Don't Let Simple Mistakes Dismiss Your Personal Bankruptcy Case
Bankruptcy's fresh financial start can be a welcome relief for those overwhelmed by credit card debt, medical debt or mortgage debt. But that same financial clean slate can be abused by those looking to cast off creditors without sacrifice.
Bankruptcy fraud is a federal offense punishable by up to $250,000 and five years in prison. While the occurrence of fraud is rare, the punishment is severe enough that debtors looking to file bankruptcy should know what bankruptcy fraud is, and how to avoid it.
If you are concerned about the consequences of bankruptcy fraud, you can discuss your case with a local bankruptcy attorney. Simply fill out our free evaluation form or call 877-833-2410 to speak with a bankruptcy lawyer in your area today.
What is Bankruptcy Fraud?
Bankruptcy fraud can take four general forms:
- Concealing or transferring assets
- Intentionally filing false or incomplete forms
- Filing multiple times using false information or in several districts
- Bribing a bankruptcy trustee
According to the FBI, which investigates bankruptcy fraud, concealment of assets is the cause of nearly 70% of all bankruptcy fraud cases.
Bankruptcy fraud is often committed alongside another crime, such as identity theft, mortgage fraud, or money laundering.
Concealing Assets in Bankruptcy
In Chapter 7 bankruptcy cases, the bankruptcy trustee liquidates the debtor's assets to repay creditors. However, some debtors try to conceal their assets by leaving them off the bankruptcy petition, giving them to friends or relatives, or selling them under value.
If this type of fraud occurs, the bankruptcy trustee may still be able to force the debtor to include the assets in the bankruptcy estate, and may sue to do so.
In addition, if a debtor is found to have committed bankruptcy fraud, their case may be thrown out by the bankruptcy court. Even if the case has been completed and debts discharged, the discharge could still be revoked, leaving the debtor with all the original debts.
Discuss Filing Bankruptcy with a Local Attorney
Filing personal bankruptcy is a legal process, and can be overwhelming or confusing for first-time filers. Let a bankruptcy lawyer guide you through the process. By working with an attorney in your area, you can address common errors should they arise.
Connect with an attorney in your area today. Simply fill out the free form on this page or call 877-833-2410 to take the next step in the bankruptcy filing process.