Bankruptcy Fraud

Many of the clauses in the United States Constitution and the Bill of Rights are there to correct
or prevent injustices that were widespread during and before the 18th century. Forced confessions, sham trials, and horrific punishments for relatively minor crimes were the norm in
the old days. Debtors'Debtors' prison, however, remained an option until well into the 19th century, and over time, a series of bankruptcy laws have been passed so that anyone who is unable to pay his or her debts can file for bankruptcy protection through the courts instead of
being imprisoned for nonpayment of debts or having all of his or her property seized. In a Chapter 7 bankruptcy filing, the most common type of bankruptcy case, the court decides how
much property you need to keep to stay out of poverty, and it sells the rest and gives the
proceeds to your creditors. In practice, many financially distressed people go through Chapter 7
bankruptcy without having any of their property liquidated; you get to keep the house you live in
and the car you drive, and most of us do not own any other valuable items of property. If you fill
out your bankruptcy paperwork accurately and thoroughly, the bankruptcy court will almost
certainly approve your case and discharge your eligible debts. If you lie, though, not only will
your bankruptcy filing be rejected, but you could also face criminal charges.  If you are being accused of lying to the bankruptcy court and are under criminal investigation,
contact a Texas white-collar crime lawyer.

Possible Criminal Charges Related to Bankruptcy Filings

The Bankruptcy Code is part of federal law, so criminal charges related to bankruptcy filings go
through the federal courts. Therefore, bankruptcy fraud is a federal crime that carries a
maximum sentence of five years in prison. In practice, there is wide variation among the
sentences that defendants convicted of bankruptcy fraud receive. It depends on whether the
defendant pleads guilty or is convicted at trial and whether he or she has prior criminal
convictions, as well as on the judge's individual choice.
These are some common reasons that people who file for bankruptcy get accused of
bankruptcy fraud:

● They have sold or given away property or titled it in someone else's name shortly before
submitting the bankruptcy filing

● They did not list all their assets on the bankruptcy paperwork

● They knowingly made false statements on the bankruptcy paperwork

As with other criminal charges involving fraud, you can only be convicted if you made the false
statements knowingly and in order to defraud someone, in this case, your creditors and the
bankruptcy court, or to enrich yourself. You cannot be convicted if untrue statements on your
bankruptcy paperwork are honest mistakes. Even if you are already working with a bankruptcy
lawyer, you should hire a criminal defense lawyer if you are being accused of bankruptcy fraud.
Contact the Law Office of Patrick J. McLain, PLLC About Criminal Defense Cases
A Dallas criminal defense lawyer can help you protect yourself from prosecution for bankruptcy
fraud. Contact the Law Office of Patrick J. McLain, PLLC, in Dallas, Texas, to discuss your
case.