Bankruptcy fraud is a federal felony that can carry with it a number of severe penalties if the defendant is found guilty, ranging from heavy fines to years in prison. It can encompass a number of different offenses but the most common is of a bankruptcy filer deliberately hiding or lying about the value of their assets to the court.
However, cases can happen where, because of some error or misconception, one may find themselves wrongly accused of bankruptcy fraud. In case you are wondering what to do if you are charged with bankruptcy fraud, here are some legal options available.
Claim It’s a Mistake
If you failed to disclose information on any of your assets in your bankruptcy petition, you could claim that you did so mistakenly. Remember the burden of proof lies with the prosecutors. They will need to show enough evidence to prove beyond a reasonable doubt that it wasn’t a mistake but a deliberate action on your part.
Present a Legitimate Purpose
You can claim as a defense that your action, while deliberate, was done with the intention of a lawful purpose. For instance, you can say that car you sold to your friend at half its value wasn’t to commit bankruptcy fraud but to take advantage of a tax deduction. Again, prosecutors must provide proof of the action being taken with malicious intent for you to be declared guilty.
Withdrawal of Your Bankruptcy Case
If you are still under the Bankruptcy process and are charged with bankruptcy, you could choose to withdraw or renunciate your bankruptcy case. You could testify to the court that you regretted the decision to omit the asset intentionally or that a correction of the paperwork soon after you discovered the mistake. Either way, you can then file a new petition with the correct information presented.
Statute of Limitations
If you are charged with bankruptcy fraud for an offense that occurred years ago, you could argue in your defense that the statute of limitations has already elapsed. Thus, it could be claimed the government has no right to bring up these charges against you. For most bankruptcy fraud-related crimes, the statute of limitations is set at five years starting from the date of the offense or five years from the date or denial of discharge in case of deliberate asset concealment.
Hire a Bankruptcy Lawyer
Being wrongly charged with bankruptcy fraud can be traumatic and if declared guilty, completely ruinous. If you are facing such charges or suspect that you do, it is highly recommended to consult with a professional bankruptcy attorney on your options. For residents in the state of Texas, book a free consultation today with our law office by calling us on our number – 512.640.3340.
For more information, speak with an experienced bankruptcy attorney – schedule your free 1-hour consultation today: https://seanflynnlaw.com/calendar/