How People Try to Hide Money During Divorce in California (and Why It Usually Backfires)
In California divorces, full and honest financial disclosure isn't just encouraged — it’s required by law. Hiding assets or income during divorce is illegal, carries serious penalties, and can significantly impact the final outcome of your case.
Despite these risks, some spouses are tempted to play games with money during divorce, thinking they can outsmart the system. But in reality, attempting to hide assets usually causes far more harm than good — including loss of credibility, increased legal fees, and possible financial sanctions.
In this post, we'll cover common ways people try to hide assets during a California divorce, warning signs to watch for, and how to protect yourself if you suspect dishonesty.
Why Hiding Money in Divorce Is a Costly Mistake
If you attempt to conceal income, property, or accounts during your divorce, it can severely damage your credibility with the court — and that credibility is often your most valuable asset.
Consequences of hiding assets can include:
Losing your share of the hidden asset entirely,
Paying financial sanctions or covering your spouse’s attorney’s fees,
Facing long-term reputational damage and possible criminal charges for perjury
In addition, once trust is broken, divorce cases become longer, more expensive, and more combative. Formal investigations, subpoenas, forensic accounting, and litigation replace more efficient options and can sabotage opportunities for settlement — costing both parties substantially more time, money, and stress.
Common Ways People Try to Hide Money During Divorce
If you’re concerned your spouse may be hiding money or manipulating financial records, here are some of the most common tactics to be aware of:
1. Small Cash Withdrawals and "Cash Back" Tricks
Some spouses quietly withdraw cash from joint accounts leading up to divorce, hoping the amounts are small enough to avoid notice. They may:
Request "cash back" during routine purchases
Withdraw inconsistent small amounts across different accounts
Use the cash for untraceable personal spending (luxury hotels, gifts, infidelity-related expenses)
Hoard cash with the intention of hiding it from asset division
Important: In divorce proceedings, both parties have the right to obtain full banking and credit card records — and third-party subpoenas can uncover hidden transactions if necessary.
2. Removing Valuables from Safe Deposit Boxes
Safe deposit boxes often hold not just important documents like deeds and passports, but also high-value items like jewelry, gold, collectibles, art, or large sums of cash.
A spouse may:
Remove cash and valuables to "lose track” of them from the marital estate
Take original financial documents to try to obscure ownership or account information
Keeping a detailed inventory and pictures of safe deposit box contents is a smart habit — both for divorce protection and general financial organization.
In a divorce, you have the right to demand disclosure of safe deposit box records, including directly from the bank, and courts can compel access to such records if needed as well.
3. Hiding or Deferring Income
Self-employed individuals often have greater opportunities — and temptations — to manipulate income reporting. Common tactics include:
Underreporting cash earnings
Inflating business expenses
Deferring invoicing until after divorce finalization
Paying phantom employees or vendors to mask funds
Even W-2 employees sometimes engage in misconduct by:
Asking employers to defer bonuses or promotions
Splitting direct deposit into new undisclosed accounts
Stashing raises or commissions into new financial vehicles
In a divorce, both parties are entitled to a full review of business and employment records — including tax returns, pay stubs, contracts, promotion records, business expense records, accounting records and more. Financial forensic experts can also trace irregular income patterns.
How to Protect Yourself if You Suspect Hidden Assets
If you have any reason to believe your spouse is concealing income or assets during your divorce, it's critical to act thoughtfully and strategically.
Steps you can take:
Work with a skilled family law attorney experienced in asset tracing and discovery
Obtain full financial disclosures early — including bank records, investment statements, business documents, and employment records
Consider using forensic accountants or financial experts to analyze discrepancies
Preserve copies of all existing financial records in your possession
Seek court assistance if disclosures or discovery are incomplete or suspicious
It’s generally not advisable to retaliate by hiding assets or income yourself. Staying credible and transparent protects long-term financial interests and positions a person strongly with the court.
Key Takeaways: Hiding Money During Divorce in California
Hiding assets or income during a California divorce is illegal and can lead to severe penalties.
Common tactics include secret cash withdrawals, removal of valuables, and manipulation of income reporting.
Both parties have legal rights to access complete financial information — and hidden misconduct is often uncovered through subpoenas and forensic analysis.
Attempting to hide assets usually leads to higher legal fees, longer court battles, and worse financial outcomes.
The smartest move is to be fully transparent and work with an experienced attorney to protect your rights and interests.
Final Thoughts
Financial transparency is one of the cornerstones of an efficient, fair divorce process — especially when significant assets are involved.
At our firm, we specialize in representing professionals, business owners, executives, and individuals with complex financial portfolios during high-stakes California divorces. If you are concerned about hidden assets or navigating complex financial disclosures, contact us today for a confidential consultation.
—
Emily Rubenstein Law PC is a full service divorce and family law firm. We proudly serve Beverly Hills, West Hollywood, West Los Angeles, Santa Monica, Culver City, the South Bay, Glendale, Pasadena, Sherman Oaks, Studio City, Encino and all of Los Angeles County.
Give us a call or check out our website:
(310) 750-0827 | www.emilyrubensteinlaw.com
Emily Rubenstein Law, PC is a full-service divorce and family law firm. We proudly serve Beverly Hills, West Hollywood, West Los Angeles, Santa Monica, Culver City, the South Bay, Glendale, Pasadena, Sherman Oaks, Studio City, Encino and all of Los Angeles County.
On your side,
Emily Rubenstein, Esq.
Founding attorney
You Might Also Find These Helpful
