When you choose to file a Chapter 7 bankruptcy, your primary concern is probably to overcome financial challenges or find relief from overwhelming debt. You may be worried about the liquidation of your assets, though. We at the Law Offices of George Castrataro, P.A., understand that it can be tempting to take measures that prevent certain assets from being affected by the liquidation process. However, failing to disclose all of your assets can get you into criminal trouble.
Cornell University Law School’s Legal Information Institute defines bankruptcy fraud as a white-collar crime. While there is more than one type of fraud that can be committed, the most common is hiding assets. Engaging in this behavior is considered a federal crime and if you are convicted, you could be sentenced to prison time and/or ordered to pay thousands of dollars in fines.
It may seem like a good idea to hand over an asset such as a car, boat or home to a family member or friend in order to keep from losing it. However, transferring ownership of your property to another is also considered concealment of assets. Additionally, filing for bankruptcy in more than one state is also illegal and could leave you facing more than just financial trouble.
If retaining assets is more important than eliminating debt altogether, Chapter 13 bankruptcy may be a better alternative to Chapter 7. A person may be able to avoid losing a home or transportation while staying safely within bankruptcy guidelines. For more information on this topic, please visit our page that discusses the types of bankruptcy.