A spouse’s gambling addiction can take a serious toll on family finances. Whether the issue involves sports betting apps, lottery tickets, video poker, casinos, or another form of gambling, the financial consequences can be severe. Associated expenses like high interest on credit cards, fees for cash advances, lower credit scores, loan denial, and the threat of bankruptcy can feel like a ticking time bomb. If you are considering divorcing a gambler in Arizona, it is crucial to understand how your spouse’s gambling can impact the process.
Perhaps most significantly, Arizona is a community property state, which means that assets and debts acquired during the marriage are divided approximately equally between spouses during a divorce. When a spouse gambles away assets or hides debts, the resulting financial impacts can change the way property is divided. If your spouse is a habitual gambler, learn more about how to divorce a gambling spouse. Then, consult with an experienced Arizona family law attorney like the team at The Valley Law Group to protect your finances and your future.
How Gambling Impacts Divorce in Arizona
Several kinds of gambling are legal for Arizonans over the age of 21. The Arizona State Lottery offers scratch-off tickets, Powerball, Mega Millions, and many other state and multi-state games. In addition, multiple tribal casinos, several online sportsbooks, and a variety of apps like DraftKings and FanDuel are permitted to operate in Arizona. Betting is also authorized at live horse racing events.
Unfortunately, gambling has been linked with higher divorce rates, according to BMC Psychiatry, with as much as a 5% increase in instances of divorce over couples where neither spouse is a gambler. In addition, disordered gambling is heavily linked to individuals remaining single longer than desired.
As mentioned, gambling can place financial strain on a marriage, leading to depleted savings, higher debt, and bankruptcy.
In addition, gambling problems can contribute to:
- Trust issues between spouses due to hiding or lying about losses, borrowing money, and other deceptive behaviors that foster resentment.
- Emotional neglect when gambling takes time and attention away from family responsibilities.
- Arguing over gambling habits, spending, debt, and other conflicts between spouses.
- Addiction, anxiety, depression, stress, and substance use can push couples further apart.
- Illegal behavior, including stealing, fraud, or unregulated gambling.
Claims of Waste
When a couple in Arizona divorces, the court follows the community property principle. This means that all assets and debts acquired during the marriage by either spouse or both spouses are divided evenly during a divorce. Certain reckless or wasteful financial decisions, including the loss of significant marital assets to gambling, can be covered by a provision called a Claim of Waste.
When a person squanders or destroys community property, including by accruing gambling debt in Arizona, their spouse can file a Claim of Waste, especially if the losses were significant. These losses can be construed as financial infidelity, which can also include actions like hiding debts, secret financial accounts, or draining joint savings. If the court rules in favor of the Claim of Waste during a gambling addiction divorce in Arizona, the judge may order an uneven division of property and may even impose financial penalties on the wasteful spouse.
Is Gambling Debt Marital Debt in Arizona?
As a general rule, marital debt – that is, debt acquired during the marriage, regardless of the length of the marriage – is split between spouses when they end their marriage. This means that debt accrued by either spouse is divided along with debt accrued by both spouses together. Debt accrued by each spouse before the marriage or after separation is generally considered separate property and not part of marital debts.
Claims of Waste provide an important exception when approaching spouse gambling debt for divorce in Arizona. When gambling can be proven as a wasteful dissipation of the couple’s marital assets, meaning one spouse wasted or misused marital funds or property intentionally or recklessly, the gambling debt is considered a separate debt. Therefore, it is not the other spouse’s responsibility.
It is crucial to point out that the Arizona Family Courts views reckless spending, addiction, and illegal gambling as marital misconduct. While Arizona is a no-fault divorce state, such misconduct can still have an impact on how marital property is divided. Courts seek a fair and equitable distribution of assets, so when it is found that one spouse misused or wasted funds, a judge may order an uneven split of the remaining marital property to offset the value of the dissipated assets.
When the behavior involves illegal acts such as unregulated online betting, it may also have an impact on child custody and support. In some cases, such behavior can lead to criminal charges and penalties. Similarly, if gambling or financial instability impacts the parent’s ability to care for their children, it can mean a negative impact on parenting agreements or legal action to recover unpaid child support.
