Claims of fraud may arise during the marriage or divorce if one spouse made a material misrepresentation about the value of assets or income. Fraud may be actual in which the individual had the intent to defraud the other spouse and the intention to deprive the other spouse from having fair use and enjoyment of the marital assets. Alternatively, fraud may be alleged to be constructive, meaning that there was not necessarily ill intent but that the spouse should have known that the actions would deceive the other spouse.
Fraud claims are largely fact-specific and based on state laws. Some states include statutes regarding marital fraud during the divorce to include any transfers of marital assets that were not fair to the other party.
Successfully bringing a fraud claim during the course of divorce or after the final settlement may impact a number of issues relevant to the divorce settlement. For example, it can impact the amount of spousal support that is awarded. Additionally, some courts may transfer the entire value of the asset that has been hidden or disposed of to the victimized spouse, rather than treat it as a 50/50 ownership under community property rules.
Rather than going through civil procedures to attempt to restore a person’s financial status after such a theft, victims may choose to pursue criminal charges against the spouse who wronged them. As part of the criminal process, the thieving spouse may be required to pay restitution to the victim.