How bad is it to lie to a federal bankrupcy court? 28 Answers as of July 11, 2013

I know a person who lied about their income, place of residence and a couple of other things when they filed for chap. 13 bankruptcy. Am I in trouble for having this knowledge and not reporting it? Who do I report it to? Is this kind of thing (being deceptive to the bankruptcy court) common practice? Is this considered a bad crime? Please, Help.

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Dan Shay Law
Dan Shay Law | Daniel Shay
Such offenses would be reported to the US Trustee in your district.
Answer Applies to: California
Replied: 7/14/2011
Mercado & Hartung, PLLC
Mercado & Hartung, PLLC | Christopher J. Mercado
Yes, you should be truthful on your BK petition at all times.
Answer Applies to: Washington
Replied: 6/10/2013
Law Office of Maureen O' Malley
Law Office of Maureen O' Malley | Maureen O'Malley
It's serious to lie. If you know of a lie, you should report it to the trustee. It's not common practice to lie.
Answer Applies to: Virginia
Replied: 7/11/2011
Bankruptcy Law office of Bill Rubendall
Bankruptcy Law office of Bill Rubendall | William M. Rubendall
Lying in bankruptcy is a criminal action. The penalty can be five years in prison or a fine of $250,000 or both.
Answer Applies to: California
Replied: 7/11/2011
William C. Gosnell, Attorney at Law
William C. Gosnell, Attorney at Law | William C. Gosnell
BANKRUPTCY FRAUD IS A FEDERAL FELONY AND CARRIES ONE YEAR IN FEDERAL PRISON. TELL THE PERSON TO HIRE A CRIMINAL DEFENSE LAWYER IMMEDIATELY. TELL THE PERSON TO HAVE HIS BANKRUPTCY ATTORNEY AMEND HIS PLEADINGS IMMEDIATELY TO GET EVERYTHING CORRECTED.
Answer Applies to: Tennessee
Replied: 7/11/2011
    Law Office of Dennis Jay Sargent Jr, PLLC
    Law Office of Dennis Jay Sargent Jr, PLLC | Dennis J Sargent Jr.
    You should report it to the bankruptcy trustee for that case. If you do not know the trustee contact the local bankruptcy court and explain the situation and they should be able to put you in touch with the right person. Bankruptcy fraud is a serious crime and can be punishable by fines and possibly jail time. This is not something that is common practice and should be reported. The Bankruptcy Court in the Eastern District of North Carolina has information on their website on how to report bankruptcy fraud. I would suspect that most district do also.
    Answer Applies to: North Carolina
    Replied: 7/11/2011
    Indianapolis Bankruptcy Law Office of Eric C. Lewis
    Indianapolis Bankruptcy Law Office of Eric C. Lewis | Eric Lewis
    Lying in bankruptcy court is a federal court is a federal crime punishable by large fines and prison time. The United States Department of Justice and FBI investigate all bankruptcy fraud.
    Answer Applies to: Indiana
    Replied: 7/4/2013
    Law Offices of John J. Ferry, Jr.
    Law Offices of John J. Ferry, Jr. | John J. Ferry, Jr.
    Providing false information to the bankruptcy court can result in sanctions, dismissal of the case and criminal prosecution. Unless you have some relationship to the case, such as being a part owner of a business that is in bankruptcy, I doubt you have any duty to report your suspicions.
    Answer Applies to: Pennsylvania
    Replied: 7/8/2011
    Law Offices of Alexzander C. J. Adams, P.C.
    Law Offices of Alexzander C. J. Adams, P.C. | Alexzander Adams
    Yikes. To start, It is a federal crime to lie to a bankruptcy court. A handy link to the bankruptcy crime statutes is here: http://www.justice.gov/ust/eo/ust_org/ustp_manual/volume5/vol5ch08.htm. As you can see, the bankruptcy court takes this VERY seriously. Without knowing your individual situation, I can't tell you if you are in legal trouble. In regards to reporting it, be careful. If you do report it to the office of the trustee and if you are incorrect, the debtor may be able to sue you for defamation.
    Answer Applies to: Oregon
    Replied: 7/8/2011
    Colorado Legal Solutions
    Colorado Legal Solutions | Stephen Harkess
    Lying on bankruptcy paperwork or to the trustee is perjury. If you have knowledge of bankruptcy fraud, it should be reported to the U.S. Trustee who will investigate.
    Answer Applies to: Colorado
    Replied: 7/8/2011
    Rosenberg & Press
    Rosenberg & Press | Max L. Rosenberg
    This is a serious crime and would cause the debtor considerable trouble. If you are asking if you have a duty to "rat out" your friend the debtor, so long as you are not helping the debtor to commit a crime or furthering in the perpetuation of a crime, I do not believe you have a duty to disclose any information. However, if you benefit from the crime you may have a problem. Thanks for tuning in!
