The Dangers of False Bankruptcy

When preparing for a case with a bankruptcy court, it is important that all of your financial details are listed honestly and accurately, and that a competent legal professional is available to provide education and information as needed. Filing for bankruptcy when it is not necessary is a crime that carries penalties.

The most common type of false bankruptcy claim involves the concealment of assets. For instance, debtors may transfer funds or property to others to protect it. Other tactics for fraudulently claiming bankruptcy include filing false or incomplete paperwork, filing several times in multiple states, and even bribing trustees.

For debtors to be charged with this crime, there must be evidence that the accused knowingly misrepresents their claims. The consequences for doing so are severe, including a sentence of up to 5 years in prison and a fine of up to $250,000.

In one case, for example, a real estate broker falsely reported his income and was ultimately sentenced to 15 months imprisonment. In another case, a woman was sentenced to 14 months in prison for fraudulent activity in two separate cases. One involved lying under oath in her friend’s bankruptcy case, and the other for exaggerating her income when applying for a loan.

Qualified and experienced bankruptcy attorneys are familiar with the intricacies of the law, its requirements and processes, as well as potential consequences for violating them. Because the stress that results from struggles with looming debt can be overwhelming, it is helpful to hire a knowledgeable lawyer to assist throughout the ordeal.

A legal expert can ensure a sound case, that details are accurately reported, appropriate paperwork is filed in a timely manner, and questions posed by both the client and the court are answered thoroughly. For this type of exemplary assistance, contact Brock & Stout  today.