Hidden Assets Attorneys In Santa Monica, CA
Hiding assets doesn’t just pertain to those going through a divorce. Suspecting that your spouse is hiding their assets can be extremely damaging to your trust in them. Consulting with a skilled Santa Monica hidden assets lawyer is key to protecting your finances and well-being.
Kramer & Zitser, LLP, provides legal guidance to individuals facing asset concealment either during marriage or divorce. Our firm is based in Los Angeles and led by two senior family law attorneys who have combined years of experience and understanding of the intricacies of California family law.
The cost of living in Santa Monica is 113% higher than the national average. With Santa Monica’s leading industries being management, arts, media, sports, and business and financial operations, many wealthy individuals need proper legal representation to help protect them.
Understanding Hidden Assets and Community Property in California During Divorce
Sometimes, especially during emotionally charged divorces, a spouse may attempt to hide income, investments, or other assets. As outlined in California Family Code Section 2100, California law requires full financial disclosure from both spouses. This includes all assets and debts, whether owned together or separately, as well as any income and expenses.
The purpose of this requirement is to help protect the rights of each spouse and ensure fairness in dividing assets during divorce. In general, assets fall into two categories: community property and separate property. Community property includes anything either spouse earned or acquired during the marriage, no matter whose name is on it. Separate property includes assets owned before marriage, personal gifts, inheritances, and any income those separate assets produce.
This remains separate property as long as they are kept separate throughout the duration of the marriage and are not mixed with any community property. Because divorces can often come with intense negative emotions and stress, California Family Code Section 2100 also encourages both sides of a divorce to cooperate and be honest with each other about their assets.
Penalties for Hiding Assets During Divorce and Filing Timelines
Cases involving hidden assets are filed through the Los Angeles County Superior Court at the Santa Monica Courthouse at 1725 Main Street. Each person must give full and accurate financial information early in the case and must keep updating that information if anything important changes. This way, when it’s time to reach an agreement or go to trial, both parties understand the facts clearly and completely.
In California, if someone hides assets during a divorce, there can be serious consequences. According to California Family Code Section 1101, they could lose more than half of the hidden assets. Second, they may have to pay for the other spouse’s attorney’s fees and court costs.
There can be even harsher punishments if the court decides the hidden asset is a serious breach of trust. In those cases, the court can award 100% of the hidden assets to the other spouse. If you suspect your spouse is hiding their assets, you have three years from the date of discovery to file a claim with the court. However, in divorce proceedings, there is no time limit for filing a claim.
Hidden Income
Hidden income can also impact any spousal support (alimony) awarded. If one spouse underreports their income and assets, the court may order a lower alimony amount. California courts work to ensure fairness in each case they oversee, and if it’s discovered that someone has knowingly misrepresented their assets, heavy penalties are involved.
It’s important to get this situation solved in a timely manner, especially if you have a prenuptial agreement with your spouse. Not disclosing assets honestly during prenuptial agreement drafting can void the prenup, putting your rights at risk.
Red Flags That May Indicate Hidden Assets
It can be hard to recognize signs that your spouse is hiding assets, especially in marriages with a diverse estate. In Santa Monica in 2023, the median household income was $109,739. This is 5.97 times higher than the United States’ median household income of $303,400, making Santa Monica a city of high-asset individuals. Common methods of hiding assets during marriage or during divorce proceedings can include:
- Using secret bank accounts
- Removing valuables from safe deposit boxes
- Manipulating income. If your spouse is the owner of a business, a sign that they may be hiding business assets can include using company accounts for personal expenses to underreport wealth.
- Purchasing high-value items. Art, jewelry, and collectibles may be used to convert cash into items that are easily undervalued or stored away.
- Transferring ownership of property, accounts, or funds to a third party. In 2023, 8% of Santa Monica’s population owned homes.
If you suspect your spouse is moving money to family members, friends, or shell companies, it may be an attempt to shield property. Tracking property ownership in these cases requires title searches, tax record reviews, and corporate investigations.
- Underreporting cash earnings or overpaying taxes. Excessive tax payments may be used to defer income until after the divorce is finalized.
These tactics are common in divorces involving affluent individuals, especially those with high levels of control over their own income. Kramer & Zitser, LLP has years of experience handling cases involving clients with high assets.
Legal Process for Addressing Hidden Assets
If you suspect your spouse or soon-to-be ex-spouse is hiding their assets, contacting a knowledgeable attorney to help you with the next steps is vital. You then want to:
- Gather all financial documents, including bank records, tax returns, property deeds, and investment statements.
- Make a timeline of odd financial activity, such as big purchases, new accounts, or missing money.
- Compare past spending patterns to what’s happening now.
In a divorce, an experienced attorney can ask the court to freeze certain accounts or force your spouse to provide documents to back their claims. A divorce attorney can also issue subpoenas or request formal legal interviews to get more information.
They can also consult with a forensic accountant. A forensic accountant investigates financial records to find any signs of missing money, hidden accounts, or misreported income. They look into all financial areas, such as bank accounts, investments, and real estate. Their job is to make sure everything is properly reported and valued during the divorce.
Contact Our Team Today
At Kramer & Zitser, LLP, our goal is to protect the financial future of clients navigating high-asset divorce in Santa Monica. If you believe your spouse is hiding assets, our team can take immediate legal steps to recover those assets in accordance with California law. Contact our Los Angeles office today to discuss your case and protect your rights.
