All about Bankruptcy Fraud

If you’re in Maryland, there are many reasons to approach a Baltimore bankruptcy lawyer and not only because you’re the one who needs to file a bankruptcy case. Sometimes, it might also be because you need the opinion and support of an expert to counter a filed bankruptcy case by a person whom you suspect or have proof to be committing bankruptcy fraud.

petition to file for bankruptcy

 

But what exactly is bankruptcy fraud?

Well as the term suggests, bankruptcy fraud is an act committed when an individual or party filing for a bankruptcy case actively conceals or neglects to reveal all assets that they may still have. If one succeeds in a bankruptcy case, they will be “given a fresh start” and this stops their creditors (the entities they owe money or other credits to) from forcing them to pay the discharged debts.  Failing to reveal any still-existing asset is considered an offense — an act of perjury, or the falsification of statements in court after having taken an oath.

The extent of penalties for bankruptcy fraud can affect the involved party for the rest of their life. So if you’re in Maryland, the expert perspective of a Baltimore bankruptcy attorney should always be considered.

What are the usual forms of bankruptcy fraud?

  1. False statements
    • Some commit bankruptcy fraud, whether intentionally or not, when they falsify information during their case. This can come in the form of withholding, destroying, or faking documents and the information found on them; this can also take place whenever the involved party fails to tell the truth and the complete truth when tasked to do so under oath.
  2. Pre-bankruptcy Fraud
    • One can commit fraud by taking necessary preparations before the bankruptcy takes place, whether or not they intend this to be connected to bankruptcy filing. An example would be when a person starts a business or purchases certain items using credits with the intention of filing for bankruptcy. Another would be when one purchases luxury items using credit or takes out substantial cash advances shortly before filing their bankruptcy case, and with no intention of paying.
  3. Bribery
    • Fraud can take place if you bribe your court-appointed trustee. This is considered to be one of the more detestable forms of fraud since it’s obviously and directly intentional that the filer intends to commit perjury. This act is committed when the filer offers money to their trustee if the case is approved, or sometimes even to their debtors to lower the figure of the debt in exchange for immediate money.
  4. Creditor’s Fraud
    • The filer for bankruptcy isn’t the only party that can commit bankruptcy fraud; sometimes, the creditors can commit the crime as well. This happens if they declare a wrong/inaccurate figure that the filer owes them with the intention of charging more later on.
  5. Multiple Filing
    • Bankruptcy fraud can also be committed if a party files multiple bankruptcy cases in two or more states with the same name and information, or false ones, or a combination of both. And then the debtor/filer intentionally lists the same assets on each claim but also intentionally doesn’t declare ALL assets, which would confuse the system and slow down the case’s process. A party would commit this form of bankruptcy if their intention is to protect their remaining assets from total liquidation and earn time so they can hide those assets.

Without being in this situation yourself, you might already imagine how disastrous a bankruptcy filing can be if you’re not careful enough. After all, bankruptcy fraud isn’t always a conscious act; sometimes it can be an unfortunate mistake if you don’t take care to double-check all your assets. So if you’re ever in need of filing for bankruptcy, make sure to consult Richard Hackerman: the most reliable bankruptcy lawyer in Baltimore, Maryland. With our assistance, you can rest assured that this difficult stage in your finances will go smoothly until your case is approved. We can make sure that you don’t fall into committing bankruptcy fraud or that your creditors won’t harass you in such a way, whether intentionally or not. So contact us now and let us work together for your true fresh start in finance.

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