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penalty for hiding assets in divorce Australia
08 Sep 2023

What Is The Penalty For Concealing Assets During Divorce In Australia?

By Family Lawyers Mackay, 08 Sep 2023
Divorce Property Settlement, Legal Help

Divorce is a challenging and emotionally charged process. When going through a divorce, it’s crucial to ensure that all assets are transparently disclosed and fairly divided. But what happens if one party attempts to hide or conceal assets during divorce proceedings in Australia? In this informative article, we’ll explore the penalties for concealing assets during divorce, provide expert insights, and answer frequently asked questions.

Penalties for concealing assets during divorce in Australia

Concealing assets during divorce proceedings in Australia is a serious offence. The legal system takes a dim view of any attempts to hide wealth or misrepresent financial circumstances. The penalties for concealing assets can vary depending on the severity of the deception and the extent to which it affects the divorce settlement. Here are some possible consequences:

Legal Consequences

  1. Financial Penalties: Individuals found guilty of concealing assets during the divorce may face substantial fines imposed by the court. These fines are meant to deter dishonesty and ensure a fair division of assets.
  2. Loss of Credibility: Concealing assets can lead to a loss of credibility in court. Judges may view the dishonest party as less trustworthy, potentially impacting their overall case.
  3. Compensation Orders: In some cases, the court may order the deceptive party to compensate their former spouse for the financial losses incurred due to the concealment of assets.
  4. Contempt of Court: If a court determines that a party has intentionally deceived the court or their spouse, they may be charged with contempt of court, which can result in further legal penalties.


By consulting one of our accredited family law mackay specialists.

Property Adjustment Orders

  1. Reopening of Property Settlement: If concealed assets are discovered after a divorce settlement, the affected party can apply for a property adjustment order to revisit the settlement and ensure a fair distribution of assets.
  2. Unequal Distribution: Courts may adjust property settlements to favour the innocent party, ensuring they receive a more substantial share of the assets.
  3. Legal Costs: The deceptive party may be required to cover the legal costs of the innocent party incurred in uncovering the hidden assets.

Criminal Charges

Criminal Prosecution: In extreme cases of deliberate deception, the concealment of assets can lead to criminal charges, including fraud and perjury. If convicted, the guilty party may face imprisonment.

Expert Insights

IAN FIELDTo shed further light on this topic, we contacted legal experts in Australia’s family law. According to IAN FIELD, a prominent family lawyer: 

Concealing assets during divorce is not only unethical but also illegal. Courts take a strong stance against dishonesty in divorce proceedings. Both parties need to provide full and accurate financial disclosures to ensure a fair outcome. Attempting to hide assets can result in severe consequences, including fines, property adjustments, and even criminal charges.

What Does Full Disclosure of Assets Mean in Property Settlement in Australia?

1. Transparency is Key

When embarking on a property settlement in Australia, it’s crucial to understand what ‘full disclosure of assets’ truly means. It goes beyond listing your possessions; it encompasses a comprehensive revelation of all your financial holdings, including real estate, investments, savings, and debts. The court requires both parties to provide this information honestly and transparently.

2. Expertise in Asset Valuation

Full disclosure also involves accurate valuation of assets. This is where expertise comes into play. Property appraisers, financial experts, and legal advisors may be consulted to ensure that assets are appraised correctly, leaving no room for disputes.

3. The Impact of Incomplete Disclosure

Please disclose assets fully to avoid severe repercussions. Not only can it delay the settlement process, but it can also lead to unfavourable outcomes in court. Courts expect parties to act in good faith during property settlement proceedings.


By consulting one of our accredited family law mackay specialists.

What happens when the court finds out that I have immediately transferred or disposed of my property before settlement

A Closer Look at Asset Transfers :

Some individuals resort to transferring or disposing of assets just before the settlement to avoid having them considered during the property division process. However, the court can see through such tactics and may treat these transfers with scepticism.