Proving Wasteful Dissipation or Financial Misconduct
Demonstrating a spouse’s wasteful dissipation is the responsibility of the spouse who files the claim. Unfortunately, it can be difficult to prove wasteful dissipation or financial misconduct, especially when there are hidden debts or accounts related to gambling. But hidden gambling debt in divorce in AZ is not as uncommon as you may think. In fact, a recent poll from the National Endowment for Financial Education revealed that 43% of U.S. adults admitted to financial infidelity.
If you believe your spouse is wasting marital funds, a critical first step is to collect financial records, such as bank and credit card statements, as well as any records related to gambling, such as records from casinos. A skilled divorce attorney can then request a subpoena to get additional information and evidence. During your divorce trial, you may be able to work with other professionals, such as forensic accountants, to discover other hidden assets.
The Importance of Disclosure
Arizona requires that both parties in a divorce disclose all pertinent information about finances and assets. Failure to do so can have serious consequences with the court, including fines and other sanctions, reassessment of asset division, and damaged credibility. These factors can impact child custody, spousal maintenance, and distribution of marital property.
Information that must be disclosed during the divorce process includes:
- Statements and details of bank accounts, investment and retirement account records, statements for loans, credit cards, and other debts, and liabilities
- Salary, wages, and other employment income, including financial documents from any businesses owned, rental income, dividends, tax returns, pay stubs, contracts, and other proof of income.
- Details of all marital and separate property, including vehicles, electronics, furniture, jewelry, all real estate, artwork, and other valuable items.
- Policies, coverage details, and premiums for all insurance, including life, health, vehicle, property, and other
- Records and expenses related to children. Healthcare, education, childcare, and other necessities
It is also important to note that excessive spending or gambling losses that happen during the marriage may be treated differently from those that happen after the couple separates. During the marriage, the debts are assumed to be marital property unless otherwise proven. However, after filing for divorce, each spouse must carefully monitor how they use any shared assets or risk additional legal issues related to community property laws.
Protecting Yourself: What You Can Do During Divorce
Understanding Arizona’s laws regarding divorce and property division is only one step in the process of protecting your finances in your divorce.
There are other critical steps necessary to safeguard your financial future.
- Hire a Divorce Attorney – A knowledgeable family law attorney can help you determine which is right for your specific circumstances.
- File for Divorce ASAP – This creates a legal separation date that will prevent you from absorbing responsibility for new debts. Arizona does not require a specified separation period before a couple can divorce; the only requirement is that at least one spouse must be a resident of Arizona for at least 90 days to file for divorce.
- Request a Financial Restraining Order – This temporary order can freeze joint accounts or restrict financial decisions to minimize existing financial damage and prevent further damage. In some cases, family court judges may grant such requests to limit new debt and reduce the risk of additional loss of assets.
- File a Claim for Dissipation of Marital Assets – If you have reason to believe that your spouse’s gambling led to the loss of marital assets like shared income or savings, you can request a larger share of the remaining marital assets to offset the gambling losses your spouse incurred. Evidence can include bank accounts, gambling records, and other similar documents.
- Get Approval to Move Individual Assets and Income – In some cases, you may be able to request that financial institutions put limits on joint accounts. Generally, once you file for divorce, you can move your income to a separate account and close joint accounts, but make sure you check with your attorney to ensure compliance with community property laws.
- Check Your Credit Report – You can request a copy of your credit report from Equifax, Experian, and TransUnion, and if necessary, you can place a freeze on your credit to prevent any new loans or accounts from being established in your name without your approval. Follow up with credit reporting companies to dispute any records you did not participate in creating.
- Ask for Gambling Debts to Be Assigned to Your Spouse – Debts accrued solely for non-marital purposes, like charges on betting apps, can be assigned solely to the spouse who incurred them. This keeps the non-gambling spouse from assuming liability for debts related to wasteful spending.
- Consider Additional Professional Support – A forensic accountant can often trace secret accounts, hidden debts, or assets that have been dissipated by your spouse’s actions. A financial advisor can help you rebuild your finances and minimize damage after you separate.
