Justine Flack, an Associate Solicitor with Howes Percival LLP, considers the issue of non-disclosure of financial assets within divorce proceedings.
A fundamental principle when dealing with the financial aspect of divorce is that each party will give full and frank disclosure of their assets and overall financial circumstances. However, the general mistrust that often accompanies marriage breakdown frequently leads to allegations that the other party will have hidden assets. This fear may also arise where one party has been the "financial brains" of the marriage and the other has had little involvement with monetary issues.
So, should you turn into Inspector Clouseau to try and get to the truth of the matter and start opening your spouse's post, riffling through their desk and hacking into their computer? The answer is no – this type of behaviour could land you in trouble and any documents found might be inadmissible in evidence in any event.
What you can do is think very carefully about your spouse's behaviour and raise concerns with your Solicitor. They know what to look for, where to look and how to appropriately gather the information in cases where non-disclosure is a genuine issue. If diligent, they will uncover assets. In complex circumstances, they may advise the instruction of an accountant who can also assist in following the audit trail and give a report detailing their findings. This will be far more persuasive to the Court than your own attempts at investigation.
The sort of behaviour that could indicate that your spouse is hiding assets or has been planning financially for the divorce could be as follows:
- Being secretive about financial matters and unwilling to discuss arrangements with you.
- Maintaining complete control of bank details and undertaking internet banking, refusing to divulge passwords.
- Arranging for bank statements to be delivered elsewhere and not to the house or converting to paperless banking via the internet.
- Travelling abroad more frequently than usual, particularly to countries with relaxed banking laws.
- Complaining of an income decrease but spending continues unchanged or frequently speaking of their business failing.
There are many other indicators but these are some of the more obvious. The impact of thorough investigation by your Solicitor is that firstly, hidden assets can be uncovered. Secondly, the Court may draw the inference that the behaviour of your spouse in not being transparent in their dealings and arrangements suggests that there may be other assets which remain undiscovered. The final settlement may then be structured in your favour to compensate for that possibility.
This was exactly the outcome in a recent case managed by Justine Flack of The Family Team at Howes Percival. Diligence in pursuing lines of enquiry regarding numerous bank accounts led to the discovery of a substantial "loan" to a business which the husband was associated with. That loan was not shown in the company accounts and was therefore otherwise untraceable. Further suspicion was aroused about the husband's activities because of his frequent trips to the Far East which he claimed were for business purposes but was unable to produce any evidence to substantiate that. The Judge concluded that the husband may have additional assets which he had failed to disclose. The final Order was structured favourably for the wife, compensating her for the husband's conduct and the increased legal fees brought about by his lack of co-operation. The Order also took account of the possibility of undisclosed assets thereby being generous to the wife in many aspects.
You should not therefore be too shy to talk to your Solicitor if you have concerns. They will be able to put your mind at rest, make appropriate enquiries and if felt necessary, instruct further experts who can assist. They will ensure that evidence is presented to the Court in the most appropriate manner to strengthen your case.