How Will the Bankruptcy Judge Know If I Don’t Tell the Truth?
By Jill Michaux, Kansas Bankruptcy Attorney on Sep 21, 2007 in Bankruptcy Practice and Procedure, Benefits of Bankruptcy, Debts Not Dischargeable, General Bankruptcy Information, Life After Bankruptcy
Brett Weiss recently wrote about the importance of telling the whole truth in bankruptcy proceedings in his post, Do I Really Need to Tell the Judge . . . ?
I am sometimes asked, “how will they know” if I don’t tell the truth or leave off a creditor, omit income or hide property?
How will you get caught if you don’t tell the truth? Disgruntled ex-spouses accuse you of hiding assets, improper transfers or other dishonest acts. Neighbors, co-workers and “friends” who think it is unfair or “not right” that you are getting out of debt, but keeping the [fill in the blank], make it their business to tell on you, often anonymously. A trustee’s clerk sees you at the mall spending money or eating out at a restaurant and wonders how you can afford it? Or, you are sighted at the casino and word gets back.
Unhappy creditors have information about you that is shared with trustees and used against you. Trustees have investigatory powers and will leave no stone unturned to find assets to turn into money for your creditors.It is a small world out there. There are many ways for you to get caught lying or cheating in bankruptcy. Dishonesty results in denial of your bankruptcy discharge, losing property and criminal prosecution.
As a general rule, more disclosure is the rule in bankruptcy. If you are uncertain what must be disclosed, have a frank discussion with your bankruptcy attorney BEFORE your case is filed. Many times there are honest, legitimate ways to accomplish your goals. The temptation to do something dishonest is often based upon misunderstanding. If you are unwilling to tell the whole truth, do yourself a favor and don’t file for bankruptcy relief.
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