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Why Hiding Assets and Property in Bankruptcy is Never a Good Idea

Posted By Allmand Law Firm, PLLC || 30-Apr-2013

Hiding Assets & Personal Property When Filing Bankruptcy

Hiding assets and personal property when filing bankruptcy not only jeopardizes the outcome of your case, you may face criminal prosecution and your debt may not get discharged. Not withholding details about personal property cannot be stressed enough as doing this may hurt your chances of discharging debt in subsequent bankruptcies. Many debtors fear they will lose property of value to their creditors if they disclose details when they file. Yet, failing to provide all information can prohibit you from utilizing exemptions that will protect your assets legally.

Lying about ownership, transferring property title to another person just before filing, and falsifying documents pertaining to the value of your assets are all common ways of hiding valuable possessions.

If your bankruptcy attorney or trustee finds out assets are being hidden you could experience the following:

  • Lose entitlement to debt discharge. Meaning, you will be financially responsible for repaying outstanding debt.
  • Your case could get dismissed. In some cases, your case will remain active but the hidden asset in question may be used to satisfy creditors as a result.
  • A granted discharge gets revoked. This occurs if the trustee learns the debtor had assets hidden after they filed bankruptcy and granted a discharge.
  • Lose privilege of discharging debt in a future filing. If you filed bankruptcy and listed debt that was revoked or denied a discharge in the past, you may be obligated to repay the debt. Meaning, it may not qualify for discharge if included in a future filing.
  • Face federal charges. If you provide false information anytime during your case this could lead to criminal charges including imprisonment and hefty fines.


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