Bankruptcy Law

Bankruptcy Law Questions? Ask a Bankruptcy Lawyer.

Ask a Lawyer,
Get an Answer ASAP!

Bankruptcy Law

Can the DOJ make a bankruptcy fraud claim on a fully

Customer Question
discharged bankruptcy that was not...
Can the DOJ make a bankruptcy fraud claim on a fully discharged bankruptcy that was not objected to?
BACKGROUND:
An indictment for bankruptcy fraud has been filed. The indictment claims that real estate were hidden in family member names.
In the bankruptcy, the largest creditor was the IRS. Agents attended the BK hearing and a 2004 examination was conducted.
The BK court granted the bankruptcy and it was discharged without any adversarial actions or objections.
Now Federal prosecutors, through their own investigations and the grand jury have filed an indictment.
So - are there examples of cases that were brought forward for bankruptcy fraud before the original bankruptcy discharge was revoked?
Submitted: 1 year ago.Category: Bankruptcy Law
Show More
Show Less
Ask Your Own Bankruptcy Law Question
Answered in 1 hour by:
8/22/2016
Bankruptcy Lawyer: Maverick, Attorney replied 1 year ago
Maverick
Maverick, Attorney
Category: Bankruptcy Law
Satisfied Customers: 6,426
Experience: 20 years of professional experience
Verified

Welcome! My name is Maverick. Please give me a few minutes to analyze and/or research your inquiry and I will be back.

Ask Your Own Bankruptcy Law Question
Bankruptcy Lawyer: Maverick, Attorney replied 1 year ago

Based on the laws cited below the DOJ can prosecute a BK fraud action for up to five years from the date of discharge.

841. Concealment of Property—18 U.S.C. § 152(1)

The concealment of property can be charged under either 18 U.S.C. § 152(1) or § 152(7). One of the important differences between these two paragraphs is that under Subsection (1) the property which was concealed must be property of the bankruptcy estate.

Subsection (1) of Section 152 provides that:

A person who . . . knowingly and fraudulently conceals from a custodian, trustee, marshal, or other officer of the court charged with the control or custody of property, or, in connection with a case under title 11, from creditors or the United States Trustee, any property belonging to the estate of a debtor;. . .shall be fined. . ., imprisoned. . ., or both.

The elements of the offense of concealment under 18 U.S.C. § 152(1) that the government must prove are:

  1. the bankruptcy proceeding was in existence;
  2. the defendant fraudulently concealed the property from the custodian; and
  3. the property belonged to the bankruptcy estate.

Devitt, Blackmar & O'Malley, 2 Federal Jury Practice and Instructions, § 24.03 (4th ed. 1990); United States v. Guiliano, 644 F.2d 85, 87 (2d Cir. 1981); United States v. Beery, 678 F.2d 856 (10th Cir. 1982),cert. denied, 471 U.S. 1066 (1985).

Title 18 U.S.C. § 3284 contains a special statute of limitations which applies to concealment of assets cases:

The concealment of assets of a debtor in a case under title 11 shall be deemed to be a continuing offense until the debtor shall have been finally discharged or a discharge denied, and the period of limitations shall not begin to run until such final discharge or denial of discharge.

    Where the debtor either receives a discharge or is denied a discharge by court order, the application of § 3284 is easy. The five year period begins with the date of the discharge or denial of the discharge.

    Note: (1) Just Answer’s site disclaimers apply to all levels of service; (2) Most follow-up questions are answered with in the hour; however, if I am not signed on, please allow up to 24 hours; and (3) If we are done, please assign a feedback rating so Just Answer will compensate me for your question. Thank you for using Just Answer.

    Ask Your Own Bankruptcy Law Question
    Customer reply replied 1 year ago
    Hi Maverick,Thanks for the response, but my question wasn't really trying to get at the statute of limitations. The heart of the question is more - before the DOJ may pursue the criminal case, don't they have a duty to object with the bankruptcy court first? If they do believe that there is fraud, isn't not working to overturn the discharge first prejudicial to the creditors in the bankruptcy? Are there cases I can refer to where defendants were charged and found guilty of BK fraud without having an objection to or a reversal of their previously discharged BK? Better yet, are there any cases where courts have found that the existence of an intact bankruptcy, in the absence of any new evidence, formed a kind of estoppel for a fraud charge ?
    Bankruptcy Lawyer: Maverick, Attorney replied 1 year ago

    Please re-read the answer that I provided. What the law is saying is that the DOJ may pursue a fraud charge EVEN IF your BK was discharged. Also notice that the elements of the fraud claim do not depend on whether the case was discharged or not.

