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04 Aug 2017

Hiding assets on divorce

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Suspicious spouses, mistrustful that their ex may be hiding assets in the context of divorce proceedings, should tread carefully.

What information must be provided in a divorce?

The Courts deal with the division of finances separately from the divorce itself. If an application for financial remedies is issued by either spouse the Court will order both parties to complete detailed financial statements, setting out a full picture of their finances. As part of this they will both be required to provide 12 months’ worth of bank statements for each bank account and all investments they hold, as well as property valuations, pensions statements, and documents regarding their income (whether P60’s and payslips or tax returns and company accounts).

Are there limits on how I am allowed to obtain information about my ex’s finances?

Often people take it into their own hands to try to take documents (in hard copy or electronically) without permission. This is likely to be viewed by the Courts as illegal and you may face civil or criminal charges, or an order to pay costs. Your ex might also try to get an injunction against you and you will be ordered to return all copies to your ex without keeping anything. Your credibility in the financial proceedings will also be damaged, perhaps irretrievably.

Can I open my partner’s post and use information from that to prove they have more than they have stated?

It is a criminal offence to open a person’s post without their consent. The fact that you are still married is not a defence.

What happens if I have already taken documents or computer files?

You should return them immediately to your ex, and confirm you are not holding on to any copies.

I think my partner is hiding assets from me; can I use a private investigator to find out more?

If you employ a private investigator, he or she will be bound by the same rules that apply to you in relation to obtaining documents. Hacking into email accounts and breaking into filing cabinets is strictly off-limits. Nowadays, therefore, the role of the sleuth is really limited to finding out details of your ex’s lifestyle which may be relevant to your financial claims. This may include evidence that he/she is living with a new partner (which may affect his/her housing and income needs) or evidence as to whether he/she is working or has not been open about his/her business arrangements. Private investigators will often be skillful at obtaining information from social media such as Facebook, Twitter, and Instagram.

Commonly private investigators have always been called upon by either side to find out whether the other is cheating. However in practice even if either (or both) parties are cheating it will generally have no effect on the outcome of the financial proceedings.

I know my wife’s password, can I access her emails and use that information?

The question you need to ask yourself is “would my wife agree to my accessing her emails”. If the answer is “no” a Court would say that you should not access her emails.

Documents and emails will still be considered confidential even if they are not protected by passwords and so even if your wife has stored documents on her computer without locking them that doesn’t mean you can simply access and copy the documents.

So what can I do if I suspect my ex hasn’t sent me everything she should have?

The Court may make further orders for disclosure and impose penalties such as costs and ultimately orders for your ex to be sent to prison. It can also make “search and seize” orders or orders that assets be “frozen” until the divorce proceedings have finished. The problem is these applications are expensive and can be difficult to get as the Court requires a high standard of proof.

A more practical solution may be to focus on the Court’s power to draw adverse inferences: if convinced by what you tell them about the extent of your ex’s assets (for example if you provide detailed evidence as to a lavish lifestyle) the Court can make an order on the basis that it assumes a certain amount of money is available, despite what your ex has disclosed. Even then, that is only the first hurdle, and orders made for large cash settlements can be very difficult to enforce without evidence of the specific assets. The court can use the weapon of prison against spouses refusing to pay but this is not guaranteed of success.

Divorces are stressful and will inevitably be made worse if your ex tries to hide assets. However, it is vital that you do not do anything illegal, no matter how tempting, as you will face the might of the law (both civil and criminal). The best advice is to tread carefully and seek advice from a specialist family lawyer at the earliest opportunity.

This article originally appeared on Thisismoney.co.uk and Daily Mail Online in July 2015.