Posted on August 12, 2019

Federal “Bankruptcy Fraud” Laws – 18 USC § 152 and 18 USC § 157

Bankruptcy fraud is charged under 18 USC § 152[1] and 18 USC § 157[2] making it unlawful to knowingly conceal assets or file a misleading financial statement in a bankruptcy petition.

There are several statute in which someone can be indicted in connection with bankruptcy fraud, including mail/wire fraud, tax evasion, and aggravated identity theft.

Bankruptcy fraud is a felony punishable in federal prison for up to five (5) years. Additionally, the court can impose a fine of up to $250,000, and require you to pay restitution and forfeit assets as a result of the scheme.

Among an array of defenses, the most common is good-faith belief. Moreover, financial documents can be complex, especially when you have a substantial amount of assets. Accordingly, a person can accidentally represent incorrect numbers in a good-faith manner in light of financial complexity.

Bankruptcy fraud can be accomplished in a number of way. Common examples of bankruptcy fraud include:

  • Submitting a false declaration to the bankruptcy court;
  • Intentionally withholding documents to the bankruptcy administrator;
  • Concealing property belonging to the debtor;
  • Concealing or destroying documents related to the debtor or bankruptcy.

If you have been charged or are under investigation for bankruptcy fraud under 18 USC 152 or 18 USC 157, then contact the Law Offices of John D. Rogers to schedule a free confidential consultation with an experienced Orange County federal crimes attorney.

 

 

Legal Footnotes:

[1] 18 U.S.C. § 152 “A person who— (1) knowingly and fraudulently conceals from a custodian, trustee, marshal, or other officer of the court charged with the control or custody of property, or, in connection with a case under title 11, from creditors or the United States Trustee, any property belonging to the estate of a debtor; (2) knowingly and fraudulently makes a false oath or account in or in relation to any case under title 11; (3) knowingly and fraudulently makes a false declaration, certificate, verification, or statement under penalty of perjury as permitted under section 1746 of title 28, in or in relation to any case under title 11; (4) knowingly and fraudulently presents any false claim for proof against the estate of a debtor, or uses any such claim in any case under title 11, in a personal capacity or as or through an agent, proxy, or attorney; (5) knowingly and fraudulently receives any material amount of property from a debtor after the filing of a case under title 11, with intent to defeat the provisions of title 11; (6) knowingly and fraudulently gives, offers, receives, or attempts to obtain any money or property, remuneration, compensation, reward, advantage, or promise thereof for acting or forbearing to act in any case under title 11; (7) in a personal capacity or as an agent or officer of any person or corporation, in contemplation of a case under title 11 by or against the person or any other person or corporation, or with intent to defeat the provisions of title 11, knowingly and fraudulently transfers or conceals any of his property or the property of such other person or corporation; (8) after the filing of a case under title 11 or in contemplation thereof, knowingly and fraudulently conceals, destroys, mutilates, falsifies, or makes a false entry in any recorded information (including books, documents, records, and papers) relating to the property or financial affairs of a debtor; or (9) after the filing of a case under title 11, knowingly and fraudulently withholds from a custodian, trustee, marshal, or other officer of the court or a United States Trustee entitled to its possession, any recorded information (including books, documents, records, and papers) relating to the property or financial affairs of a debtor, shall be fined under this title, imprisoned not more than 5 years, or both.”

[2] 18 U.S.C. § 157 “A person who, having devised or intending to devise a scheme or artifice to defraud and for the purpose of executing or concealing such a scheme or artifice or attempting to do so— (1) files a petition under title 11, including a fraudulent involuntary petition under section 303 of such title; (2) files a document in a proceeding under title 11; or (3) makes a false or fraudulent representation, claim, or promise concerning or in relation to a proceeding under title 11, at any time before or after the filing of the petition, or in relation to a proceeding falsely asserted to be pending under such title, shall be fined under this title, imprisoned not more than 5 years, or both.”

 

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