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What does 'dissipation of assets' mean?

If you're contemplating divorce or you believe that your spouse is, it's essential to start getting your financial house in order with the help of your Florida family law attorney, a financial advisor and perhaps a forensic accountant. Otherwise, you could find that your spouse has blown through a significant amount of your marital assets to avoid having to divide them up with you.

There's a name for that practice -- "dissipation of assets." It often happens when one spouse has a considerably larger income than the other or significant individual assets of his or her own. They have plenty of other money that they won't have to divide. Therefore, often out of spite or greed, they spend large amounts of marital assets on travel, cars and other luxuries for themselves or others.

The best way to prevent this is with an Automatic Temporary Restraining Order. This is designed to keep spouses from changing the couple's financial status quo once a spouse files for divorce. However, it's still essential, even with an ATRO, to keep an eye on your joint credit cards and bank accounts for any large or unusual activity.

To claim that your spouse has violated the ATRO, you must show that the expenditure was substantial, frivolous and unusual. If your husband has always had a penchant for gambling and he continues it, that wouldn't necessarily qualify. Likewise, if your wife buys her new boyfriend a wallet, that may not be significant enough to be a violation. If they fly off on a month-long vacation at the Ritz Paris, that would be another matter.

Forensic accountants can help spot transactions that are ATRO violations. They can also help dig up hidden assets such as overseas accounts that you may have claim to in the divorce settlement. When your marital assets are significant, it's essential to have a good legal and financial team in place to protect your financial future after a divorce.

Source: Forbes, "What Is Dissipation Of Assets In Divorce And What, If Anything, Can You Do About It?," Jeff Landers, accessed Dec. 23, 2016

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