Bankruptcy fraud is considered a Federal crime which is a serious offense. This can lead to investigation by the US Trustee’s office and punishment includes fines as well as possible jail time. Bankruptcy fraud is basically concealing assets and not reporting accurate financial information to the Bankruptcy Court. The IRS has some examples of Bankruptcy fraud on their website.
Bankruptcy fraud includes concealing assets held not only before Bankruptcy but also property that may be acquired by the debtor after bankruptcy. If the debtor receives property such as an Inheritance or proceeds of a Life insurance policy within 6 months of filing Bankruptcy, then the debtor should notify the Trustee of this information. If this is not reported, the Bankruptcy discharge may be revoked and will be considered as Bankruptcy fraud.
August 17th, 2009 by Administrator
I just read this article about Mortgage fraud in Reader’s Digest. Unless you have been living under a rock for the past year, surely you would have heard about the companies that advertise on TV/Radio/fliers about Credit consolidation and how they can reduce your mortgage or refinance your home or reduce your debt. They make it seem so easy. But the reality is that it’s never that easy to refinance or reduce your debt. The article provides some great information and resources at the bottom if you really need help with foreclosure or if you think you may be the victim of a housing scam. Also, if you have come to the stage of thinking about bankruptcy, please bear in mind that many bankruptcy petition preparers who advertise really low rates, may be only petition preparers and not attorneys. A bankruptcy attorney would be able to guide you through the whole process of bankruptcy and put your mind at ease. There are various reliable resources online to point you in the right direction starting with your local area bar association. The Massachusetts Bar Association has a Dial-a-Lawyer program where you can call and ask questions to an attorney directly free of charge.
Please be careful during these tough times as the article mentions that scammers may be out there to take advantage of you when you are scared and confused. As always I provide a disclaimer that if you have any questions about Bankruptcy please contact a qualified Bankruptcy attorney in your jurisdiction.
August 4th, 2009 by Administrator
A co-signer is a person who has good credit and can help someone establish their credit by co-signing on the credit card application. This need not necessarily be a credit card application, it may also be a loan on which they can co-sign. Basically what this means is that they would take responsibility for paying the debts if the person whom they co-signed the application for defaults. For example, if Jim (who has good credit) agrees to co-sign an application for Joe (who does not have good credit), and Joe defaults on the credit card balance or loan, then Jim would have to bear the responsibility of paying the debt. Even if Joe files for bankruptcy and discharges the credit card/mortgage/car loan debt, then Jim is still responsible for paying the balance.
An authorized user on the other hand does not co-sign the credit application and therefore does not assume responsibility on the debt. An authorized user can use the credit card (with approval from the credit card holder) but the burden remains on the credit card holder to pay the debt. If Jim is only an authorized user on Joe’s credit card accounts then he does not bear responsibility for paying Joe’s debts. Jim can go to town maxing out the credit card limits and still not be responsible for any of the debts. This would be Joe’s sole responsibility.
So, when you file bankruptcy please be aware of the consequences of being a co-signer. If you think you are an authorized user, you may be just that, but you would be wise to check your credit report and possibly consult a bankruptcy attorney in your jurisdiction. I had a client call me earlier vehemently arguing that he was only an authorized user, but the credit card company had filed a lawsuit and obtained judgment against him as the primary card holder had filed for bankruptcy. As sleazy as credit card companies can be, they probably would not be able to obtain judgment against you if you had as you say, only been an authorized user. A lawsuit is no small matter, it means that it’s time to take the complaint seriously.
A bankruptcy attorney would be able to prevent this situation in the first place. If you have any questions, consult a bankruptcy attorney in your jurisdiction.
August 3rd, 2009 by Administrator
