Hiding assets in a Chapter 7 bankruptcy

When you file a Chapter 7 bankruptcy, a trustee will be assigned to your case. The trustee’s job is to evaluate your filing and sell off any non-exempt assets to pay off your creditors. The trustees are paid a percentage of the amount they get from selling your assets, so they are motivated to look very carefully for property you did not include in your filing. Your trustee will review public records, the documents you submitted with your filing, search for assets online, and carefully review your debts. Also, anyone with an ax to grind, such as an ex-spouse or ex-business partner, may come forward and tell the trustee about anything you’re trying to hide as well.If the trustee finds out that you’ve tried to hide assets, you may face an array of punishments. Because you sign your bankruptcy petition under the penalty of perjury, if you are lying on any part of it you could face criminal charges resulting in a $500,000 fine, up to 5 years in jail, or both. Also, you will not be entitled to a discharge and you may lose any property that is over the exemption limit. Any debts listed in your fraudulent bankruptcy will not be eligible for discharge in any subsequent bankruptcy. If the trustee finds that you hid assets up to one year after you received your discharge, he or she can revoke your discharge.So, if you try to hide assets from your trustee, you could potentially lose the assets anyway, give up any right to have your debts discharged, face a hefty fine, and spend some time in jail. It’s far better to discuss your options with an experienced bankruptcy attorney first, before you make any mistakes that may cost you not only your property but also your freedom.