When spouses separate in New York, the division of assets can quickly become contentious—especially if one spouse may be hiding property or income. As a Brooklyn divorce attorney at Gilmer Law Firm, PLLC, I’ve seen firsthand how financial concealment can upend what should be a fair process. In this post, I’ll explain how courts handle hidden assets in divorce, your rights under New York law, and the tools we use to ensure proper equitable distribution.
Why Hidden Assets in Divorce Are So Problematic
Under New York’s equitable distribution system, marital property must be divided fairly—though not necessarily equally. But how can fairness be achieved if one spouse conceals income or fails to disclose investments? That’s why transparency is not optional.
The law requires each spouse to provide a sworn Net Worth Statement, listing all assets, income, liabilities, and recent transfers. This rule is designed to expose concealed property and to give courts the tools they need to ensure fairness.
Marital Property vs. Separate Property
Before identifying concealment, it’s important to understand what property is subject to equitable distribution.
- Marital property includes nearly all property acquired during the marriage, regardless of whose name is on the title.
- Separate property includes premarital assets, inheritances, personal injury awards, and certain gifts.
- But separate property can lose its status if it is commingled—mixed into joint accounts, retitled into both names, or used for marital purposes.
When one spouse claims property is separate, they must prove it. The burden is on them to trace funds and keep them clearly apart from marital assets. If they fail, courts will often treat the property as marital and divide it under equitable distribution.
Red Flags That Suggest Concealed Assets
Spouses conceal property in many ways. Warning signs of hidden wealth include:
- Sudden withdrawals or transfers to relatives or shell companies
- Businesses that claim losses while funding a lavish lifestyle
- Cryptocurrency wallets or undisclosed brokerage accounts
- Retitling property into new LLCs, trusts, or partnerships during separation
- Shifting ownership of valuable assets to insiders before filing for divorce
Other states recognize similar patterns. For example, Justia’s overview of hidden assets describes concealment strategies common in their jurisdiction. While I don’t practice law in that state, it provides useful comparative insight.
How a Brooklyn Divorce Attorney Uncovers Hidden Assets
When I represent clients, we use New York’s strong disclosure rules and investigative tools to uncover undisclosed property.
1. Sworn Net Worth Statements
Every divorce begins with sworn statements of net worth. Courts rely on them to establish the foundation for equitable distribution, and attorneys test them for accuracy.
2. Aggressive Discovery
We can demand documents such as:
- Tax returns, bank statements, and credit card records
- Business ledgers, corporate books, and partnership agreements
- Loan applications that reveal a spouse’s “real” income
- Deeds, titles, and property transfer records
These are critical to revealing undisclosed assets.
3. Depositions and Oral Testimony
Under oath, a spouse can be questioned about finances, transfers, or business operations. Inconsistent answers often point toward concealment.
4. Forensic Accounting
Experts can trace money through complex transactions, uncover offshore accounts, or expose manipulated business valuations. Forensic work is often the key to exposing hidden assets.
5. Business Entities and LLCs
Spouses sometimes use LLCs or closely held companies to shelter wealth. Courts can “pierce the veil” if the entity is just a cover. For more detail, see our guide on how an LLC is treated in a divorce.
6. Sanctions and Court Oversight
New York courts may impose sanctions if a spouse refuses disclosure, including fines, exclusion of evidence, or negative inferences. These enforcement tools discourage concealment and support equitable distribution.
Educational Resources
If you want to explore this issue further, consumer resources can help. For instance, Nolo’s article on hidden assets in divorce provides useful tips. Remember, though, every divorce is unique, and only a Brooklyn divorce attorney who knows New York law can protect your interests.
What If Assets Surface After the Divorce?
Sometimes property doesn’t come to light until after a judgment is entered. New York law allows continued discovery or reopening of cases if concealment or fraud is proven. That means even after the divorce is finalized, you may be able to seek your fair share.
Why Vigilance Matters in Brooklyn
Brooklyn divorces often involve real estate, family businesses, and investment accounts. Concealed property can dramatically affect your financial future. That’s why equitable distribution isn’t just a legal concept—it’s your safeguard for fairness.
As a Brooklyn divorce attorney, my role is to:
- Ensure sworn disclosures are complete
- Push for aggressive discovery when needed
- Work with forensic accountants to expose hidden wealth
- Advocate for fair equitable distribution in negotiations or trial
If you suspect your spouse may be hiding assets, acting quickly is critical.
Final Thoughts
Uncovering hidden assets in divorce requires legal strategy, persistence, and expert support. In New York:
- Net Worth Statements are mandatory and enforceable
- Discovery covers the entire financial history of the marriage
- Courts may sanction noncompliance and draw negative inferences
- LLCs and corporate shells can be pierced
- Post-judgment discovery remains possible in cases of fraud
At Gilmer Law Firm, PLLC, we fight to ensure no stone is left unturned. If you’re facing divorce in Brooklyn and suspect hidden assets, contact us today to protect your rights and secure your financial future.
