The rapid growth of cryptocurrency, complex corporate structures and digitally held wealth is reshaping the landscape of financial disclosure in UHNW divorce cases. This article considers the implications.

The following article, touching on aspects of divorce cases in England and Wales, comes from Caroline Park (pictured below the article), partner at Hughes Fowler Carruthers, and Jasmine Jones (pictured below the article), associate at the same law firm. The editors are pleased to share these views; the usual editorial disclaimers apply to guest writers’ articles. To comment, email tom.burroughes@wealthbriefing.com and amanda.cheesley@clearviewpublishing.com

“Oh what a tangled web we weave, when first we practice to deceive,” wrote Sir Walter Scott in 1808. More than 200 years later, nowhere is this web more complex than in an ultra-high net worth divorce.

In many ultra-high net worth divorces, wealth is spread across jurisdictions in a highly complex network of liquid and illiquid assets, business interests, investment structures and trusts. Where financial stakes are high and emotions run even higher, allegations of hidden assets and non-disclosure can escalate.

Some may be unfounded yet can still derail negotiations and lead to years of litigation. More strikingly, when concealment is proven, the financial consequences and reputational risks can be extremely serious.

Whatever the motivation for non-disclosure – be it a misjudged attempt at asset protection or driven by anger, fear or a desire for control - the legal position has been clear for decades.  Every divorcing spouse, regardless of their wealth, has an identical duty of full, frank, clear and accurate disclosure of their assets and resources during financial remedy proceedings.  

Against the backdrop of the globalisation of wealth and the sophisticated planning that underpins it, recent court decisions have again highlighted the consequences of failing to comply, and demonstrate the ongoing vigour in scrutinising complex wealth structures.  

In MK v SK, Mr Justice Peel considered allegations made by the wife that the husband had failed to disclose assets forming part of a trust structure. The court agreed, concluding that the husband had concealed wealth. It found he enjoyed access to undisclosed assets in a trust, some other structure or held by individuals on his behalf. This case serves as a reminder that the court looks beyond formal title and legal ownership to the reality of a party’s resources and their access to wealth. For the ultra-wealthy and their advisors, as well as family offices and trustees, this draws attention to the risks of informal arrangements and the importance of strong governance, clear documentation and anticipating future disclosure requirements.  

Last year, the case of Helliwell v Entwistle caught the headlines for its focus on financial non-disclosure in the context of a prenuptial agreement. The parties enjoyed a short, three-year marriage, prior to which they had entered into a prenuptial agreement. In the prenup, they each stated that they had “fully and frankly” disclosed to each other their financial resources and liabilities. In reality, the wife had not. She had failed to disclose assets amounting to 73 per cent of her wealth, including her business assets and a 50 per cent interest in property. The Court of Appeal found that the wife had deliberately failed to disclose this wealth and sent the case back to the High Court to assess the husband’s needs. The wife unsuccessfully appealed to the Supreme Court.

The significance extends well beyond this couple’s situation. It demonstrates that non-disclosure is not a gendered issue and that the need for accurate disclosure is not confined to the divorce proceedings - the disclosure requirements apply just as strongly when asserting full disclosure in a prenuptial agreement. Interestingly, prenup disclosure is often much more limited or high-level than that required on a divorce. For a prenup, financial information is typically provided in the form of a schedule or summary document. This lighter touch can be misleading.  If it falls short, especially when combined with an assertion that it is complete, the protection offered by the agreement may be substantially undermined. With the growing popularity of pre and postnuptial agreements, this issue will no doubt arise again. For advisors and wealthy future spouses alike, the costs of getting the disclosure wrong before the marriage even starts can be significant on a future divorce.     

Taken together, these recent cases build on a flurry of interest in financial non-disclosure around a decade ago. 

In the key case of Gohill in 2015, Mrs Gohill succeeded in persuading the Supreme Court to set aside the settlement order made 11 years earlier after evidence emerged of her former husband’s concealed wealth and money-laundering activity. In the meantime, Mr Gohill had been sentenced to 10 years in prison. The conclusion from the family court was clear: settlements muddied by material non-disclosure can be reopened many years after they were thought to be final. For Mrs Gohill, the final determination of her financial claims did not occur until May 2025, some 20 years after the separation, when the court was finally able to grapple with which assets were matrimonial property and untainted by her former husband’s criminal conduct.  She received the entirety of the identified untainted assets.

At the same time, the Supreme Court reinforced this principle in Sharland. Mr Sharland, a successful software entrepreneur, had misrepresented the value of his shareholding in his software business. Although it was difficult to determine with precision how the financial non-disclosure impacted the outcome of the case, this acted as no barrier to the original order being overturned. The court wanted it to be clear that a dishonest spouse cannot benefit from the uncertainty they create. 

A few years later, in Moher, the parties separated after a nine-year marriage. The court found that the husband had failed to comply with his obligation to give full and frank disclosure of his resources. He sought to challenge the decision, saying that the court had failed in not providing a single figure or bracket of figures in relation to his undisclosed wealth. He lost this argument. This case again reinforced that the court takes a dim view of financial non-disclosure and will not hesitate to draw adverse inferences against a non-discloser where required. 

In a world of increasingly sophisticated wealth planning, it is perhaps unsurprising that financial non-disclosure is once again in the spotlight.  

For very wealthy individuals, the message is clear: the duty of disclosure applies however and wherever assets are held. The recent authorities demonstrate the court’s continued willingness to scrutinise, look to the reality of the financial position and penalise non-disclosure. The costs of being caught can be severe – financially and reputationally - and orders can be revisited many years later. Complexity is not an excuse for concealment. 

For the financially weaker spouses of such wealthy individuals, the challenges can be greater. Most are not forensic accountants or divorce lawyers with decades of experience. Even highly educated and commercially sophisticated individuals may not have the background, knowledge, visibility or insight into family wealth to enable them to evaluate the financial disclosure of their higher earning or ultra-wealthy spouse. In many longer marriages, almost by default, financial expertise can become concentrated in one spouse’s hands.
 
This difficulty is compounded by the fact that allegations of non-disclosure are often raised at the very outset of cases, before there is any evidence to support this. A divorcing spouse may come to an initial meeting with deep mistrust of their spouse and concerns about hidden assets at the forefront of their mind. The crucial role for their advisors is to test these suspicions. Merely reviewing the disclosure provided is not enough - early, rigorous scrutiny is needed to challenge, probe and identify what is missing. 

Caroline Park, Partner Hughes Fowler Carruthers

Jasmine Jones, Associate Hughes Fowler Carruthers