Fraud: Bankruptcy Fraud
Federal Criminal Attorneys in Miami Florida
Bankruptcy is a legal process whereby individuals or businesses can be absolved of all of their debts if they become unable to meet there financial obligations. There are several different types of fraud that violate the bankruptcy code. Bankruptcy fraud is an offense charged under federal statutes and is always prosecuted in federal court. A person convicted of bankruptcy fraud can be sentenced up to five years and prison and receive a $250,000 fine. The Miami criminal defense attorneys at DMT have experience in defending all three causes of action.
The most common type of bankruptcy fraud is the concealment of assets. This type of bankruptcy fraud occurs when a debtor hides assets during the declaration stage of the process. The debtor will attempt to hide the assets so they will not be liquidated and turned over to the lenders that have a claim. Debtors can fail to list the items, transfer the assets to friends or family members or hide assets in offshore accounts to avoid the liquidation of certain assets.
A second type of bankruptcy fraud is referred to as "multiple filings". This offense occurs if a debtor files for bankruptcy in more than one jurisdiction. The debtor will submit an incomplete list of assets in both jurisdictions to avoid liquidation of assets. In some instances, debtors will file for bankruptcy used s false or assumed named to protect assets.
The third type of bankruptcy fraud is referred to as the "petition mill". In these cases, the debtor does not commit the fraud. The fraud is committed by a third party who offers to assist a tenant from being evicted. After being paid by the tenant to fight the eviction, the third party files for bankruptcy after keeping fees paid for the purpose of fighting the eviction. In the end, the tenant's credit score is ruined and their cash depleted.
Chapter 7 of the bankruptcy code is most beneficial to debtors as all debts are forgiven, The chapter only applies to individuals that make less than $183.50 of disposable income per month. Debtors who earn more than that are required to file under Chapter 13 of the bankruptcy code. Under chapter 13, only a portion of the debts are forgiven and debtors are required to make monthly payments for three to five years. Debtors committing this type of fraud attempt to falsely increase their monthly expenses to reduce the amount they have to declare as disposable income.
The lengthy downturn in the economy has caused bankruptcy fraud to become more commonly charged in federal court than in years past. Bankruptcy fraud is considered a white collar crime and is always charged in federal court. There are four types of bankruptcy charges that are typical found in federal indictments. The first type of fraud consists of debtors hiding certain assets to prevent their forfeiture in federal court. The second type of bankruptcy fraud occurs when an individual files false or complete forms that are necessary to complete the bankruptcy process. The third type of fraud occurs when an individual files multiple bankruptcy claims in several states. The fourth kind of bankruptcy charge is least common and occurs when an individual bribes a court appointed trustee.
In the majority of bankruptcy fraud cases, the indictment also includes charges for identity theft, mortgage fraud, money laundering and public corruption. A conviction for bankruptcy fraud could result in a five year prison sentence and significant fines. The Miami criminal attorneys at DMT have years of experience in federal court defending various accusations of fraud. If you, or anyone your know is being investigated for or has been indicted for bankruptcy fraud or any other white collar crime, contact our Miami criminal law firm for guidance and representation.
Approximately 70% of all bankruptcy fraud charged indicted in federal court involve the non-disclosure or concealment of assets. The bankruptcy laws requires that all assets be disclosed so that creditors can be repaid from the sale of those assets. Debtors that fail to reveal assets in order to conceal them from creditors may be committing a federal offense. The same holds true for debtors that transfer certain assets to friends, relatives or associates in order to avoid the creditors attachment and eventual liquidation. Another popular type of bankruptcy fraud filed in federal court involves multiple filings in different bankruptcy courts in different jurisdictions. Multiple filings inhibit the bankruptcy process and significantly reduced the time it takes to close a bankruptcy case, especially the liquidation of assets.
To speak with an experienced criminal Miami federal white collar crime attorney at DMT about your bankruptcy fraud or any type of federal case, or if you have questions regarding a matter involving any federal crime, please contact DMT to schedule a free consultation. You can call our office at (305) 340-2197 or reach us by completing the form on our contact page
or by sending an e-mail. We are available 24 hours a day, 365 days a year to discuss your case.