Honesty is the bedrock your bankruptcy case is built upon. At nearly every step of the way you will be asked to attest or to swear to writings or to oral statements. On the third page of the bankruptcy petition you will sign a statement that the information in the petition is true and accurate. This same language will be duplicated in the declaration of signature that you will sign as well. This declaration will be filed with the court containing both our signatures.
Honesty when you file a bankruptcy case includes telling the truth to:
- Your attorney
- Your bankruptcy trustee
Tell your bankruptcy lawyer the truth
If you lie to you attorney, that will make the entire process dishonest. The lawyer can only fill out the bankruptcy petition with the information you provide. This can happen in two ways: giving false information, or not telling him something you know to be true to keep the trustee from taking action against some asset.
Tell your trustee the truth
I recently saw this in action while waiting for a meeting of creditors with a client. The trustee was examining an unrepresented debtor under oath. This person did not disclose any bank accounts on his bankruptcy petition. The trustee asked what she did with her 2010 tax refund. The debtor replied she deposited it into her bank account. The trustee then asked, “why are no bank accounts listed in Schedule B?” Her answer was, “you don’t need to know about that. That’s my business.”
This woman displayed a complete lack of honesty. The trustee now knows the bankruptcy petition is a lie, and her testimony in the creditor meeting is suspect as well. The fact is it was apparent that the woman is of very modest means. It is doubtful that she really had anything to hide, and even her tax refund was totally exempt.
The first mistake she made was filing without a lawyer. Yes, we can be expensive. A competent bankruptcy lawyer would explain that the tax refund for 2010, and the one for 2011 would have been hers to keep based on her situation, and there was no reason to hide it, or the bank account. Her meeting of creditors would have been a breeze. Now she will be lucky if all that happens is that her bankruptcy case is dismissed. If the trustee chooses to refer her to the US Attorney, she may be prosecuted and convicted of a bankruptcy felony. It will be a lay up for the criminal division of the US Attorney. All these complications just because she lacked basic honesty when she prepared her bankruptcy case!
For other articles in the nationwide bankruptcy alphabet series check out these attorneys:
- Omaha and Lincoln, Nebraska Bankruptcy Attorney, Ryan D. Caldwell says H is for Hearing.
- New York Bankruptcy Lawyer, Jay S. Fleischman claims H is for Household.
- Northern California Bankruptcy Lawyer, Cathy Moran says H is for House, no not the doctor.
- Colorado Springs Bankruptcy Lawyer Bob Doig says H is for Homestead.
- For another article on the term House check out Los Angeles Bankruptcy Attorney, Mark J. Markus.
- Another very important term in bankruptcy is Household Size by Hilo Bankruptcy Attorney, Stuart T. Ing.
- Livonia, Michigan Bankruptcy Lawyer, Peter Behrmann describes Household Median Income.