Bankruptcy Law Questions? Ask a Bankruptcy Lawyer.
Conversion is sometimes called "civil theft." Theft is the equivalent of larceny. Claims based on restitution for larceny are nondischarable, per 11 USC §523(a)(4).
Wish I had the answer you wanted to read, but I don't.
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Since your discharge on the claim is subject to an adversary action, i.e, the creditor must show that your actions should be nondischargable, if you can show that your actions were not willful and malicious, then you may be able to escape from the claim.
As for punitivies, assuming that they are not discharged, then the creditor can continue to attempt to collect by whatever means are legally available. The same Virginia exemptions that would be applicable to bankruptcy are applicable outside of bankruptcy. See http://www.virginia-bankruptcy.com/exemptions.html for a list.
The maximum garnishment of wages is 25% of each after-tax paycheck. Virginia's homestead exemption is only $5,000, so if you have equity in the home, then it is defintely at risk.
Sigh...it was never about truth. We are fortunate that our legal system is better than most. South of the border, there isn't even a pretense of truth, in my view. It's simply the size of the "mortida" that matters. To paraphrase Albert Einstein, "Everything is relative."
I appreciate your confidence, and I wish you peace.