While many Michigan residents are aware of the statistic that nearly fifty percent of all marriages will end in divorce, couples usually do not marry thinking they will inevitably divorce. But despite the best of intentions, divorce can happen. When it does, both parties are required to disclose all assets as part of the legal divorce process and for equitable division of assets and property.
Assets include one’s income, debt, expenses, investment and the like. Despite the legal requirement of asset disclosure, divorcing couples may be tempted to withhold such information or underreport to prevent losing that asset. Some common tactics used include overstating debts and actual expenses, underreporting actual income and undervaluing marital property. According to the National Endowment for Financial Education, about one-third of adults who combined their assets were deceptive about money matters with their partner.
Deliberately hiding assets during a divorce proceeding is illegal and has serious consequences for the party withholding the information. For instance, the party not disclosing information may be found to be in contempt of court and may be fined or required to pay the other party’s attorney fees. In one case, a Michigan court discovered that a husband had deliberately hidden assets during the divorce proceeding and subsequently awarded his wife the entirety of the discovered assets.
It is important for divorcing couples to understand the legal consequences of their actions. Divorce is an emotional process and emotions may cloud one’s judgment. Thus, it is important for a person who is contemplating divorce or in the process of a divorce to understand their rights and obligations. It may be necessary to seek expert legal advice from an experienced family law attorney and ensure that a careful and honest evaluation of assets is conducted.
Source: Forbes, “What Are the Consequences of Hiding Assets During Divorce?,” Jeff Landers, Nov. 14, 2012
