Bankruptcy fraud can come in many forms, such as concealing assets from the bankruptcy court or fraudulently transferring assets prior to filing. Fraud can also occur when a person’s motives for filing for bankruptcy protection are fraudulent, or when filers abuse the system by filing more often than is permitted by law.
If you are facing allegations of bankruptcy fraud, a seasoned white-collar crimes attorney with experience battling against prosecutors in federal court can aid in your defense. A Lincoln bankruptcy fraud lawyer at Berry Law can look at the details of your case and work to obtain a favorable outcome on your behalf.
Types of Bankruptcy Fraud
There are countless ways that a debtor could inadvertently make a mistake when filing for bankruptcy. A skilled attorney at our firm can help you understand what does and does not constitute bankruptcy fraud under state law.
One of the most prevalent types of bankruptcy fraud in our area involves the concealment of assets. When filing for bankruptcy protection, debtors are required by law to list all of their assets in their petition. In many cases, the bankruptcy trustee could liquidate these assets in an effort to satisfy debts. Any attempt to hide assets from the bankruptcy court to prevent their liquidation could result in charges of bankruptcy fraud.
The use of false or misleading material statements could also lead to bankruptcy fraud charges, regardless of whether the debtor is attempting to conceal assets. Any failure to provide truthful information could result in criminal prosecution.
Furthermore, debtors are limited under federal law in the number of times they can file for bankruptcy during a certain period of time. However, some debtors file more frequently than the law allows. Because the automatic stay of the bankruptcy code goes into effect immediately upon filing, these individuals gain the protections of the bankruptcy stay despite not being eligible for discharge.
The bankruptcy trustees are typically at the forefront of investigating allegations of bankruptcy fraud. This is true for debtors filing for protection under Chapter 7 and 13 of the bankruptcy code. If, during the course of their duties, the bankruptcy trustee suspects fraud, they have the right to initiate an investigation.
This investigatory power allows them to request a range of documentation from the debtor. If the trustee finds evidence of fraud, they can initiate what is known as an adversary proceeding. During this proceeding, the trustee can compel documents, seek permission from the court to block a discharge, and recover concealed assets.
Following these adversary proceedings, it is not uncommon for federal law enforcement to open their own investigations into the alleged fraudulent activity. This means a person could face criminal charges in addition to the consequences of their bankruptcy case. A Lincoln attorney can advise you on whether fraud charges are imminent.
Contact a Lincoln Bankruptcy Fraud Attorney Right Away
The potential consequences of a bankruptcy fraud conviction go beyond the inability to discharge the debt or the liquidation of assets in bankruptcy court. They also include the potential for jail time and fines.
If you are facing allegations of bankruptcy fraud, it is imperative that you retain legal representation right away. Schedule a confidential consultation with a Lincoln bankruptcy fraud lawyer at Berry Law to learn more.