Earlier this year in Manhattan, New York, an ex-Wall Street trader who was in the middle of a bankruptcy proceeding was denied the ability to discharge his debts after the presiding bankruptcy judge found out that the man was hiding several million dollars worth of assets.
According to one local news report, the ex-trader was involved in the embezzlement of $43 million several years ago and was actually sentenced to prison. After he got out, he reinvented himself, starting a company that loaned money to professional athletes.
The ex-trader had filed for Chapter 7 bankruptcy protection back in 2013, after he was ordered to pay federal income tax on a portion of the $43 million he embezzled. However, throughout the proceeding, the man lied under oath several times to the court.
The man’s indiscretions with the court came to light, prompting the federal judge overseeing his bankruptcy to comment that the man “displayed a cavalier disregard for his disclosure obligations in [his] bankruptcy case,” including making “so many false oaths that they are difficult to count.”
In the end, the federal judge denied the man the opportunity to discharge his several million dollars in debt.
The Importance of Candor to the Court
The situation above is an extreme example of a fairly common occurrence. It is not uncommon for a person filing for bankruptcy to try and conceal assets. However, if and when the court discovers that this is occurring, the consequences can be drastic.
Rather than attempting to intentionally deceive the court, a person filing for bankruptcy is best served by complying with all the laws with the assistance of an experienced bankruptcy law attorney. A dedicated bankruptcy attorney who knows the ins-and-outs of federal bankruptcy law is an invaluable asset to anyone filing for bankruptcy, since a lawyer will be able to help the filer comply with the law and also take advantage of any legal opportunities.
Throughout the bankruptcy process, there are myriad opportunities to make a misstep. However, to counter those potential errors, there are also an equal number of opportunities to benefit from legal but outside-the-box thinking that may save a filer both time and money in the future. To learn more about bankruptcy law, contact a dedicated bankruptcy law attorney.
Are You in Need of Legal Representation?
If you are in the middle of the bankruptcy process, or if you are considering filing for Chapter 7 bankruptcy, you should consult with a dedicated bankruptcy law attorney as soon as possible. Depending on your specific situation, there may be much to gain by having an experienced attorney by your side throughout the process. The skilled attorneys at the Schwartz Bankruptcy Law Center have years of experience handling all kinds of bankruptcy matters for hundreds of clients. To set up a free consultation with an attorney, call 866-366-3328.
More Blog Posts:
Bankruptcy Judge Allows Debtor To Recover Attorney’s Fees After Creditor Violated Automatic Stay, Kentucky Bankruptcy Lawyers Blog, published October 6, 2014.
Bankruptcy Court Allows Malpractice Plaintiff to Sue Surgeon in Bankruptcy, Kentucky Bankruptcy Lawyers Blog, published November 2, 2014.