    Ask Your Own Bankruptcy Law Question
    Bankruptcy Lawyer: Maverick, Attorney replied 1 year ago

    Please see part answer above. I am finding some authority for the proposition that a BK judge can revoke a discharge and refer it to the US Atty's office for criminal prosecution; but I do not see anything that says that revoking the discharge is a prerequisite to criminal prosecution.

    Ask Your Own Bankruptcy Law Question
    Customer reply replied 1 year ago
    this is the track of thought I was pursuing. The DOJ must be referred a case. In this instance, the referring party was the IRS. The IRS has believed for years that there were hidden assets in this case as they pursued it. They attended the bankruptcy proceedings and called for a 2004 exam. They made their case to the judge that there was fraud, but the BK judge did not agree, and the bankruptcy was granted. There were no further follow up or objections (which it is their right to do). So then, they decided to take the case to the DOJ to continue pleading their case about hidden assets. The DOJ has followed through all the way through indictment and mention restitution to the IRS in their filings - however they make no effort to pursue restitution on behalf of any other creditors - this seems like unfair preference to the IRS - who is using the DOJ as their personal collection agency in this case. So I am hoping to see if there has ever been another case where a fraud indictment came BEFORE a discharge was overturned in BK court.
    Bankruptcy Lawyer: Maverick, Attorney replied 1 year ago

    I will have to opt out and let another expert try. I have spent well over an hour trying to find case law on this for you using the free legal databases that I have access to. If you do not find a satisfactory answer, please let me know as I may have to make a trip to the law library to find a definitive answer for you. My fee to do that would be $300.00

    Ask Your Own Bankruptcy Law Question
    Bankruptcy Lawyer: N Cal Atty, Attorney replied 1 year ago
    N Cal Atty
    N Cal Atty, Attorney
    Category: Bankruptcy Law
    Satisfied Customers: 9,531
    Experience: Since 1983
    Verified

    New Expert here.

    Has the government identified any specific property that was alleged to have been concealed during the bankruptcy case?

    Ask Your Own Bankruptcy Law Question
    Ask N Cal Atty Your Own Question
    N Cal Atty
    N Cal Atty
    N Cal Atty, Attorney
    Category: Bankruptcy Law
    Satisfied Customers: 9,531
    9,531 Satisfied Customers
    Experience: Since 1983

    N Cal Atty is online now

    A new question is answered every 9 seconds

    How JustAnswer works:

    • Ask an ExpertExperts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
    • Get a Professional AnswerVia email, text message, or notification as you wait on our site. Ask follow up questions if you need to.
    • 100% Satisfaction GuaranteeRate the answer you receive.

    JustAnswer in the News:

    Ask-a-doc Web sites: If you've got a quick question, you can try to get an answer from sites that say they have various specialists on hand to give quick answers... Justanswer.com.
    JustAnswer.com...has seen a spike since October in legal questions from readers about layoffs, unemployment and severance.
    Web sites like justanswer.com/legal
    ...leave nothing to chance.
    Traffic on JustAnswer rose 14 percent...and had nearly 400,000 page views in 30 days...inquiries related to stress, high blood pressure, drinking and heart pain jumped 33 percent.
    Tory Johnson, GMA Workplace Contributor, discusses work-from-home jobs, such as JustAnswer in which verified Experts answer people’s questions.
    I will tell you that...the things you have to go through to be an Expert are quite rigorous.

    What Customers are Saying:

    Mr. Kaplun clearly had an exceptional understanding of the issue and was able to explain it concisely. I would recommend JustAnswer to anyone. Great service that lives up to its promises!

    Gary B.Edmond, OK

    My Expert was fast and seemed to have the answer to my taser question at the tips of her fingers. Communication was excellent. I left feeling confident in her answer.

    EricRedwood City, CA

    I am very pleased with JustAnswer as a place to go for divorce or criminal law knowledge and insight.

    MichaelWichita, KS

    PaulMJD helped me with questions I had regarding an urgent legal matter. His answers were excellent.

    Three H.Houston, TX

    Anne was extremely helpful. Her information put me in the right direction for action that kept me legal, possible saving me a ton of money in the future. Thank you again, Anne!!

    ElaineAtlanta, GA

    It worked great. I had the facts and I presented them to my ex-landlord and she folded and returned my deposit. The 50 bucks I spent with you solved my problem.