- Consider Mediation – Mediation may also be a good choice, in some cases, to prevent lengthy court battles. Discuss your options with your family lawyer to decide what is right for your situation.
Can Gambling Addiction Impact Child Custody or Support?
By default, parents in Arizona have both the right to spend time with their children and the responsibility to participate in raising and financially supporting their children. However, when circumstances like a gambling addiction interfere with a person’s ability to parent their child safely and effectively, it can impact child custody or support. The extent of gambling addiction’s impact on child support or custody depends on the severity of the addiction and the extent of the consequences.
For example, if a parent’s gambling negatively affects their parental fitness or the stability of their home or life, courts may limit the parent’s rights to parenting time and participation in making legal decisions for their children.
Indicators of reduced parental fitness and stability can include:
- Abuse or neglect
- Substance abuse
- Mental stability
- Criminal history
- Capacity for emotional support and guidance
- Effective co-parenting and communication
- Physical and emotional safety
- Meeting basic needs like food, shelter, and healthcare
In addition, if gambling affects the parent’s ability to pay child support or spousal maintenance, the court may impose additional fines or even hold the parent in contempt of court. Contempt of court charges could lead to additional penalties, including jail time. In some cases, parents who are gambling addicts may be ordered to seek treatment as a condition of custody, including legal decision-making for children and parenting time.
Why You Need an Arizona Divorce Attorney for Gambling Cases
Navigating any divorce in Arizona can be overwhelming, but when gambling is also involved, the case can become even more complex and emotionally charged. Consult an experienced Arizona divorce attorney to develop a strategy to make sure your interests are protected throughout the divorce process.
The right attorney will work diligently to achieve your desired outcome in the case, including:
- Protecting marital assets
- Preventing you from being stuck with half of your spouse’s gambling debt
- Presenting evidence of waste or financial infidelity
- Tracing hidden accounts and dissipated assets
- Arguing for an offset in asset distribution
- Calculating spousal support and child support
- Prioritizing the best interests of children
- Connecting you with resources like family counseling and treatment
- Negotiating settlements
- Arguing for adjustments and enforcement of court orders
Contact The Valley Law Group: Protect Your Financial Future in Divorce
If you are facing a divorce and financial infidelity in Arizona due to gambling, you can rely on the premier Valley-area legal team to protect your interests. The skilled divorce and family law attorneys at The Valley Law Group will develop a legal strategy to help you protect your assets, eliminate unfair debt, and secure adequate child support and child custody agreements.
Contact our office to schedule a consultation with an experienced and compassionate divorce lawyer and learn more about your legal options.
Resources:
- Arizona Department of Gaming. (n.d.). Arizona Department of Gaming. https://gaming.az.gov/
- Arizona State Legislature. (n.d.). Title 25 – Marital and Domestic Relations. https://www.azleg.gov/arsDetail/?title=25
- Arizona State Legislature. (n.d.). Arizona Revised Statutes § 25-312. https://www.azleg.gov/viewdocument/?docName=https://www.azleg.gov/ars/25/00312.htm
- BMC Psychiatry. (2023). Disordered gambling and relationship dissolution: A longitudinal population-based study. https://pmc.ncbi.nlm.nih.gov/articles/PMC10045908/
- National Endowment for Financial Education. (2021, November). 2 in 5 Americans admit to financial infidelity against their partner. https://www.nefe.org/news/2021/11/2-in-5-americans-admit-to-financial-infidelity-against-their-partner.aspx
- Superior Court of Maricopa County. (n.d.). DRDS10FZ – Divorce with Children. https://superiorcourt.maricopa.gov/media/jxdbivfd/drds10fz.pdf
Jon McCarty has broad experience in a wide variety of family law matters. After graduating from the University of Illinois College of Law with the highest honors, Jon served as Law Clerk to The Honorable David Briones in the United States District Court for the Western District of Texas. Jon then spent several years practicing in a large law firm in Chicago, before starting his own multi-state practice concentrating in family and criminal law.
