Filing for bankruptcy can get you out of debt, but only if you are truthful and honest in your bankruptcy petition and you do not do anything to harm your case before filing.
To get the benefit of bankruptcy the trade is that you must give full disclosure to the Bankruptcy Court. When you file for bankruptcy you must disclose all of your assets. The bankruptcy petition is filed under penalty of perjury, so it is critical that you provide a complete list of your assets.
You cannot hide assets in bankruptcy or give away assets in an attempt to shield them from the reach of your creditors. It is a serious crime to conceal property or transfers from the Bankruptcy Court.
Do Not Attempt to Hide Assets
Failing to list assets can cause serious problems in your bankruptcy case.
While an unintentional oversight may be corrected, a purposeful omission of an asset in an attempt to hide an asset is bankruptcy fraud. In fact, attempting to conceal or hide assets is the most common form of bankruptcy fraud. This is when a debtor attempts to hide valuable assets in an effort not to lose the asset in bankruptcy.
The U.S. Bankruptcy Code is federal law. Committing perjury (lying) in a bankruptcy case is a federal crime punishable by fines of up to $250,000 and up to 5 years in prison.
Do Not Give Away Property Before Filing for Bankruptcy
Transferring assets out of your name, possibly to a relative, in an effort to hide the asset can also amount to bankruptcy fraud. Also, not disclosing certain transfers of property or other assets prior to the filing of bankruptcy can also amount to fraud.
Preferential treatment of one creditor over another prior to filing can also cause serious problems in your bankruptcy case. Preferential treatment is payment on a debt or transfer of property made for the benefit of certain creditors over others shortly before filing for bankruptcy.
Transfers of Property
Even if you did not transfer the property with the intent to defraud the court, it can still cause problems in your case. Also, the person to whom the property or asset was transferred to could have that property seized by the bankruptcy trustee assigned to your case. This is true even when it is an asset that would have otherwise been protected through bankruptcy – that you could have rightfully kept if you had not attempted to give it away before filing.
The Department of Justice (DOJ) investigates all bankruptcy cases for fraud, abuse of the process, and other misconduct. The DOJ has extensive resources and a far reach — do not think that you can “get away with it” or that “it’s no big deal.” Bankruptcy fraud is a big deal and the penalties can be steep.
Consult A Bankruptcy Attorney
Bankruptcy is a complex area of law. It is critical that you consult an experienced bankruptcy attorney prior to filing for bankruptcy or attempting to transfer, sell, give away, or otherwise attempt to shield assets. There are legal and proper ways available to protect your assets through bankruptcy.
If you have questions about what is protected in bankruptcy, call us today (912) 351-9000 to schedule your free consultation. The Law Office of Barbara B. Braziel proudly serves all of Savannah, GA and the surrounding counties including Chatham County, Effingham County, Bulloch County, Bryan County, Liberty County, Long County.
We are a debt relief agency. We help people file for bankruptcy relief under the U.S. Bankruptcy Code.