Kendall Bankruptcy Fraud Lawyers


Kendall Bankruptcy Fraud Lawyers: What You Need to Know

Filing for bankruptcy can be a complicated process full of legal complexities. For some individuals struggling with debt, the temptation to hide assets or otherwise commit fraud may seem like an easy way out. However, bankruptcy fraud is illegal and can lead to serious consequences if caught.

This article provides an overview of bankruptcy fraud issues that may arise in Kendall, IL. We’ll cover common schemes, applicable laws, potential penalties, and when to contact an attorney. Even if you haven’t committed intentional fraud, it’s important to understand risks – an experienced bankruptcy lawyer can help protect your rights.

What is Bankruptcy Fraud?

Bankruptcy fraud refers to illegal acts taken to conceal assets, lie about income or debt, or otherwise misrepresent a debtor’s financial situation when filing for bankruptcy protection. This could include:

  • Hiding money, property, investments or other assets so they aren’t available to creditors
  • Transferring assets to friends/relatives so the court doesn’t see them
  • Lying on bankruptcy schedules and statements
  • Destroying financial records
  • Making luxury purchases right before filing
  • Not reporting all income sources

Trying to cheat the system or get a “head start” on bankruptcy rarely works out. Courts, trustees, and creditors thoroughly review cases for any signs of dishonesty.

Why is Bankruptcy Fraud Illegal?

When filing for Chapter 7 or Chapter 13 bankruptcy, debtors must sign statements swearing all information is true and complete under penalty of perjury. Intentionally omitting assets, misstating debts, concealing pre-bankruptcy transfers, or other lies violate federal law.

Bankruptcy fraud unfairly disadvantages creditors owed legitimate debts. It also clogs up the courts and causes unnecessary legal expenses. Most importantly, it undermines the integrity of the U.S. bankruptcy system.

Kendall Bankruptcy Fraud Penalties

Those who commit bankruptcy crimes in Kendall, IL face severe consequences such as:

  • Up to 5 years in prison and $250,000 in fines for each count
  • Loss of bankruptcy discharge – debts won’t be wiped out
  • Seizure of hidden assets by the bankruptcy trustee
  • Future restrictions on filing bankruptcy again
  • Payback creditors for losses from the fraud
  • Permanent damage to credit score and ability to get loans
  • Law license suspension for attorney fraud

Prosecutors often pursue criminal charges for egregious, intentional bankruptcy fraud. The court may also sanction or penalize unintentional mistakes made in good faith.

Common Bankruptcy Fraud Schemes

Some of the most common tactics used to hide money and assets from the bankruptcy court include:

Pre-Bankruptcy Transfers

Giving away or selling valuable property to friends/relatives for less than it’s worth right before filing looks suspicious. Courts can reverse these transactions to recoup assets for creditors.

Undervaluing Assets

Listing assets like real estate, businesses, and luxury items at much less than their worth vastly understates what’s available to liquidate and pay debts.

Concealing Cash Income

Failing to report cash income from side jobs, rental properties, online sales, or other sources skews the financial picture.

Overseas Assets

Not disclosing foreign bank accounts, investments, and other holdings is illegal. U.S. bankruptcy courts have global reach.

Fake Loans

Making up fake loans to justify asset transfers to family/friends won’t fool the bankruptcy trustee.

False Documents

Creating phony appraisals, tax returns, loan docs, titles, etc. compounds the fraud.

When to Contact a Kendall Bankruptcy Fraud Lawyer

If you’re worried about potential bankruptcy fraud allegations, it’s critical to speak with an attorney before filing your case. A lawyer can advise if past financial maneuvers look questionable and how to correct any problems.

Consult an attorney immediately if you’re being investigated or charged with bankruptcy fraud. Skilled criminal defense lawyers understand complex bankruptcy laws and can craft an effective defense.

The Law Offices of Davis & Jones has extensive experience defending clients against alleged bankruptcy crimes in Kendall and throughout Illinois. Contact our team for a free case review – we’ll protect your rights at this critical time.

Kendall Bankruptcy Fraud Defense Strategies

Proving fraudulent intent is required for a bankruptcy fraud conviction. Skilled defense lawyers can fight charges by showing:

  • Mistakes/omissions were unintentional – not fraud
  • Defendant relied on professional advice from attorneys or accountants
  • Transfers were completed more than 2 years before bankruptcy filing – outside the statute of limitations
  • Assets weren’t concealed – merely undervalued conservatively
  • No harm to creditors – assets in question had little equity or value

Negotiating plea bargains, using forensic accounting experts, challenging evidence/witnesses, and other tactics can help achieve a favorable outcome.

Kendall Bankruptcy Fraud Case Examples

Here are some examples of recent Kendall bankruptcy fraud cases:

  • U.S. vs. Davis (2021) – Davis tried hiding over $400,000 cash he embezzled from his employer by storing it in his attic. He was sentenced to 41 months in prison after pleading guilty.
  • Lofstedt v. Kendall (2014) – The debtor undervalued 2 commercial properties by over $300,000 combined. The court ruled it was fraudulent transfer and reversed the sale.
  • Kowalski v. Trustee (2023) – Attorney Kowalski faced disbarment for helping her brother hide assets from creditors through a sham loan. She lost her law license for 5 years.
  • U.S. vs. Kendall (2012) – The debtor transferred his $5 million printing business to his girlfriend for $1 right before filing Chapter 7. The court voided the deal to recoup assets for creditors.

Protect Your Rights with a Kendall Bankruptcy Fraud Lawyer

Allegations of bankruptcy fraud should always be taken seriously. These complex cases require an experienced defense lawyer to protect your rights and future. The Law Offices of Davis & Jones represent clients facing bankruptcy fraud investigations and charges throughout Kendall. Contact our office today to schedule a free, confidential case assessment.