Ideally, a divorcing couple will manage to have an amicable, collaborative divorce. The divorce will move forward relatively problem-free and both parties will walk away satisfied with the divorce settlement. But, we don’t live in a perfect world. Some divorces are the opposite and they are troublesome due to a flurry of negative emotions, such as anger, resentment, spite, and jealousy.
When couples have extra cash laying around or when they are of high-net-worth, and there is a lot of animosity between the spouses, sometimes one spouse will waste the couple’s marital assets. When this happens it’s called “dissipation of marital assets” or “wasteful dissipation of marital assets.” You’d have a hard time finding a divorce attorney who hasn’t witnessed this phenomenon first-hand.
How Can a Spouse Waste Assets?
There are lots of ways a spouse can waste marital assets. While spending $500 on a single shopping trip at Whole Foods or buying the most expensive pair of prescription glasses at the optometrist probably won’t count, dropping $75,000 on a new boat, “loaning” $15,000 to your sister so she can pay off a student loan, or spending $10,000 on plastic surgery may be a whole different story.
In many cases, a vengeful spouse will blow thousands over a weekend in Las Vegas, put their girlfriend up in a fancy apartment, or take a lavish solo vacation. Usually, this spouse is the breadwinner and he or she would prefer to throw money away than have to split it with their soon-to-be-ex.
“I think my spouse is wasting our money so I don’t get my hands on it. Is there anything that I can do?” For starters, in California, once you file for divorce, you get protection through what’s called an Automatic Temporary Restraining Order (ATRO), which prevents either of you from doing anything that would alter your financial status, such as making a big purchase, transferring assets, or draining a joint bank account.
If you have significant assets and suspect that your spouse is hiding something, you may want to get a forensic accountant in your corner. Forensic accountants are highly-skilled in locating hidden assets in high-net-worth divorces.
“Is there any way to get the money back, or is it lost forever?” If you can prove that your spouse has intentionally wasted marital assets, it could certainly impact the divorce settlement. For example, if a cheating husband was found to have spent $30,000 in a year paying for his girlfriend’s apartment, a judge could order that his wife receive $30,000 more in the settlement just to punish him for his misconduct.
Do you suspect your spouse is wasting or hiding marital assets? Contact our San Diego divorce firm to schedule a free case evaluation.