While bankruptcy is an effective form of financial relief for many people who are burdened by overwhelming debt, unfortunately, some people have tried to use bankruptcy fraudulently in that they have tried to preserve some of their assets while getting their debts discharged. Such acts are known as bankruptcy fraud, and this is a very serious crime.
Here and in an upcoming second part of this blog, we will go over five important things to know about bankruptcy fraud. Being aware of these facts can help borrowers avoid committing this crime and, instead, get their bankruptcy case resolved as favorably and efficiently as possible.
- The unintentional mistakes a person makes can just as likely lead to fraud charges and the deliberate acts he takes – In some cases, people will deliberate commit bankruptcy fraud by, for example, intentionally filing false claims, filing bankruptcy in multiple states and/or under multiple names, bribing officials (bankruptcy trustees in many cases) and/or trying to hide their assets from the bankruptcy estate (by not reporting them). In other cases, however, people may forget about certain assets, they may make unintentional mistakes in their paperwork or they may make some other error when filing for bankruptcy.
In the eyes of the law, regardless of whether the omission or mistake was intentional, the effect is the same – that the person committed bankruptcy fraud.
- Concealing assets from a bankruptcy estate accounts for about 70 percent of all bankruptcy fraud cases – The single most common form of bankruptcy fraud committed is the attempt to hide assets from the bankruptcy courts. In many cases, people will go so far as to try to transfer the asset to a friend or family member to avoid having it liquidated in the effort to pay off his creditors.
If the court finds out that a petitioner has hid certain assets from the bankruptcy proceeding, the consequences can be serious, and bankruptcy fraud charges can be brought against the accused individual.
Stay posted for the upcoming second part of this blog for three more additional important facts to know about bankruptcy fraud.
Colorado Bankruptcy Lawyers at the Law Office of Jon B. Clarke, P.C.
If you are overwhelmed by seemingly insurmountable debt and are looking for a financial fresh start, contact the trusted Colorado debt relief and bankruptcy lawyers at the Law Office of Jon B. Clarke, P.C. For more than 35 years, Mr. Clarke and his diligent support staff have been successfully helping our clients resolve even the most complex bankruptcy cases for both individuals and businesses alike. Our experienced legal professionals are committed to providing each of our Clients with the personalized debt relief assistance they need, and we will work tirelessly to ensure that our Clients’ cases are resolved as favorably and efficiently as possible.
For a thorough assessment of your situation, along with expert advice regarding the best manner in which to move forward to unburden yourself from debt, call us at (866) 916-3950 or email us some details about your situation by clicking here.