NEW JERSEY CRIMINAL LAWYERS

NJ Bankruptcy Fraud Defense Attorney

Defending Yourself Against Bankruptcy Fraud Charges: Why You Need a NJ Bankruptcy Fraud Defense Attorney

If you are filing for bankruptcy but have crossed the line in stating your financial situation truthfully, you may face the legal consequences of committing bankruptcy fraud. Whether it involves hiding your property, providing false information about your assets or intentionally misrepresenting facts, fraudulent activity during bankruptcy proceedings can result in at least dismissal of your case, and worse, criminal prosecution.

As defined by law, bankruptcy fraud is a severe crime that violates the principles of ethical behavior and honesty required during bankruptcy proceedings. And if found guilty beyond reasonable doubt in federal court, one could face up to five years in jail as well as hefty fines of up to $250000 – penalties no one would wish upon themselves or their loved ones.

This article aims to explore some of the causes and defenses against allegations of committing bankruptcy fraud. If you’re facing such accusations in New Jersey, it is critical to contact a reliable NJ Bankruptcy Fraud defense attorney immediately for assistance.

The Basics of Filing for Bankruptcy

Before delving into the reasons behind bankruptcy fraud charges, let’s first understand what insolvency entails. Typically consumers turn to two options once they reach this point – either file a Chapter 7 or Chapter13 case based on individual circumstances.

Chapter 7 involves liquidating assets; so if possible, protecting all assets from sale by clearing debts leaves nothing for trustees to sell off towards paying down creditors. This ideal scenario presents those with ‘no asset’ situations with an easy way out since they get their discharge without losing any property.

Ultimately eligibility depends on whether you can pass a means test; which gauges whether your monthly income falls below a specific limit set under NJ’s bankruptcy laws. Accordingly, if annual gross earnings fall below N.J.’s median rate then you qualify under one part of the means test. In cases where such income surpasses this projection, deductions can be made towards total earnings that could enable one to qualify under a different part of the means test.

Business entities follow Chapter 11 based on which they propose a repayment plan suggested by creditors while staying operational. On the other hand, filing for Chapter 13 necessitates paying off disposable income over three-five years instead of resorting to asset liquidation.

Acts of Bankruptcy Fraud: Lying, Misrepresentations & Hiding Assets

Lying or misrepresenting facts during insolvency proceedings can be described as overt acts of bankruptcy fraud. Bear in mind that when you submit petitions, schedules, and statements to support your bankruptcy submission paperwork, you sign those under oath – making any false declaration perjury.

At this point, here are some specific questions outlined in bankrruptcy case documentations that should concern you:
– Have you filed for bankruptcy within the last eight years?
– What’s the estimated value and location of vehicles, land investments, jewelry, furniture or tools?
– What transfers or money exchange have been made more notably with elements such as owners/officers/directors of companies or relatives within eight years before Chapter7/Chapter 13 filing?
– What’s your expected monthly income and expenses profile?

Here are some instances when individuals commit bankruptcy fraud:

1. Intentional misrepresentation:
When a petitioner lies intentionally on their bankruptcy schedules to either hide a non-qualifying situation where they file for chapter 7 anyway or keep their assets hidden from trustees tasked with using sale proceeds to pay off creditors. In situations involving Chapter13 filings too lying about underreporting or hiding trackable sources can also result in dire consequences.

2. _Asset manipulation_:
Those violating regulations may move around assets in several ways like transferring said properties into phony shells/entities/fake identities as well as family members colluding to conceal certain property ownership.

Evidence in Bankruptcy Fraud Cases

As with most white-collar crimes, bankruptcy fraud cases may hinge on examining the financial documents necessary for filing insolvency. Suppose you report less income via bankruptcy filings than when applying for a mortgage, for instance. In that case, an investigation of mortgage applications, W-2 forms detailing earnings by employers and other tax returns could unearth inconsistencies or solid evidence of fraud.

Investigations can also make use of social media posts such as pictures showcasing lavish lifestyles or any property acquisitions that don’t match up to filings provided in bankruptcy proceedings.

Defending a Bankruptcy Fraud Prosecution

An experienced NJ Bankruptcy Fraud defense attorney will help establish whether the Prosecutor proves intent beyond reasonable doubt so that this key element in making claims against you cannot be established. The attorney can build a defense around possible happenstances where you might mistakenly have been confused over the questionnaire’s verbiage, made mistakes while providing details about your inheritance from extended family members about certain assets or miscalculated your average expenses/income data.

By showing that any misunderstandings were corrected as soon as they came to light by informing the trustee tasked with supervising and pointing out professional errors committed despite good faith efforts portrayed to be corrected expeditiously – which abrogates some elements of criminal intention needed to establish fraud charges successfully.

In specific circumstances such as hiding assets, relieving oneself involves gaining immunity from legal action taken within five years since obtaining Chapter 7/13 discharge notice. Henceforth it is paramount to act as a matter of urgency in seeking an attorney who specializes in defending against allegations pertaining primarily to bankruptcy fraud.

Here’s a table highlighting some essential differences between Chapter 7&Chapter 13 cases:

| Aspect | Chapter 7 | Chapter 13 |
|————————————–|—————————————————-|——————————————|
| Lengthy | Typically lasts four-six months | Takes three-five years to complete |
| Asset liquidation | All non-exempt properties sold by trustee | Petitioner retains certain properties |
|Income Requirements | Qualifies if monthly income falls below threshold | Disposable monthly income over $100 |
| Debts paid | None | Set amount negotiated with creditors |
| Means Test Qualified? | Under NJ’s Chapter 13 | Based on earnings and expense history |

As seen from this table, understanding the bankruptcy process like the back of one’s hand is a critical success factor to avoid issues that could warrant bankruptcy fraud allegations. It takes ample research, seeking professional guidance from financial advisors and legal experts who have dealt with these cases. They can help steer you in the right direction and make informed decisions about your insolvency options.