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Top Tips for Dealing With Undisclosed Assets in Family Law Matters

by | Jan 17, 2024 | Family Law

Navigating family law disputes is inherently complex, but when one party attempts to conceal their assets, it adds an extra layer of challenge. It is not uncommon for this to happen; attempts to conceal assets often stem from one party’s desire to preserve their own financial interests, manipulate financial outcomes and/or gain an unfair advantage.

If you are facing such an issue, the good news is that there are several ways to deal with undisclosed assets in family law matters. It is important for you to know what to look for and what steps to take to build a strong case.

At Nevett Ford, our family law lawyers are well-versed in navigating the matter of undisclosed assets in domestic disputes. As such, we have compiled a guide on effective strategies to empower individuals and ensure the greatest chance of a fair and transparent resolution.

The Duty of Disclosure: Upholding Transparency
Firstly, understand that it is a legal duty to transparently disclose one’s assets in family law matters. The Federal Circuit and Family Court of Australia (Family Law) Rules 2021 impose a duty of disclosure on both parties as is required of them by the other involved party. This means that if asked, both parties must disclose the full list of their assets and liabilities to the other person.

This principle is critical to the start of any family law case because it allows each party to gain the full financial picture. The findings will then form the foundation for awards and claims, as well as potentially impact the judgment.

Given how fundamental this Rule is to a fair dispute resolution, it is vital to note that a failure to comply can have significantly adverse consequences for the offender – not just in terms of costs, but also in the division of identified assets.

Subpoena Power: Compelling Third-Party Disclosure
Despite legal requirements, parties in a family law dispute may still opt to withhold critical assets and financial information maliciously. In situations where Court proceedings are already ongoing, one party can request the Court to issue a formal written order, known as a subpoena, to compel third parties such as banks to produce necessary documents.

In Latin, subpoena means ‘under threat of punishment’. This step is usually taken when the other party is refusing to comply with disclosure requests with transparency and in good faith. However, the effectiveness of a subpoena relies heavily on how it is crafted.

It is important to carefully craft the request so that it accurately specifies what is sought and can guide the recipient on the correct documents to produce. If the request is too broad, the resulting documents may not be relevant or useful to your case. As such, it is important to enlist the aid of lawyers who understand how to word the request for optimal effectiveness.

Restraints and Injunctions: Freezing the Trail
When family law disputes arise, it is common for parties to begin attempting to move or conceal their financial assets, especially if they have liquidity.

Awareness is key here. If you notice any suspicious account activity or irregular financial transactions in any assets that you can access – for instance, a series of unexplained payments in your bank statements that suggest misappropriation of funds – it may be helpful to engage legal aid to seek a restraint or freezing order on the affected account from the Court.

Due to the highly restrictive nature of such orders, they are not commonly obtained. However, if successful, these orders can even be directed to the bank so that the person in question has no choice but to stop their banking activity. This greatly limits their ability to manipulate finances and provides peace of mind that assets remain intact while the case is ongoing.

Searches: Leveraging Technology to Uncover Hidden Assets
There are many ways for determined individuals to conceal or obfuscate financial assets, including the creation of shell companies or transferring monies to third parties to hold for them. It can be tedious to follow the money trail, but advancements in technology have greatly streamlined this process in recent years.

At Nevett Ford, we can access searchable databases for real estate and companies across most Australian jurisdictions. We can search these databases by standard details such as name, company name and address, as well as more personal information such as the names of intimate partners and/or family members to attempt to identify hidden assets.

Being able to uncover these financial footprints first-hand is a valuable advantage. It reduces dependence on Court orders for visibility and enables you to make more strategic decisions.

Forensic Accountants: Unravelling the Money Trail
After one party in a family law dispute produces financial declarations for evaluation, it is up to the other party to verify that the finances are all in order – and, if not, to highlight any issues. However, it is often difficult for an untrained eye to detect financial manipulation or wrongdoing on paper.

This is where forensic accountants can be a valuable resource. As trained professionals, they can be employed to review and analyse the documents on your behalf to see if the money trail makes sense or if any leakage is occurring.

With their expert help, you gain a greater understanding of where and when to look, as well as what to ask to put the other party to the test. This provides more confidence in achieving a fair resolution to the dispute.

Navigate Family Law Disputes with Nevett Ford
It can be frustrating to deal with undisclosed assets in family law disputes, but with an informed, diligent and multi-faceted approach, you can ensure greater transparency and better protect your interests in pursuit of a fair resolution.

At Nevett Ford, we have a wealth of experience in dealing with recalcitrant parties to family law disputes and exploring avenues to ensure financial transparency is achieved.

To find out how we can help your case, contact our experienced Family Law team today at 03 9614 7111 or melbourne@nevettford.com.au.