A Wichita car dealer who gave money to relatives before filing his bankruptcy case and lied on his bankruptcy paperwork was convicted of federal crimes this week and faces possible jail time for his fraud.
Evidence at trial proved he gave money to his wife and his brother prior to filing his bankruptcy case and he lied on his paperwork. He falsely said he had no bank accounts and he had made no transfers of money to relatives nor closed any bank accounts. He also charged $125,000 on credit cards within a year of filing the bankruptcy petition for airline tickets, jewelry and other goods.
He was convicted of making a false statement and bankruptcy fraud, both federal crimes, which could result in five years in federal prison and a fine up to $250,000 on each count.
This Kansas trial dramatically illustrates a violation of the first rule in bankruptcy: disclose, disclose, disclose. Read more about the requirement for honesty and full disclosure in a post on the Bankruptcy Law Network by my fellow blogger, Karen Oakes and “Tell the Truth, the Whole Truth and Nothing But the Truth” by Steve Otto, and “How Will the Judge Know If I Don’t Tell the Truth?” by yours truly.
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