Taking steps to ensure a fair outcome in a divorce financial settlement
Divorce can be a challenging process, especially when one party is not being entirely honest about their financial situation. In the UK, both spouses are legally required to provide full and frank financial disclosure. Despite this, an individual may attempt to hide assets to reduce their financial obligations in a settlement. If you suspect that your spouse is concealing money or property, it is crucial to take action to ensure a fair outcome.
How do people hide assets during divorce?
Spouses may use various methods to conceal wealth, including:
- Undervaluing property – claiming a lower value for real estate or businesses.
- Transferring money to family or friends – temporarily “gifting” money or assets to be returned after the divorce.
- Delaying bonuses or salary increases – deferring income until after the divorce is finalised.
- Using offshore accounts – moving money to overseas accounts that are harder to trace.
- Overstating debts – creating fake debts to reduce the net worth of the marital estate.
How to uncover hidden assets during divorce
If you suspect your spouse is not being truthful about their finances, there are steps you can take:
- Review Financial Disclosure Forms – in the UK, both parties must complete a Form E, which details their financial situation. Carefully reviewing your spouse’s disclosures may highlight inconsistencies or missing assets.
- Obtain Bank and Financial Statements – request copies of bank statements, tax returns, and investment accounts for at least the last three years. Look for unexplained withdrawals, transfers, or unusually low balances.
- Examine Business Interests – if your spouse owns a business, they may manipulate company accounts to underreport income. A forensic accountant can assess whether business assets and revenue have been intentionally misrepresented.
- Check for Property Holdings – land registry searches can reveal whether your spouse has undisclosed property holdings. A solicitor can assist in tracking down real estate assets that may not have been declared.
- Use Court Orders if Necessary – if you have strong reasons to believe your spouse is hiding assets, your solicitor can apply for a Search Order or a Freezing Injunction to prevent them from disposing of assets before the financial settlement.
Legal consequences of hiding assets during divorce
Attempting to hide assets in a divorce is taken seriously by UK courts. If a spouse is caught, the court may:
- Impose financial penalties
- Set aside any dishonest agreements
- Award a larger share of assets to the other spouse
- In extreme cases, impose criminal charges for perjury
This publication is a general summary of the law. It should not replace legal advice tailored to your specific circumstances.
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