In a Colorado divorce, both spouses must fully disclose their finances. This includes income, property, debts and assets. When one person hides money or property, it can seriously affect the fairness of the final settlement.
Below are common signs of hidden assets and their impact on the property division process.
Common signs of hidden assets
There are several red flags to watch for. These may include:
- Unexplained withdrawals or transfers
- Sudden changes in financial behavior
- Missing bank statements or tax returns
- Overpayments to the IRS or credit cards
- Large purchases or gifts to friends or relatives
Some spouses may also move money into a business, delay bonuses or claim an asset was lost or devalued.
Why it matters
Colorado follows the principle of equitable distribution. This means the property is divided fairly. Courts look at many factors, including the economic situation of each spouse. If one person hides assets, the court cannot make a fair decision. The other spouse may end up with much less than they deserve.
Hidden assets can affect not just property division, but also spousal support and other financial orders.
If hidden assets are suspected, the other spouse can gather financial records, request disclosures or raise concerns during the discovery process. This process allows each side to ask for information under oath. Courts take non-disclosure seriously. A judge may penalize someone who fails to disclose assets or lies under oath.
In some cases, experts such as forensic accountants may help uncover hidden property.
Being aware of these signs and understanding the process can help protect your financial interests during a divorce. You should also seek legal guidance.