Although some people may purposely attempt to commit fraud during bankruptcy proceedings, many more do so without even knowing it, as even minor accounting errors can result in bankruptcy fraud charges. Being charged with bankruptcy fraud can have devastating financial and personal consequences for the accused, so if you are being investigated for fraudulent activity in connection with your bankruptcy proceedings, it is critical to speak with an experienced white collar crime attorney who can help you formulate a strong defense.
What is Bankruptcy Fraud?
Bankruptcy fraud is a white collar crime that usually involves the concealment of assets from the government. However, there are actually a number of different ways that a person can commit bankruptcy fraud, although most bankruptcy fraud cases fall under one of the following categories:
- Concealing assets to avoid forfeiture;
- Intentionally filing a false or incomplete bankruptcy-related form;
- Filing for bankruptcy on multiple occasions using either legitimate or false information in multiple jurisdictions; or
- Bribing a court-appointed trustee in connection with a bankruptcy proceeding.
Charges of bankruptcy fraud are especially serious because they are almost always accompanied by additional charges, such as identity theft, money laundering, public corruption, and mortgage fraud.
Common Forms of Fraud
Although bankruptcy fraud can take a number of different forms, most cases involve the concealment of assets in an effort to avoid liquidation by creditors. Failing to reveal the existence of assets qualifies as concealment, as does transferring undisclosed assets to associates, friends, relatives, or business partners with the intention of hiding them. Another common form of bankruptcy fraud involves multiple filings, which occurs when a debtor files for bankruptcy in more than one jurisdiction and:
- Uses the same name and information;
- Uses aliases and false information; or
- Uses a combination of real and false information.
Regardless of the form it takes, accusations of bankruptcy fraud can have devastating consequences for defendants who could be charged under federal law, which requires evidence that a defendant knowingly misrepresented a material fact with the intent of defrauding a creditor or the government. In fact, a person can be charged under federal bankruptcy law not only for filing a false petition, but also for filing any fraudulent document or making a false representation, claim, or promise in connection with a bankruptcy proceeding. This is true regardless of whether the statement was made before or after the filing of the petition. However, before a person can be convicted, prosecutors must be able to demonstrate that the defendant knowingly misrepresented a material fact with the intent of defrauding a third party. Even attempting or intending to commit bankruptcy fraud is punishable under federal law by up to five years in prison and a $250,000 fine.
Schedule a One-on-One Meeting with a Dedicated Miami White Collar Crime Attorney Today
If you are currently being investigated for or have been charged with bankruptcy fraud, please call experienced Miami white collar crime lawyer Jeffrey S. Weiner, P.A. at 305-670-9919 for a free case evaluation.