    TonyApopka, FL

    Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help.

    Mary C.Freshfield, Liverpool, UK

    < Previous | Next >

    Meet the Experts:

    Terry L.

    Terry L.

    Attorney

    2,679 satisfied customers

    Better Business Bureau. 18yrs bankruptcy experience. Chicago Bar Assoc. American Bankruptcy Institute member.

    cortrightlaw

    cortrightlaw

    Attorney

    511 satisfied customers

    Attorney practicing Bankruptcy Law including Chapter 7, Chapter 11, Chapter 12, and Chapter 13.

    JoeLawyer

    JoeLawyer

    Attorney

    376 satisfied customers

    Attorney in the practice of Bankruptcy Law since 1996

    A.J.

    A.J.

    Attorney

    262 satisfied customers

    Experienced consumer bankruptcy attorney.

    Fritz

    Fritz

    Attorney

    209 satisfied customers

    Florida attorney with extensive experience in Chapter 7 and Chapter 13 consumer bankruptcy cases

    Law Girl

    Law Girl

    Attorney

    153 satisfied customers

    I am an attorney.

    Paul K, Esq.

    Paul K, Esq.

    Attorney

    141 satisfied customers

    10 years Exp., Great customer service, Prompt responses.

    < Previous | Next >

    Related Bankruptcy Law Questions
    Received a notice of automatic dismissal without the entry
    Received a notice of automatic dismissal without the entry of a discharge. for failure to file documents. a/b, D, E/F,I,J,J2,statement of your current monthly, income BUT I filed these forms but at 2 … read more
    DrakeLAW
    DrakeLAW
    Juris Doctorate
    984 satisfied customers
    Law Educator I am attaching my rough draft to the trustee
    Law Educator I am attaching my rough draft to the trustee -please advise in your professional opinion if there is something that needs to be deleted or added. Also, I am attaching the minute entry to … read more
    PaulmoJD
    PaulmoJD
    Attorney At Law
    Doctoral Degree
    106 satisfied customers
    If the trustee rules that the person filing for bankruptcy
    If the trustee rules that the person filing for bankruptcy has an equitable interest in real estate, can that ruling interfere with his exemption. Or is he allowed then to file for his right of redemp… read more
    DrakeLAW
    DrakeLAW
    Juris Doctorate
    984 satisfied customers
    I had a hearing in bankruptcy court- does this mean I wasn't
    I had a hearing in bankruptcy court- does this mean I wasn't supposed to defend myself against the one who called for the hearing?… read more
    PaulmoJD
    PaulmoJD
    Attorney At Law
    Doctoral Degree
    106 satisfied customers
    If you have a trial scheduled and the US Trustees Office is
    If you have a trial scheduled and the US Trustees Office is trying to get your case dismissed and you have been dealing with your attorney who has been doing things that will get him disbarred, how do… read more
    Michael Bradley
    Michael Bradley
    JD
    1,193 satisfied customers
    In Utah there is a statute of limitation with respect to
    In Utah there is a statute of limitation with respect to collecting on a note. If the creditor has made contact with the debtor during the period does that protect the creditor from having the statute… read more
    Ely
    Ely
    Counselor at Law
    Juris Doctor
    266 satisfied customers
    I have a question about the statute of limitations under
    I have a question about the statute of limitations under UFTA or its successor statute. If I understand it correctly, a person who is deemed to have transferred something of value may be adjudicated o… read more
    DrakeLAW
    DrakeLAW
    Juris Doctorate
    984 satisfied customers
    I received a letter from the united states bankruptcy court
    i received a letter from the united states bankruptcy court southern district of new york … read more
    Barrister
    Barrister
    Attorney/Landlord/Realtor
    Doctoral Degree
    35,358 satisfied customers
    I filed bankruptcy and just received a notice saying
    hello. I filed bankruptcy and just received a notice saying sheriffs notice of bankruptcy procedures. pursant to a creditors instructions under a writ of execution , the sheriff levied on and is curre… read more
    DrakeLAW
    DrakeLAW
    Juris Doctorate
    984 satisfied customers
    I have hard evidence that the Trustee and Trustee atty were
    Hello - I have hard evidence that the Trustee and Trustee atty were negligent, breached their fiduciary duties and allowed my federal case of fraud in the inducement run the SOL, without pursuing as t… read more
    Dwayne B.
    Dwayne B.
    Juris Doctor
    28,693 satisfied customers
    The Trustee in a corporate bankruptcy case erased and/ or
    The Trustee in a corporate bankruptcy case erased and/ or deleted tape recorded testimony of a key witness in a 2004 bankruptcy rule deposition. what recourse do I have being that witnesses testimony … read more
    Legal Eagle
    Legal Eagle
    Attorney
    Doctoral Degree
    7,403 satisfied customers
    Second opinion] The Trustee in a corporate bankruptcy case
    Second opinion] The Trustee in a corporate bankruptcy case erased and/ or deleted tape recorded testimony of a key witness in a 2004 bankruptcy rule deposition. what recourse do I have being that witn… read more
    DrakeLAW
    DrakeLAW
    Juris Doctorate
    984 satisfied customers
    My confirmation meeting is next week and th trustee wants a
    my confirmation meeting is next week and th trustee wants a modified plan so i won't be confirmed, what may happen … read more
    Phillips Esq.
    Phillips Esq.
    Attorney
    Juris Doctor
    18,377 satisfied customers
    I am not sure. I got sued by a collection agency and am
    I am not sure. I got sued by a collection agency and am trying to file my Answer correctly … read more
    Barrister
    Barrister
    Attorney/Landlord/Realtor
    Doctoral Degree
    35,358 satisfied customers
    Bankruptcy court trial hearing Brief needed. I am a
    Bankruptcy court trial hearing Brief needed. I am a Creditor, already finished a Rule 2004 exam on Debtor, out of court. I must file brief and exhibits by this Friday.… read more
    PaulmoJD
    PaulmoJD
    Attorney At Law
    Doctoral Degree
    106 satisfied customers
    I received notice from the Trustee of an "Order Striking
    I received notice from the Trustee of an "Order Striking Filing For Failure To Comply With Required Procedures".I believe the problem is with a creditor who had an undeliverable address, however, I ha… read more
    DrakeLAW
    DrakeLAW
    Juris Doctorate
    984 satisfied customers
    If payment is being made to a collection agency on regular
    If payment is being made to a collection agency on regular bases for several months and then you increased payment can they still take you to court or force you to go into bankruptcy?… read more
    Ely
    Ely
    Counselor at Law
    Juris Doctor
    266 satisfied customers
    In Utah, is there a difference in the statute of limitations
    In Utah, is there a difference in the statute of limitations on a "fraudulent transfer" in a bankruptcy compared to a judgement execution?… read more
    Ely
    Ely
    Counselor at Law
    Juris Doctor
    266 satisfied customers

