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  • Michael Anastasov

Hiding assets in a divorce

Family law property proceedings can be complex and protracted, especially in circumstances where one party does not provide their full and frank disclosure. It is therefore an obligation to provide full and frank disclosure with respect to Rule 6.01 of the Federal Circuit and Family Court (Family Law) 2021 (“Family Law Rules”). Specifically, the Family Law Rules state that each party to a proceeding has a duty to the Court and to provide each other with full and frank disclosure of all information relevant to the proceeding, in a timely manner.


This means that both parties have an obligation to disclose all their assets, liabilities, and financial resources they own or control. This includes savings, digital assets, property, superannuation, business interests and debts.


Consequences


If discovered that a party in the proceeding is hiding assets and has failed to provide their full and frank disclosure, consequences may be imposed. These include:


1.       Re-evaluation


The Court will likely re-evaluate the asset pool upon discovering that a party failed to provide an honest disclosure. This is likely to lead to an unfavourable outcome for the party attempting to hide information and assets.


2.       Cost Orders


Pursuant to Section 117 of the Family Law Act 1975, each party to proceedings in family law shall pay their own costs. However, there are exceptions to this general principle. One exception includes failing to produce documents in accordance with the duty to provide full and frank financial disclosure. If this is found, the Court may make an order for the non-complying party to pay the other party’s legal costs.  


3.       Penalties


In serious situations of non-disclosure or misleading information, the Court may order fines and impose penalties. Non-disclosure and concealing assets is considered contempt of the court.

 

Is this happening to you?


There are many strategies that are used to hide assets. However, the most common strategies include transferring assets, undervaluing assets, using offshore accounts, and creating fake debt. If you suspect that your ex-partner is hiding assets, you should contact a lawyer immediately. 


There is an obligation for both parties to be frank and honest in the process of financial disclosure. To ensure that you abide by this obligation, our team of specialist family lawyers is here to guide you through the process and help in any way possible.

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