Avoiding Bankruptcy Fraud

In the United States, we are afforded legal protection when we file bankruptcy. The law allows us to eliminate our debt and relieve our financial burden. We can file Chapter 7 liquidation bankruptcy or Chapter 13 reorganization bankruptcy as an individual or with a spouse. Where problems can come from is if you either intentionally or inadvertently misrepresent your situation with the bankruptcy courts. Your case could be dismissed, and you may find yourself being charged with fraud.

Fraud

Most people seeking debt relief cannot accidentally commit bankruptcy fraud. If you intentionally failed to list the debt you owe or your income, this will probably result in your case being dismissed. The most common factor in all bankruptcy fraud cases is that filers attempted to get around the jurisdiction of the bankruptcy courts to get a financial advantage.

Never Hide Assets

When filing bankruptcy, never attempt to hide money or assets. The courts will find out. The most common fraudulent action is when money or property is given to family or friends to protect those assets from Chapter 7 seizure for the courts to sell. The federal bankruptcy courts will initiate criminal proceedings against you if they find out. The court will not consider fraud if you sold assets to buy necessities. Be sure you have documentation to justify any sales. 

Getting the help of an experienced McAllen bankruptcy attorney can help you legally keep most or all of your assets and get the most financial relief.