If you are contemplating divorce, you may be feeling overwhelmed by the entire process. Divorce not only requires the parties to divide assets, but forces both to consider alimony, child custody and support issues as well. Parties are often emotionally drained and exhausted at the notion of accounting for all marital property, which is a lengthy process for some divorce cases. As well, parties may attempt to conceal certain assets from the court in order to avoid splitting or losing the property during the equitable distribution process. Nonetheless, hiding assets during a divorce in Vermont could lead to serious civil and criminal penalties.
Schedule of Assets
When parties decide to divorce in Vermont, both must submit to the court a schedule of assets and liabilities. Known as the Form 813B Financial Affidavit, parties are required to fill it out if they are divorcing with children, the court orders completion of the form or one party requests the other to fill it out as part of the discovery process. The discovery process is used in civil lawsuits (including family court matters) to allow both parties the opportunity to request material and relevant information from the other. Parties must disclose whether they own jointly or individually assets in several categories, including real estate, retirement accounts, titled personal property (e.g., cars, boats), businesses, jewelry, artwork, collectibles and recreational vehicles. Parties must disclose the amount of cash they have on hand as well. Prior to filing the form with the court, each party must have the affidavit notarized, promising that the document contains no intentional omissions or false information.
Common Asset-Hiding Tactics
Divorcing spouses may employ a number of asset-hiding tactics during divorce. Common tactics to watch for include hoarding large sums of cash in a safe deposit box or overpaying creditors to deplete cash on hand. A spouse may also attempt to overpay in quarterly or annual taxes with the intent to receive a large refund after the divorce is finalized. Spouses have also attempted to defer or delay commissions, bonuses and salary payments due until after the divorce is final. It is similarly not uncommon for a spouse to make abrupt transfers of stock or underreport income on loan applications or tax statements, as these documents are often used in the divorce discovery process to determine an appropriate alimony amount.
Fraudulent Court Documents
Under Vermont law, parties in a civil action (i.e., divorce proceedings) are prohibited from submitting falsified documents to the court. In addition to the personal court sanctions the litigant could face for this practice, his attorney could also face suspension or disbarment for knowingly participating in the preparation of a falsified pleading. Your Financial Affidavit contains a section for you to sign where you affirm the truthfulness of the document. Sanctions for lying, which is known as “false swearing,” can include imprisonment not to exceed 15 years, a fine up to $10,000 or both.
Modification of Divorce Order
If a divorce is already finalized and one party later discovers the other may have concealed assets, the court may reopen the case to reconsider the distribution of property. The Vermont court may only modify the property division order upon a showing of fraud or coercion. If you can show through an accounting or other evidence that your spouse hid assets during the divorce proceedings, the court may reconsider any issues in your divorce pertaining to assets, including child support and alimony. If the divorce is not finalized and the court has entered a temporary order of property division, you may make a motion in court to modify the order by showing a substantial change of circumstances.