Bankruptcy fraud occurs when a person knowingly falsifies information or devises a scheme or artifice during the bankruptcy process with the intent to defraud creditors, the court, and/or another third party (see 18 U.S. Code § 157). It is important to note that you can be charged regardless of the success of the fraudulent scheme.
Examples of Bankruptcy Fraud
Common forms of criminal bankruptcy fraud include:
- The concealment of assets or information, which involves failing to disclose all of your assets, failing to disclose information about a property transfer that you made before filing, asking someone to help you hide property from creditors, downplaying the real value of assets, or destroying or hiding records
- Bribery and embezzlement, which involves stealing funds from a bankruptcy estate, or bribing court officials or bankruptcy trustees
- Making false statements or claims, which involves filing inaccurate or incomplete bankruptcy documents
- Making unauthorized filings, which involves filing a bankruptcy claim with false identification information, filing multiple bankruptcy claims in different jurisdictions, or filing a claim without authorization on someone else’s behalf
Examples of bankruptcy fraud cases include:
- Rietta Miller, charged after concealing assets. Before filing for bankruptcy, Miller received $47,736.12 in a worker’s compensation settlement. She admitted that she concealed these funds from the Bankruptcy court and lied on her petition as well as under oath when asked questions. She pled guilty and was ordered to pay $200 in fines and special assessment fees and to serve 3 years of probation of which the first 6 months would be served under house arrest.
- Cotriena M. Embers, charged after attempting to defraud her apartment complex. Embers filed for bankruptcy using the name and social security number of another person without their consent in order to defraud her apartment complex. She was charged with and eventually pled guilty to bankruptcy fraud, wire fraud, and aggravated identity theft. She was sentenced to 42 months in federal prison and may be expected to pay restitution to the victim of identity theft.
- Tanya Firmani, charged after conspiring to commit foreclosure rescue scams and bankruptcy fraud. Firmani filed and caused others to file fraudulent bankruptcy petitions in the names of homeowners facing foreclosure just before the foreclosure sale. Firmani (a realtor) and her co-conspirators were able to collect fees and commissions for short sales. However, filing for bankruptcy triggered automatic stays that caused creditors to suffer financial losses. A jury found her guilty of 1 count of conspiracy to commit bankruptcy fraud as well as 6 counts of bankruptcy fraud.
- Abigale Lee Miller (Dance Moms Star), charged after concealing assets and failing to report a foreign currency transaction. After filing for bankruptcy, Miller failed to include information about the revenue she earned from merchandise and ticket sales at a dance session she hosted. She also failed to disclose that she transported foreign currency from Australia into the U.S. that totaled approximately $120,000. She was sentenced to 1 year and 1 day of imprisonment.
Consequences of a Conviction
Bankruptcy fraud convictions are punishable by up to $250,000 in fines and/or up to 5 years in prison. In some cases, the prosecution may charge you with other federal crimes (i.e. wire fraud, tax fraud, mail fraud, perjury, conspiracy, etc.) in connection with your bankruptcy charge that carry additional penalties.
Federal convictions can also impact your civil liberties, including but not limited to your right to carry a gun or serve on a jury. You may also struggle to qualify for certain welfare benefits, housing assistance programs, and/or jobs as convictions appear in background checks.
Retain an Experienced Federal Fraud Lawyer Today
If you are being investigated for or have been charged with bankruptcy fraud, you need to contact our attorney as soon as possible. For a conviction, the prosecution will need to prove that you acted with the intent to deceive or delay creditors. Oftentimes, you may have made a mistake when filing that was not intentional, which is why you need to be able to share your side of the story.
Attorney Peter Barrett can help you fight for your rights and freedoms as well as:
- Prepare a personalized legal defense strategy (such as highlighting that you lack intent or that the prosecution has insufficient evidence to prove a crime)
- Understand potential case outcomes (i.e. dismissal, conviction, etc.) and what your best options may be (i.e. negotiating a plea deal or litigating in court)
- Appeal to the judge for leniency in the event of a conviction
With over 25 years of experience, Attorney Peter Barrett is equipped to represent clients facing bankruptcy fraud charges. To learn how he can help you and ensure your side of the story is heard, schedule your case consultation today by completing this online form or calling (214) 307-8667