Going through a divorce is already hard enough. But what if your spouse is secretly hiding money or property?
It can make everything unfair, and you might not get what you deserve.
Your spouse could be moving money to secret accounts or might be giving property to friends or family. Which can destroy your financial future.
Alberta law protects you from asset hiding. There are severe penalties for hiding assets in a divorce in Alberta.
This guide shows you what happens when someone hides assets during divorce. Learn how to spot the warning signs and what to do about them.
What Does Hiding Assets Mean in Divorce?
Hiding assets means one spouse tries to keep money or property secret during divorce because they don’t want to share it fairly with their partner.
Here are common ways people hide assets:
- Opening secret bank accounts
- Lying about how much money they make
- Moving property to someone else’s name
- Giving money to friends or family to hold
- Saying they owe more money than they really do
All of these actions break Alberta law. They can lead to serious trouble.
Alberta’s Strict Laws for Financial Disclosure
The Family Property Act requires complete honesty. Both spouses must tell the truth about all their money and property.
Section 31 of the Alberta Family Property Act says spouses must provide a sworn statement. This statement must list all property they own. It must include property in other places too, not just Alberta.
The Divorce Act also requires ongoing disclosure. If something changes during the divorce, people must tell the court immediately. It creates a duty to keep information current throughout the process.
4 Common Ways People Hide Assets
- Business Interests: Business owners lie about how much their company is worth. They change financial records or wait to get paid after divorce. They move assets to companies owned by friends.
- Secret Bank Accounts: People open hidden accounts in other countries or use Bitcoin to hide money. These are hard to find.
- Giving Property to Others: People give valuable things to friends or family to hold during divorce. They plan to get everything back later.
- Lying About Income: Self-employed people call personal money a business expense. They keep money in their company to make their income look lower for support payments.
How to Spot Hidden Assets
Warning Signs in Money Behavior: Watch for these changes in your spouse’s financial habits:
- Sudden increase in cash withdrawals
- Opening new bank accounts without telling you
- Large transfers to family members or friends
- Paying off credit cards with huge payments
- Getting loans or gifts from relatives
Business-Related Warning Signs: If your spouse owns a business, look for:
- Declining reported income despitea maintained lifestyle
- Unusual business expenses that don’t make sense
- Reluctance to share financial records
- New partnerships with friends or family members
Lifestyle vs. Income Mismatches: Pay attention when your spouse’s reported income cannot support their observed spending patterns. This suggests undisclosed income sources that need investigation.
Legal Tools to Find Hidden Assets
Forensic Accounting Services Special accountants who find hidden money by looking at tax records and bank statements for unusual patterns.
Court Orders for Discovery Alberta courts can force people to share financial information through subpoenas that make banks and employers give records.
Freezing Orders (Mareva Injunctions) Court orders that stop people from moving or hiding their money until the divorce trial is finished.
Search Orders (Anton Piller Orders) Special court orders that let investigators search someone’s property without warning to find important financial documents.
Penalties for Hiding Assets in Divorce in Alberta
In Alberta, hiding assets during divorce can result in severe penalties, including unequal division of assets, court orders to pay legal costs, and contempt of court leading to fines or jail time. More severely, hiding assets can lead to criminal charges for fraud or perjury, potentially resulting in a criminal record and restitution.
Financial and Property Penalties
Unequal Asset Division: The court can award a larger share of the disclosed assets to the honest spouse instead of the standard 50/50 split.
Payment of Legal Costs: The spouse who hid assets may be ordered to pay all legal costs incurred by the other party in discovering them, including expensive forensic accounting fees.
Imputed Income: The court can estimate higher income for a spouse who fails to disclose properly, affecting support calculations.
Court and Legal Penalties
Contempt of Court: Under Rule 10.52 of the Alberta Rules of Court, non-compliance with court orders for financial disclosure can lead to contempt of court, resulting in fines up to $25,000 and imprisonment until compliance.
Court-Ordered Disclosure: The court can order third parties (like banks or friends who received assets) to provide financial information.
Criminal Charges: In serious cases involving false documentation, hiding assets can be considered criminal fraud or perjury, potentially leading to criminal charges, fines, and imprisonment.
Other Consequences
Criminal Record: A criminal conviction for fraud or perjury results in a permanent criminal record that affects future employment and professional licensing opportunities.
Forensic Investigation Costs: The honest spouse may need to hire forensic accountants to trace and locate hidden assets, adding significant complexity and cost to the case.
Why Full Disclosure is Crucial
Full and honest disclosure of all assets, debts, and income is mandatory in Alberta divorces and is in the best interest of both parties, as hiding assets only postpones the inevitable and complicates the legal process.
How Hiding Assets Affects Divorce Settlements
When one spouse hides money, it tricks the court into making unfair decisions. The honest spouse gets much less than they deserve, while the cheater keeps more for themselves.
This also hurts support payments because the court thinks there’s less money available. Kids don’t get enough support, and the honest spouse can’t afford to live properly.
Judges lose trust in people who hide assets. This can hurt their chances of getting custody of their children. Sometimes hidden assets are found years later, and the court can reopen the case.
Hiding assets always backfires and makes things much worse for the cheater.
Preventing Asset Hiding in Alberta Divorces
Document Everything: Start collecting proof right away:
- Copy all financial papers
- Take pictures of valuable items
- Write down spending patterns
- Save money-related emails or texts
Get Help: Talk to a divorce lawyer. You might need:
- A special accountant who finds hidden money
- A private investigator
Ask the Court for Help: Your lawyer can ask the judge to:
- Order your spouse to share financial information
- Stop your spouse from moving money
- Let investigators search for documents
Act Fast: Don’t wait. Starting early helps you:
- Stop more hiding
- Find important proof
- Get court protection
The Bottom Line
Hiding assets during divorce in Alberta causes serious trouble. Courts can fine people up to $25,000 and give them less property. Some people might even go to jail.
Being honest about money is always better. Alberta has strong laws that catch people who hide assets. Courts can easily find hidden money and punish cheaters.
Tell the truth about all your money and property. This keeps you safe and makes your divorce fair. Don’t risk your future by hiding assets.
FAQ
What happens if I accidentally forget to disclose an asset?
Honest mistakes are treated better than hiding on purpose, but you must tell your lawyer right away when you find the mistake.
Can I be forced to pay for my spouse’s investigation costs even if nothing is found?
Yes, you might have to pay if your spouse had good reasons to think you were hiding money, especially if you didn’t cooperate.
Can I protect some assets by putting them in my children’s names?
No, giving your property to your children during divorce to hide it is illegal and the court will take it back.
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