Why Hiding Assets During Bankruptcy Is A Horrible Idea
Bankruptcy is serious business, and it’s a time when you should put all of your financial cards on the table. We know it can be tempting to keep a few of your assets – properties, recreational vehicles, inheritance, secret savings account, etc. – but the chances are better than average that you will get caught. When you do, you could be facing criminal penalties. When filing for bankruptcy, you’ll be allowed to keep enough property so that you can continue working and still maintain your home.
DON’T TRY TO BE CUTE
A common tactic used by some people to scheme the bankruptcy trustees is to transfer assets or properties – such as a car title – to another person’s name. Bad move. This action is viewed as bankruptcy fraud. Even if you’re stuffing cash between your mattresses, it’ll be found.
HOW WILL THEY FIND OUT?
Most bankruptcy trustees are experts at identifying red flags in bankruptcy petitions or at creditors’ meetings where you’ll be questioned about your assets, debts and other financial obligations. Any hint of deception will most likely trigger further action by the trustee, including:
- Thoroughly inspecting your home and other properties
- Going through all of your financial documents – paycheck stubs, banking records, etc. – while looking for deposits into accounts that may have been withheld
- Examining all records at your place of work if you operate your own business.
WHAT’S THE WORSE THAT CAN HAPPEN
Trust us, you don’t want to push your luck in trying to hide assets while filing for bankruptcy. If caught, possible unsavory outcomes include:
- Criminal charges for making the false statement that you bankruptcy petition was true and accurate – this carries a fine of up to $500,000 and up to five (5) years in prison
- Having your bankruptcy petition denied, meaning that you’ll still be on the hook for paying back all debts that would have been wiped out by the bankruptcy
- Taking the hidden asset from you, selling it and dividing the proceeds among your creditors
CONSIDER FILING CHAPTER 13 BANKRUPTCY
Chapter 13 bankruptcy may be a good option or you if you cannot live without all of your property. In essence, Chapter 13 bankruptcy allows you to keep your nonexempt assets while you pay off a percentage of your debt via a repayment plan.
STATEWIDE BANKRUPTCY CAN HELP YOU
If you’re facing bankruptcy, you definitely need the expertise of a skilled attorney who knows all the ins and outs of the process so that nothing is left to chance. We welcome the opportunity to speak with you, so please contact the offices of Statewide Bankruptcy today by calling (602) 225-2222.