Bankruptcy fraud is a federal crime that carries harsh penalties. It is important that you be truthful, thorough, and accurate in your bankruptcy petition. You want to avoid committing fraud or even being suspected of committing fraud. The punishment for bankruptcy fraud may include fines of up to $250,000 and/or up to 5-years in prison.
What is Bankruptcy Fraud?
Bankruptcy fraud can occur in a number of ways but always involves an intent to deceive the Bankruptcy Court. The most common form of bankruptcy fraud is when a debtor attempts to conceal assets to prevent them from being seized. There are a number of ways a debtor may try to conceal assets. For example, a debtor may transfer or “give away” certain property, assets, or even cash to relatives or friends in an effort not to lose the asset in bankruptcy. Or, a debtor may purposefully not list certain assets in his or her bankruptcy petition. Either of these actions can amount to bankruptcy fraud.
If you file for bankruptcy, you have a duty to disclose all of your assets in your bankruptcy petition. This mandate includes recent transfers of property, whether given to relatives or sold to third parties.
Bankruptcy fraud can also occur when a debtor files false or incomplete forms or files multiple bankruptcy cases across numerous jurisdictions or using fake information. Purposely filing false information in a bankruptcy petition is bankruptcy fraud. Further, purposely omitting information with the intent to defraud is bankruptcy fraud.
Multiple filing fraud is when a debtor files for bankruptcy in multiple jurisdictions, either using the same name and information or using a fake name or other false information. This type of bankruptcy fraud is likely committed to take advantage of the different exemption schemes offered in different states, in an effort to keep more assets than are legitimately protected in bankruptcy.
Attempting to bribe a Bankruptcy Trustee or other officer of the court may also amount to bankruptcy fraud.
The Penalty of Perjury
Bankruptcy petitions are filed under the penalty of perjury. Debtors are sworn in under oath at the bankruptcy 341 Hearing, so the testimony is given under the penalty of perjury. It is critical that you be truthful and honest in your petition and your testimony.
Together we will work through the bankruptcy petition. Prior to filing, you will review your entire bankruptcy petition to ensure that is it complete and accurate. We will prepare you for the bankruptcy 341 Hearing so you feel confident in answering the Trustee’s questions honestly and accurately. The experienced attorneys at The Law Office of Barbara B. Braziel are committed to making the bankruptcy process as smooth as possible for all of our clients.
We’re located in the Savannah, GA area. Contact us for a free consultation to discuss the benefits of filing for bankruptcy.
Reach out to us by email at info@BrazielLaw.com or call (912) 351-9000.
We are a debt relief agency. We help people file for bankruptcy relief under the U.S. Bankruptcy Code. Find out more about Bankruptcy in our guide: All About Bankruptcy.