Unveiling the Risks: Hiding Assets in Arizona Divorce Proceedings

It is not uncommon for divorce to be stressful and contentious, especially when divorcing spouses have substantial assets. According to Arizona’s divorce laws, both spouses must equally and fairly divide all assets, debts, and property acquired during the marriage. During a divorce, some spouses hide assets from the court, and retains them rather than dividing them.

You should consult a divorce attorney in Prescott, AZ with experience in financial aspects if you suspect your spouse is hiding assets. Many spouses fail to notice signs that their spouse is hiding or failing to disclose significant assets during divorce proceedings. When a divorcing spouse recognizes signs of asset hiding, he or she can take appropriate action to resolve the issue. In Arizona, divorces and hiding assets isn’t just spiteful; it’s also illegal. Hiding assets obstructs the accurate determination of the assets to be divided.

What Is the Difference Between Community and Separate Property in Arizona?
In a contentious divorce, where a spouse may seek to conceal assets, the courts encourage divorcing spouses to reach mutually agreeable settlements regarding the distribution of marital property out of court. However, for spouses with substantial or complex assets, this can be challenging. To begin with, spouses must determine which assets are their separate assets that belong to them alone and which assets belong to the marital community that need to be divided. In Arizona:

  • Any assets, accounts, debts, real estate property, cars, and valuables owned by one spouse alone before marriage, and any assets inherited by them or gifted to them during the marriage, are considered separate property.
  • All accounts, assets, debts, real estate properties, cars, household items, electronics, antiques, collectibles, and artwork acquired by both spouses during the marriage are considered community property or marital property.

Depending on the circumstances, a spouse may also be entitled to claim the separate property of the other spouse. One spouse may have a valid claim on a portion of the commingled property if, for example, the other spouse grants them access to an account or makes improvements to their property. According to family law in Prescott, AZ, it is the spouse’s responsibility to prove that the property or asset is their separate property during the settlement process.


In a Divorce, What Are Hidden Assets?
Divorce lawyers in Prescott, AZ, refer to hidden assets when they talk about any asset, account, property, or value that one spouse fails to disclose during the divorce to keep it separate from the pool of community assets that will be distributed equally. Cash, bank accounts, investments, retirement accounts, valuables, real estate property, or business interests may be among a spouse’s hidden assets.


What Are the Signs That My Spouse Is Hiding Assets?
In some cases, spouses hide assets in obvious ways, but in many cases, they do so in subtle and unnoticeable ways. The following red flags may indicate asset hiding in an Arizona divorce:

  • Money slowly eroding from an account
  • The sudden or slowly building increase or decrease in a spouse’s typical spending habits
  • When a spouse abruptly stops paying his or her bills
  • Account statements and bills that stop arriving in the mail or by email
  • An unusual gift or loan from a spouse to family or friends
  • Expensive purchases made by a spouse
  • Spouse invests suddenly in cryptocurrency
  • During a divorce, one spouse declares an unexpected drop in income
  • Account access is suddenly blocked, the password has changed, or financial programs have been removed from your computer
  • There are unexplained withdrawals from joint accounts
  • Tax documents and financial records differ from your spouse’s lifestyle

If any of these signs apply to your soon-to-be ex-spouse, he or she is likely concealing or disposing of assets you could claim for equal distribution after the divorce.

Divorcing spouses in Arizona must fully disclose their financial information during the divorce process. Those who fail to do so may be prosecuted for perjury and other offenses.

Divorce in Arizona: Understanding Discovery & Disclosure
During the discovery period of a divorce in Arizona, each spouse must submit a full financial disclosure. As part of discovery, both spouses and their attorneys review the other spouse’s financial disclosure and may request additional documents. All assets, debts, income sources, and other relevant financial circumstances should be disclosed. If a spouse is trying to hide assets, he or she might do one or more of the following:

  • Failing to report bonuses, overtime, or commissions and claiming a lower income
  • Lie about their debts
  • Keep billing statements hidden
  • Invest in cryptocurrencies or transfer assets to overseas accounts
  • Keep cash and valuables in a safe or safety deposit box

To minimize the amount of income disclosed, some spouses ask their employers or contractors to defer salaries, commissions, and bonuses until after the divorce is final.

How to Investigate Asset-Hiding in an Arizona Divorce
It can be extremely difficult to uncover a spouse’s hidden assets. Be sure to speak with a divorce lawyer in Prescott during the discovery process if you suspect your spouse has hidden assets. Your family law attorney in Prescott, AZ, can then file motions to obtain the appropriate documents. Forensic accountants specialize in locating hidden assets in high-asset divorces. In addition to freezing your spouse’s accounts, your family law attorney in Prescott can also seek a court injunction to prevent them from transferring, concealing, or withdrawing assets until the distribution of marital assets is complete.

Hiding Assets During a Divorce in Arizona Carries Heavy Penalties
During divorce, a spouse could face serious consequences if they intentionally conceal, transfer, or dispose of assets. Examples include:

  • Penalties and fines
  • Legal fees to be paid by the other spouse
  • Your spouse is awarded more assets by a judge
  • Charges of criminal perjury with jail time upon conviction
  • Indictment for contempt of court

Fraud on the court is committed when assets are hidden during an Arizona divorce. In Arizona, this is a serious offense with long-term consequences.

When Hidden Assets Are Found After a Divorce, What Happens?
Even after the divorce is final, you can still recover your share of hidden assets. Upon gathering evidence, you can request a modification of your divorce decree to receive not only a share of the discovered assets but also interest, attorneys’ fees, and any additional expenses you incurred. A subsequent lawsuit, however, should be avoided whenever possible. Due to this, it is beneficial to conduct a comprehensive asset search during the divorce.

At Willison Law, PC we help divorcing clients locate and recover hidden assets. To schedule a consultation with Stephanie, call 928-445-3534 or contact us online.



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