Common Actions Considered To Be Bankruptcy Fraud

Filing for bankruptcy is serious business and due to the highly detailed nature of filing, one must take extra care not to act in a way that could be considered fraudulent. Bankruptcy fraud can result in having the case dismissed, being prohibited from filing again for a specified period of time or even legal action. Many people do not know the ins and outs of bankruptcy well enough to understand which actions are considered fraudulent.

Fraudulent Actions

The most common type of fraud is concealment of assets, in which some assets are withheld from the bankruptcy petition. This may happen accidentally if a filer forgets to list all of their assets, but in most cases it is purposeful with the intent to protect the asset from potentially being liquidated in the process.

Another common type of fraud is when a debtor files in multiple states or jurisdictions. They  may list different debts and assets for each case or use a false name and identification. Generally, this is done to maximize benefits and obtain the most amount of debt discharge possible.

Regardless of the intent behind the actions, the bankruptcy court does not take fraud lightly. Even if the fraud was accidental and not purposeful, serious consequences could be faced. The best way to prevent accidental or unintentional actions from being deemed fraudulent is to let a bankruptcy attorney handle the case.