply quit his/her job until the case is finalized? The thought process behind this trick is that the spouse could throw his hands up in the air and say, “Judge, I just don’t have any money to pay support.”

While this trick is common, the other spouse can fight back. Texas law allows a spouse to argue for imputation of income to another spouse if that other spouse is voluntarily unemployed or underemployed.

So for example, consider the case of a crane operator who during the marriage worked a 40-hour workweek and lots of overtime. In anticipation of his divorce, and not wanting to pay support to his spouse, the crane operator leaves his job and takes a job working in a supermarket instead. Of course, the crane operator has specific skills that will allow him to get back to operating cranes for as many hours a week as he wants — and that’s fully what the crane operator intends to do once his case is finalized, and the support obligations are taken care of.

In this fact pattern, the other spouse can argue to the judge that the crane operator spouse’s former wages should be imputed for purposes of calculating alimony and child support since he is intentionally underemployed. Then, the wife should argue, that alimony and child support should be based upon the former crane operator spouse’s imputed income, and not the current income while working at the grocery store.

Click Here to Proceed to Dirty Divorce Trick # 7 : Making Secret Copies

Topics: Child Custody, Dirty divorce tricks, hiding assets