High-asset marriages tend to result in some of the most challenging divorce-related litigation, as people are often eager to sidestep community property division rules in Texas. When those with diverse portfolios and sizable personal holdings divorce, there is plenty of both incentive and opportunity for financial misconduct in addition to general complexity that needs to be sorted out during negotiations, mediation and/or litigation.
One of the most common misconduct risks relates to one spouse deciding to hide assets from the other and also from the family courts. They seek to diminish the marital estate and routine assets that they should report and possibly divide. The choice to hide assets is a form of financial misconduct, and it can have a major impact on the results of divorce proceedings in Texas.
They skew the process unfairly
Someone who doesn’t know the true value of the marital estate can’t ask for their fair share of property and might agree to a very unreasonable settlement. Additionally, when the courts are unaware of the full extent of the marital property, the judge may not be able to effectively apply the equitable distribution statute to divide assets and debts. If people fail to uncover hidden assets, their spouses can unfairly deprive them of thousands of dollars in assets that they should have shared under community property statutes.
They can lead to appeals
The family courts do not often grant appeals on property division matters, regardless of how unhappy one spouse may be with the outcome of the process. However, one of the rare exceptions in which the courts will revisit a prior property division order is when someone has evidence of hidden assets. Lying to the courts during the discovery process opens someone up to consequences later, possibly including the loss of the assets that they attempted to hide. In most scenarios, those preparing for a complex, potentially high-conflict divorce may mean professional help evaluating their financial records for signs of hidden assets.
Locating hidden assets can help people secure a fair outcome to a process in which their spouse sought one that was patently unfair.