Defense Considerations

The concealing of assets makes up about 70% of all bankruptcy fraud charges. Concealing assets from a bankruptcy court may be perceived as fraud. For example, an individual in Chapter 7 bankruptcy lists her/her assets as being below his/her liabilities.

While this is the typical situation in most bankruptcy filings, the eventual outcome is not. After the debtor's bankruptcy is dismissed, the bankrupt person seems to continue living an extravagant lifestyle. Debtors may be reported by their neighbors or business associates. Concealed assets may include boats, country club memberships, watches, cars and homes. An investigation would then take place to determine whether these assets were possessed at the time of the bankruptcy filing and not listed in the asset schedule in hopes of avoiding liquidation.

In the case of a business bankruptcy filing, concealment of assets typically occurs on a larger scale. It is important to understand that the bankruptcy fraud can be charged even in cases when the assets were not owned at the time of the bankruptcy.

For example, a business owner places his company in a Chapter 11 bankruptcy because the company is facing a severe cash shortage. Just prior to filing for bankruptcy, the owner transfers large sums of cash and other company assets to family members and outside business interests which the business owner controls. The debtor's objective is to protect those assets from sale or liquidation.

The concealment of assets is the most significant aspect of law enforcement and investigation. However, asset concealment is not the only scheme that may be suspected in cases of bankruptcy fraud. Other related criminal acts may include:

• Petition mills
• Multiple bankruptcy fraud filings in different states
• Making false statements
• Embezzlement
• Credit card fraud
• Identity fraud

The variety of schemes that can be used to avoid loss of assets leads many people to not even understand that they are committing a crime. It can also lead to additional criminal charges.

Bankruptcy fraud charges can be made in both criminal and civil court. It is critical that the defense team used has specific experience defending these charges and also in working within the civil court system. Our objective is not only defend you against the primary charges but also to prevent additional related charges from being filed and successfully prosecuted.

There are good remedies for a criminal charge of bankruptcy fraud. Call United Defense Group at (800) 459-2500 to discuss your particular case. The earlier you get defense counsel involved, the better your chance for a successful outcome. If you even suspect that you may be under investigation for bankruptcy fraud, obtaining defense early can often result in charges not being filed.