Bankruptcy fraud is when an individual fraudulently files for bankruptcy so that they can avoid their legal responsibilities to their creditors. A person charged with federal bankruptcy fraud is potentially facing imprisonment and/or expensive fines. Therefore, it may be a worth it to you to understand what constitutes Maryland federal bankruptcy fraud. To learn more about what federal bankruptcy fraud is and how charges could impact you and your freedom, contact an accomplished federal bankruptcy fraud lawyer.
Fraudulent Concealment of Assets
One of the most common acts of bankruptcy fraud involves the concealment of assets. There are few different ways in which fraudulent concealment of assets can occur. The main one is concealing assets through a bankruptcy petition. This is because, in bankruptcy, a person begins with a list of all of their assets, including property, cash, bank accounts, and everything they own. All this goes into an estate that is managed by the court during the bankruptcy process, and it is from that estate that the creditors will seek to obtain satisfaction for their debt. There are exceptions, such as personal items of little monetary value but with significant sentimental value. Sometimes equity in the house or other property can be exempted. Also, there may be specific estate exemptions.
Generally, all assets need to be included in the estate. If a person fails to put something in the petition, lies or misrepresents about their ownership or interest in some asset or attempts to hide their ownership or interest in their assets, it is a crime.
Concealing Property
An example of concealing property is when a person owns half of a company with a family member. This can be a significant asset that must be disclosed even if they do not own it outright under their name. In the books, it may just say that the person is a partner and not include the fact that the individual is actually a part owner. If the petitioner fails to include ownership in the company, then they would be concealing the property. An individual concealing property would be an example of what constitutes Maryland federal bankruptcy fraud.
False Oath or Account
Once an individual petitions for bankruptcy, they have to state under oath that the information that they are presenting to the court is accurate. In addition to making the representations of their financial situation, they have to formally certify it under oath. If it turns out that the person was not truthful, then it is considered a false oath or account in the bankruptcy proceedings.
False Declaration Under Penalty of Perjury
False declaration under penalty of perjury occurs when a petitioner makes false statements under oath to confirm or verify either information they petition or the specific information that may be the subject of a hearing. False declaration under penalty of perjury can also be in a document and involve the petitioner, lawyer, notary, or anyone else in the process. There are criminal sanctions for the petitioner if anything is untrue. If any of the statements are alleged to be knowingly false, then it would constitute as making a false declaration under penalty of perjury.
False Claims of Proof Against the Estate of the Debtor
Another example of what constitutes Maryland federal bankruptcy fraud is the false claims of proof against the estate of the debtor, which is a crime that could be against a creditor or potential creditor who is attempting to make a claim. As part of the process, the creditor needs to prove that they actually are a legitimate creditor and have a legitimate claim against the debtor. If creditor presents a false claim, such as a counterfeit or fabricated document, and represents themselves as being a creditor when they do not have an interest in the property, then it is considered a false claim of proof against the debtor. They are misrepresenting that they have an interest in the debtor’s property when they really do not.
Receiving Property from Debtor
Receiving property from a debtor is a form of bribery. The debtor circumvents the process and may try to go outside of the bankruptcy court to negotiate, bribe, influence, or induce the creditor to drop the claim or claim satisfaction on a claim without going through the entire process. Part of the bankruptcy process involves prioritizing different creditors and determining which creditor will get which amount and what pieces of property the creditor would receive.
There may be a situation where to minimize their exposure for personal reasons, the debtor will try to induce the creditor to drop their claim. This would be a form of bribery or a form of conveyed property to creditor outside of the bankruptcy proceeding. To learn more about what constitutes Maryland federal bankruptcy fraud, contact a lawyer today.