    DISCLAIMER: Answers from Experts on JustAnswer are not substitutes for the advice of an attorney. JustAnswer is a public forum and questions and responses are not private or confidential or protected by the attorney-client privilege. The Expert above is not your attorney, and the response above is not legal advice. You should not read this response to propose specific action or address specific circumstances, but only to give you a sense of general principles of law that might affect the situation you describe. Application of these general principles to particular circumstances must be done by a lawyer who has spoken with you in confidence, learned all relevant information, and explored various options. Before acting on these general principles, you should hire a lawyer licensed to practice law in the jurisdiction to which your question pertains.

    The responses above are from individual Experts, not JustAnswer. The site and services are provided “as is”. To view the verified credential of an Expert, click on the “Verified” symbol in the Expert’s profile. This site is not for emergency questions which should be directed immediately by telephone or in-person to qualified professionals. Please carefully read the Terms of Service (last updated February 8, 2012).

    DISCLAIMER: Answers from Experts on JustAnswer are not substitutes for the advice of an attorney. JustAnswer is a public forum and questions and responses are not private or confidential or protected by the attorney-client privilege. The Expert above is not your attorney, and the response above is not legal advice. You should not read this response to propose specific action or address specific circumstances, but only to give you a sense of general principles of law that might affect the situation you describe. Application of these general principles to particular circumstances must be done by a lawyer who has spoken with you in confidence, learned all relevant information, and explored various options. Before acting on these general principles, you should hire a lawyer licensed to practice law in the jurisdiction to which your question pertains.

    The responses above are from individual Experts, not JustAnswer. The site and services are provided “as is”. To view the verified credential of an Expert, click on the “Verified” symbol in the Expert’s profile. This site is not for emergency questions which should be directed immediately by telephone or in-person to qualified professionals. Please carefully read the Terms of Service (last updated February 8, 2012).

    Show MoreShow Less

    Ask Your Question

    x