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Is hiding assets during divorce illegal in California?

Most high-income individuals are on guard during divorce proceedings and it's easy to see why. They oftentimes have considerable wealth they know could be divided and awarded to their soon-to-be ex-spouse. Fearing their hard work and investments will have been for naught, divorce can sometimes cause high-income individuals to take risky actions, like hiding assets.

Hiding assets can take many forms, from transferring money to secret accounts to withdrawing crash in small amounts over time, and can be driven by malice or a need to protect one's assets. Whatever the case, it's important to note that doing so in California can create major legal problems for the guilty party.

Failing to report all community property

Generally speaking, most assets - as well as debts - accrued by both spouses during the course of marriage is considered community property. When filing for divorce, couples in California are required to declare all separate and community property. After careful review, a judge determines an equal split of community property. If assets are hidden, though, a judge cannot evenly divide community property.

Failure to disclose property accurately - even if it was done with good intentions - can be construed as giving false or misleading information to the court, which is a crime in our state under ยง118 of the California Penal Code. Doing so could constitute perjury, which may be punishable by time in jail or other legal actions, which up to the judge's discretion.

Hiding assets is a risky decision

Whether you're thinking of hiding assets to protect the wealth you've worked so hard to create or simply want to hurt your soon-to-be ex, know that the decision to hide assets is ill-advised. Hidden assets can be discovered through court proceedings or by forensic accountants hired by your spouse. In the end, you could end up facing serious legal consequences as well as significant damage to your reputation if word gets out.

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