Though many government and financial experts have announced that the U.S. economy has almost totally recovered from the recession, nearly half of Americans think the country remains deep in recession, according to a Wall Street Journal poll. Perhaps this is why the rate of bankruptcy filings within the United States has held fairly steady over the last several years. Bankruptcy is considered a last resort for many people and businesses as it offers the elimination of some or all of their debts if the person or organization is willing to subject their assets to liquidation to pay off as much of their debt as possible. Additionally, those who successfully file for bankruptcy will suffer severely damaged credit ratings and other financial fallout for several years afterward. Nonetheless, the lure of eliminating substantial debts can and does lead to mistakes and misuse of bankruptcy laws. Due to the amount of money involved, federal authorities closely scrutinize bankruptcy filings for any red flags or signs of wrongdoing. Given the arduous and draining process that bankruptcy filing presents, and the potential for error that can be construed by authorities as intentional deception, anyone considering a bankruptcy filing should speak with a DC bankruptcy fraud lawyer to ensure that they follow all procedures and do not run afoul of the law.
The ways in which you can find yourself in trouble regarding bankruptcy filings are numerous. In the case of a liquidation bankruptcy, such as Chapter 7 bankruptcy, an individual may not realize that they must disclose all of his or her assets. When confronted with disclosing items and property that have been in their family for years, or that has sentimental as well as monetary value, they may withhold crucial information. A person can easily yet erroneously conceal certain assets or withhold information that affects their bankruptcy filing and their ability to discharge debt. Such a decision, however, could be construed as a criminal act that can be prosecuted in federal court and punishable by many years in prison.
This is why it is in one’s best interest to have the representation of an experienced attorney when dealing with any type of bankruptcy proceedings. If, however, you have already been accused of bankruptcy fraud, a federal DC bankruptcy fraud lawyer can still work with you to craft the best-possible defense.
There are a number of things that federal authorities look for as signs of attempting to conceal, withhold, or falsify information during a bankruptcy. These include, but are not limited to:
By far the most common type of bankruptcy fraud involves the concealing of assets. If a lender does not know about hidden property or assets, the institution cannot liquidate or repossess those assets in order to pay the debt. Therefore, any suspicion that assets have been concealed will trigger a stringent review of the filing by authorities for possible fraud charges.
Bankruptcy is defined by federal law in Title 11 of the U.S. Code. Chapter 7 focuses on the liquidation of assets to payoff debts. Chapters 11 and 13 pertain to the reorganization of a business’ (Chapter 11) or a person’s assets (Chapter 13).
Bankruptcy is intended to provide some relief from crushing debt, but it is not designed to be punitive to the lender nor does it allow for the debtor to escape their debts without addressing at least some of his or her financial responsibilities. Because of this, the laws are carefully drafted and clear in outlining the rights, responsibilities, and rules of bankruptcy. Falsifying information, making false statements, and concealing or withholding assets are all aspects of bankruptcy fraud, which is a federal crime.
Title 18 of U.S. Code Section 152 sets the penalties for those who are convicted of concealing, or hiding, one’s assets, bribery, or making false claims. All of these acts are deemed felony offenses that may result in a maximum penalty of five years in prison, per offense. Those convicted also face up to $250,000 in fines. Section 157 further delves into the issue of bankruptcy fraud regarding false promises and/or claims and fraudulent representations. Similar penalties for those convicted may apply.
The nation’s capital is not immune to economic difficulty and financial strife. When an individual, small business, or corporation is on the brink of collapse under overwhelming debt, bankruptcy can provide a way to get back on track. However, misrepresenting oneself and one’s assets will not make the financial situation better; rather, it will only complicate matters by adding considerable legal difficulties to one’s financial woes.
Quickly finding qualified legal defense representation is critical for those accused of committing federal bankruptcy fraud. A DC bankruptcy fraud lawyer can provide legal counsel and a vigorous defense against federal criminal charges. Whether you are charged with fraud as the result of an honest mistake or following a desperate attempt to salvage your assets, you have many legal options to explore. Call today to schedule a no-cost consultation.
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