    Answer Applies to: Connecticut
    Replied: 7/8/2011
    Carballo Law Offices
    Carballo Law Offices | Tony E. Carballo
    Perjury (lying under oath) and bankruptcy fraud are serious felonies (serious crimes) that are punishable by fines and prison and can also disqualify the person from the bankruptcy discharge or the case could be dismissed. You have no legal obligation to report it if you are not personally involved but if you want to report it as a good citizen then you can address your letter to the Chapter 13 Trustee and/or the U.S. Trustee's office in the area where the case was filed. Fraud and perjury are not common but it happens occasionally. You should not report it unless you have some evidence you can present and not just speculation or a guess.
    Answer Applies to: California
    Replied: 7/7/2011
    Janet A. Lawson Bankruptcy Attorney
    Janet A. Lawson Bankruptcy Attorney | Janet Lawson
    Lying to any court is a very bad thing. You are not in trouble, as there is no requirement that you report it. If want to report it, look on the Internet for the Chapter 13 Trustee in your area. That is the person who would be the most interested.
    Answer Applies to: California
    Replied: 7/7/2011
    Law Office of Harry L Styron
    Law Office of Harry L Styron | Harry L Styron
    Fraud in the Bankruptcy court is a federal criminal offense, punishable by fine and/or imprisonment. If you have knowledge of such a fraud you should inform the Bankruptcy trustee appointed in the case. You can find out who the trustee is by calling the bankruptcy court clerk where the bankruptcy was filed.
    Answer Applies to: California
    Replied: 7/7/2011
    Law Office of Asaph Abrams
    Law Office of Asaph Abrams | Asaph Abrams
    It's a felony; the bankruptcy petition states as follows: Penalty for making a false statement or concealing property: Fine of up to $500,000 or imprisonment for up to 5 years or both. 18 U.S.C. 152 and 3571.
    Answer Applies to: California
    Replied: 7/7/2011
    Bird & VanDyke, Inc.
    Bird & VanDyke, Inc. | David VanDyke
    Intentionally lying to the bankruptcy court is a federal crime. Punishment for this type of a crime can include fine and federal prison. If you didn't lie to the court you don't have anything to worry about.
    Answer Applies to: California
    Replied: 7/7/2011
    Law Office of J. Thomas Black, P.C.
    Law Office of J. Thomas Black, P.C. | J. Thomas Black
    Yes, it can be a very serious crime to lie to a bankruptcy court. A person can be prosecuted in federal court for concealing assets, false oaths and claims, and bribery (18 United States Code Sec. 152), bankruptcy fraud (18 USC 157), destruction, alternation, or falsification of documents (18 USC 1519), concealment of assets (18 USC 3284), and the list goes on. The FBI investigates bankruptcy crimes. Penalties include 5 yrs in jail, and $250,000 fines. No you are not in trouble for having this knowledge and not reporting it. If the lies were materially false, I urge you to report it the U.S. Trustee's Office, which can make a referral to the U.S. Attorney's office. I hope bankruptcy crime is not a common crime, but even if it is, I urge you to do the right thing and report it. That will help keep it less common.
    Answer Applies to: Texas
    Replied: 7/7/2011
    Bankruptcy Law Office of Robert Weed
    Bankruptcy Law Office of Robert Weed | Robert Weed
    The people to report your concern to are called the Office of the United States Trustee.
    Answer Applies to: Virginia
    Replied: 7/4/2013
    Tucker Legal Clinic
    Tucker Legal Clinic | Samuel Tucker
    Perjury is a federal felony. Very bad crime. Not reporting the perjury is a felony itself. Here is the federal law: Whoever, having knowledge of the actual commission of a felony cognizable by a court of the United States, conceals and does not as soon as possible make known the same to some judge or other person in civil or military authority under the United States, shall be fined under this title or imprisoned not more than three years, or both.
    Answer Applies to: Mississippi
    Replied: 7/7/2011
    Ursula G. Barrios Law
    Ursula G. Barrios Law | Guillermo Machado
    Jail and massive fine if caught.
    Answer Applies to: California
    Replied: 7/11/2013
    The Schreiber Law Firm
    The Schreiber Law Firm | Jeffrey D. Schreiber
    The bankruptcy papers and the testimony before the trustee is under oath. False statements under oath in a bankruptcy case is perjury. Perjury has a potential fine of $500,000 and/or 5 years in federal prison. There is no legal obligation to provide information unless you want to do so for your own reasons or sense of morality. Only if you are asked and do not then tell the truth would you be subject to criminal prosecution.
    Answer Applies to: California
    Replied: 7/7/2011
    Ashman Law Office
    Ashman Law Office | Glen Edward Ashman
    Perjury in bankruptcy is serious and hopefully rare. The potential penalty is 5 years in jail and fines of $250,000, plus revocation of any discharge, and dismissal of the case. The person to report it to would be the Chapter 13 Trustee for that case, and, depending on how many things were false, one might also call the US Attorney in Atlanta. While we don't have all the facts, in some cases your concealment of a crime could be a crime.
    Answer Applies to: Georgia
    Replied: 7/7/2011
    Law Office of J. Scott Logan, LLC
    Law Office of J. Scott Logan, LLC | John Scott Logan
    You are not required to report inaccuracies. If you wish to do so, you may contact the Chapter 13 Trustee, Peter Fessenden at 207-725-1300. Schedules and documents are filed under penalty of perjury.
    Answer Applies to: Maine
    Replied: 7/4/2013
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