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A debtor must be honest and accurate in dealing with the court or face serious consequences, including being charged with a bankruptcy crime. SOURCE: Federal Judiciary Channel (YouTube)

TRANSCRIPT:

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The following program was
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produced by the United States Courts.
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A debtor must be very accurate in his or her dealings with the court,
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including filling out the statement of financial affairs and schedules accurately.
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These papers and a debtor’s testimony at the 341 meeting are sworn to under
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penalty of perjury. There can be severe consequences for violating this duty.
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Let’s hear from a bankruptcy judge: Judge Paul M. Glenn.
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“Bankruptcy is not
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a step to be taken lightly or casually.
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It’s a serious event.
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It has some real benefits. I mean it will help people save their homes,
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it will help people relieve themselves from overwhelming debt.
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But, along with those benefits there are some serious responsibilities that go along.
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There’s a petition and financial statements that have to be filed when a person files
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their bankruptcy case.
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And these are signed under oath, these are sworn documents.
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They’ve signed under oath and under penalty of perjury.
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Sometimes people will
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transfer
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vehicles or personal property or things to their relatives or their parents or their kin
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to hold for them for a period of time while they go through bankruptcy.
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That is clearly a non-disclosure of assets and is a bankruptcy fraud.
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So any transfers that have been made
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within the last period of time have to be disclosed.
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In addition to
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the oath that goes along with the signature, all the papers are signed
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under one of the rules of the bankruptcy courts; and that is, the signature is a certification
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that to the best of the person’s knowledge and information and belief,
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the representations are accurate, the facts are accurate. The consequences of
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not being
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candid and not being truthful on the schedules:
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there’s a criminal law
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that says
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that if anyone files a petition or files a document
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that makes a false or fraudulent representation
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then they are subject to criminal prosecution,
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which it provides for fines or imprisonment even up to five years,
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for both of those.
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So it’s a serious crime if there are material misstatements
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that could be prosecuted.
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The consequences of
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fudging
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are just too severe to risk.
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You risk the discharge,
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you risk
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committing a crime. And the chances are likely that you’ll get caught because
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the trustees who review these schedules in the trustee meetings
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review thousands, and they see thousands of people. They know the questions to ask.
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The questions that they ask in the meeting have to be responded to under oath.
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And then creditors come to the meeting and creditors are able to
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have their input as well.
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The likelihood that non-disclosures will be found,
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and if they are, then there are serious consequences. Sloppiness and gross negligence
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are among those criteria
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that will lead to
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the conclusion that the omission is intentional. Take your time, get it right, and be honest.”