In a divorce case in Louisiana, many spouses worry about being treated fairly in the division of property process. Louisiana is a community property state, in which joint marital assets must be evenly divided, but many spouses take steps to conceal assets from the other spouse and thereby attempt to avoid having the court include these assets in the inventory of community property. This tactic is plainly illegal, but more than a few people have believed that they could outwit the system.
Accountants may identify many of the devices used to conceal assets, and knowing about these devices can help ensure a fair division of property. A common method of hiding income is to postpone the award of a bonus or a pay raise until after the divorce is final. Another tactic is the purchase of a luxury or expensive item before the divorce and then under-reporting the value of the asset. Another method is the withdrawal of unusually large amounts of money from joint or individual bank accounts. Some people involve their friends by "paying back" a phony loan or selling a high value asset to a friend for far less than fair market value and then reversing the sale after the divorce is final. The most common method of hiding assets is simply to actually hide them, that is, omit high value assets from the financial disclosure that the court will require during the divorce.
A spouse who suspects the other spouse of hiding assets can take a few preventive measures. The review of past tax returns can show common patterns of income that may be disrupted to prevent discovery of current income. Similarly, a review of the activity in all bank and investment accounts may reveal efforts to move assets overseas. If the suspect spouse makes a loan application prior to the divorce, the financial information submitted in support of the loan may provide clues to the hiding of assets.
Every party to a divorce in Louisiana must make a full and accurate disclose of all assets and debts. Also, both parties must provide accurate and complete answers to questions about financial assets. The failure to do either of these may lead to penalties from the court.