If someone is using their family members to hide money or assets to avoid obligations (e.g., alimony, child support, or dividing marital property), this is a form of fraudulent transfer or asset concealment. Courts take this behavior seriously, as it undermines the legal process and can unjustly harm the other party. Below is a comprehensive guide on how to address this situation:
1. Recognize the Signs of Asset Hiding Through Family
The following behaviors may indicate someone is using family to conceal assets:
- Transferring Assets: Moving money, property, or valuables to a family member’s name without legitimate reasons.
- Creating Fake Debt: Claiming they owe money to family members to reduce their net worth.
- Using Family-Owned Businesses: Hiding assets within a business owned or controlled by family members.
- Undervalued Transfers: Selling assets to family members for far less than their market value.
- Joint Accounts or Trusts: Stashing money in accounts jointly held with family members or placing assets in trusts they control.
2. Gather Evidence of Concealed Assets
To prove that assets are being hidden, you’ll need evidence. Some key steps include:
Request Financial Disclosures
- Request the court to order comprehensive financial disclosures, including:
- Bank accounts (joint and individual).
- Property ownership records.
- Business financial statements.
- Recent asset transfers.
Investigate Unusual Transactions
- Look for large withdrawals or transfers to family members, unexplained debts, or significant changes in financial records.
Analyze Public Records
- Check property records to see if assets were transferred to relatives.
- Look for business registrations or ownership stakes linked to family members.
Monitor Lifestyle vs. Claimed Income
- Compare their claimed financial situation with their actual lifestyle. For example, if they claim low income but live in luxury, it suggests hidden assets.
Engage Experts
- Forensic Accountant: Can trace financial transactions and identify hidden assets or transfers to family.
- Private Investigator: Can uncover concealed assets or property held in family members’ names.
3. Legal Actions to Address Hidden Assets
File a Court Motion
- Request Discovery: File a motion for discovery, compelling them to provide detailed financial information, including:
- Proof of any transfers to family members.
- Details of business ownership or trusts.
- Bank statements, tax returns, and property deeds.
- Subpoena Family Members: If necessary, subpoena family members to testify or provide documents showing their involvement in the asset concealment.
Assert Fraudulent Transfer Claims
Under Spanish law (or similar laws in other jurisdictions), fraudulent transfers to avoid financial obligations can be challenged:
- Transfers made to defraud creditors or avoid financial obligations can be voided under fraudulent conveyance laws (e.g., Article 1291 of the Spanish Civil Code).
Request a Forensic Audit
Ask the court to order a forensic audit of their financial records. This audit can uncover hidden accounts, property, or other assets transferred to family members.
4. Consequences for Asset Concealment
If proven, hiding assets through family can lead to serious consequences, including:
- Reversing Transfers: The court may void transfers to family members and return the assets to the original owner for proper division.
- Penalties: The person hiding assets could face fines or sanctions for violating court orders or engaging in fraudulent behavior.
- Loss of Credibility: Hiding assets damages their credibility in court, potentially leading to unfavorable rulings in the overall case.
- Criminal Charges: In severe cases, asset concealment may lead to fraud charges.
5. Protect Your Rights
Hire an Experienced Lawyer
- A lawyer specializing in family law, financial disputes, or asset concealment can:
- Draft motions and subpoenas.
- Build a strong case to expose hidden assets.
- Navigate complex financial and legal proceedings.
Request Interim Measures
- If you suspect asset hiding, request interim measures (e.g., freezing accounts, restricting asset transfers) to prevent further concealment.
Seek Compensation
- If the concealment has caused financial harm, ask the court to award compensation or adjust financial settlements accordingly.
6. Prevent Future Asset Hiding
Court Monitoring
- Request court-supervised financial reporting or audits to prevent further concealment.
Restrict Transfers
- Ask the court to issue an injunction preventing the other party from transferring or selling assets without approval.
7. How to Proceed
If you suspect your partner is hiding assets through family members:
- Gather as much preliminary evidence as possible without alerting them.
- Consult with a lawyer to evaluate your case and decide the next steps.
- File a motion in court to uncover the hidden assets and challenge fraudulent transfers.