The Clawback Principle:

Courts employ the clawback principle to address such situations. If the court determines that an asset transfer was done to avoid inclusion in the settlement, it can be ‘clawed back’ into the property pool for division.

Fairness Prevails:

The clawback principle aims to ensure Fairness in property settlement proceedings. It prevents individuals from manipulating the system to their advantage and guarantees that all assets are considered during the division.

What Should I Do If I Know My Ex is Hiding Assets in a Divorce?

What Should I Do If I Know My Ex is Hiding Assets in a Divorce?Seek Legal Advice:

If you suspect that your ex-spouse is hiding assets during your divorce, seeking legal advice is crucial. An experienced family lawyer can guide you through the process and help you gather evidence to support your claim.

Mediation and Negotiation:

In some cases, disputes regarding hidden assets can be resolved through mediation and negotiation. Your lawyer can represent your interests and work towards a fair settlement.

The Role of Forensic Accountants:

Forensic accountants may be called upon to trace financial transactions and uncover concealed assets in complex cases of hidden assets. Their expertise can be invaluable in ensuring a just property settlement.

Common Strategies for Hiding Assets in Divorce

1. Offshore Accounts

One common strategy for hiding assets is to move funds offshore, where they are less likely to be detected. This can involve opening secret bank accounts or investing in assets located in foreign countries.

2. Undervaluing Assets

Some individuals may undervalue their assets to downplay their worth during property settlement proceedings. This can be done with properties, investments, or even business assets.

3. Concealing Income

Hiding Income is another tactic to lower the perceived financial worth during divorce proceedings. This can involve underreporting earnings, receiving cash payments, or hiding assets under other family members’ names.

Is Your Ex-Spouse Hiding Assets in a Divorce?

Signs to Watch For:

Identifying whether your ex-spouse is hiding assets requires vigilance. Some signs to watch for include:

  • Sudden and unexplained financial secrecy.
  • Unusual or suspicious financial transactions.
  • Discrepancies in reported Income and actual lifestyle.
  • Evidence of offshore accounts or hidden investments.


By consulting one of our accredited family law mackay specialists.

Take Action:

Taking action is essential if you suspect that your ex-spouse is hiding assets. Consult a family lawyer, gather evidence, and work towards a fair and transparent property settlement.


Property settlement during a divorce is a complex and emotionally charged process. Full disclosure of assets is not just a legal requirement; it is a fundamental principle that ensures Fairness and transparency in the proceedings. Hiding assets can lead to severe consequences, both legally and personally. It’s crucial to approach this process honestly, seek legal advice when necessary, and work towards a fair resolution that benefits both parties.

FAQs About Concealing Assets During Divorce in Australia

Q. Is concealing assets during divorce a common occurrence in Australia?

A: Concealing assets during divorce is not common, but it does happen. It is essential for individuals to be aware of the legal consequences and ethical implications associated with such actions.

Q. What should I do if I suspect my spouse is concealing assets?

A: If you have reason to believe that your spouse is concealing assets, it is advisable to consult with a family lawyer. They can guide you on the appropriate steps to take, including seeking legal remedies to address the issue.

Q. Can I protect myself from asset concealment during divorce?

A: To protect yourself from potential asset concealment, it is crucial to maintain open and honest communication with your spouse throughout the divorce process. Additionally, seeking legal advice and conducting financial due diligence can be beneficial.

Q. How can concealed assets be detected?

A: Concealed assets can be challenging to detect, but forensic accountants and experienced family lawyers are skilled at uncovering such deceit. They use various investigative techniques to trace hidden assets.

Q. What if I unintentionally failed to disclose an asset?

A: If you inadvertently failed to disclose an asset during divorce proceedings, it is essential to rectify the situation immediately. Consult with your lawyer to make the necessary disclosures to avoid legal consequences.

Q. Are there any amnesty programs for asset disclosure?

A: Australia does not have specific amnesty programs for asset disclosure during divorce. It is always advisable to adhere to the legal requirements and disclose all assets truthfully.

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