During a high-asset divorce, one problem that sometimes arises is that one person will attempt to hide assets from their spouse. Maybe they have an individual bank account that they simply fail to disclose to the court, and they transfer some of their financial resources into this account to keep them out of marital property division.
It is important to be aware of this issue, as you may need to use forensic accountants to track down these hidden assets. But there is another potential issue to consider, known as the dissipation of marital assets. This is a bit different and generally focuses on spending those assets, especially in a way that is inconsistent with previous spending patterns.
Looking for red flags
By dissipating marital assets, your spouse is just spending them prior to the divorce. For instance, maybe the two of you have a bank account with $20,000 in it. If it was split up evenly, you would both receive $10,000. But if your spouse spends the entire $20,000 on travel and entertainment in the months before the divorce, then you get nothing. They benefit from whatever they purchased with those marital funds, and they cut you out of the equation, meaning that you lose assets you otherwise deserved.
This is why it is important to look for red flags, such as unexpected financial transactions, increases in spending, unexplained purchases and more. It is true that people do need to spend money during a divorce, and the amount they spend could be quite significant during a high-asset divorce. But it is when there are changes to these spending patterns that problems can arise, especially if it looks like someone is intentionally wasting marital funds.
If you find yourself in this position, it is crucial that you know what rights you have and what legal options you can utilize while going through property division.