When you file Bankruptcy, your lawyer is your best friend. He or she can guide you through the process with a minimum of disruption to your life; save any of your assets that can legally be kept; and make the process as easy and non-confrontational as possible.
But when you don’t tell him everything, he can’t help you. It’s as simple as that.
Recently, a client didn’t tell me about a car she had given to her son about 9 months ago. Probably she just forgot to mention it. After all, the car wasn’t worth more than about $2500. No big deal; right? Wrong.
When the trustee discovered that she had transferred the car to a family member (insider) within the past year, he was able to set aside the transfer and get the car. He will sell it and use the funds to pay the unsecured creditors in the estate.
But that’s not the worst thing that happened. Now, the trustee has identified this case as a problem one, with, possibly, a dishonest debtor. So he is checking and double-checking everything in the bankruptcy paperwork.
What was once a simple, no-asset, bankruptcy, has become a headache for the client and for me. Had I known about the transfer, full disclosure would have been made and this case would have been resolved without any frustration or annoyance.
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