The bankruptcy laws are designed to give honest people a fresh start on their credit. As your lawyer will explain to you, there are severe penalties and sanctions for failing to honestly disclose all of your assets, liabilities, income, expenses, and financial affairs when you file your case. Without exception, I always advise all of my clients to be painstakingly honest and disclose everything to your bankruptcy lawyer San Diego. Your lawyer can then determine which information needs to be included in the papers filed with the court. Usually, it means disclosing everything. However, there are technical exceptions where certain items or information need not be disclosed.
Discuss Bankruptcy Disclosures With a Lawyer
Failure to disclose all of your assets, liabilities, income, expenses, and financial affairs can result in you being denied bankruptcy relief in San Diego and you to be charged with committing a crime. You could possibly be charged with a felony and imprisoned for up to 5 years, and you could be fined up to $250,000 (for individuals) or $500,000 (for corporations). There’s no doubt: honest is the best policy. Just tell the truth, as any honest debtor would. This is definitely something that you'll want to discuss with your bankruptcy lawyer San Diego.
As a practical matter, not disclosing your assets and other financial information may not always land you in jail for 5 years and can result in imposition of a $250,000 fine. Sentencing guidelines are usually based on the facts of the case, such as the amount of loss suffered by parties affected by the nondisclosure, whether any court orders were violated, the extent of involvement or active concealment, and other matters. Nondisclosure may only result in the dismissal of your case or forced sale of assets. Still, the possibility of significant jail time as well as the possibility of a very large fine is real and is a strong deterring factor (against nondisclosure) that, hopefully, ensure that in each case all assets and other information are fully disclosed.
When you disclose your assets, liabilities, income, expenses, and financial affairs to your lawyer, disclose them fully and completely and accurately as possible. Disclose the replacement value (or current market value) of each of your assets after reasonable inquiry to establish such value. Disclose your currently monthly income, and your current monthly expenses, after reasonably inquiry to establish the same.
You and your lawyer's duty to truthfully disclose all of your assets and other financial information extends beyond the context of your petition and schedules and accompanying statements that are filed in connection with your case. Honestly testify regarding your assets and other financial information at any hearing. If information you provided is audited by the trustee appointed to your case or the U.S. Trustee's office, cooperate in providing additional documents needed to complete the trustee’s investigation.
The crime of nondisclosure or concealment of assets, which is a Federal bankruptcy crime, may also take the form of transferring or concealing property before you file for bankruptcy and then not disclosing the transferred or concealed assets when you were supposed to disclose it in your bankruptcy filing.
So do you need to worry or fret about the possibility of jail time? No. Just be 100% forthcoming in disclosing all information to your lawyer and let your lawyer make the call as to whether the information must be disclosed in your petition, schedules and accompanying papers. When in doubt, always err on the side of full and complete disclosure.