Lying to the court can see your discharge revoked
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Generally, getting the discharge document in your bankruptcy case means everything is final, your debt has been dealt with, and you can move on with your life. However, in some cases, your discharge can be revoked by the court and you can end up in worse shape than when you started. Here’s what you need to know about discharge revocation.
Dishonesty Can Cause You to Lose Your Debt Discharge
There is really only one thing that would cause the North Carolina bankruptcy courts to take back your debt discharge, and that is dishonesty. If you lie on your bankruptcy forms and the lies are caught while still in the bankruptcy process, you can be denied your bankruptcy discharge.
But even if your lies aren’t initially detected and you receive a discharge, if fraud is discovered after the fact, your discharge can be taken back at any time. This is called a “revocation of discharge” and is a very serious matter.
Federal Law Demands a Revocation of Discharge for Dishonesty in Bankruptcy
In some cases, the Trustee assigned to the case can ask for a review—and in one recent case that made headlines, it was the judge that caused the review. That’s what happened to Dance Moms’ Abby Lee Miller when her bankruptcy judge saw her TV show and called her case back up for review.
Your debt discharge can be revoked if: (1) the discharge was due to your fraud (2) you acquired property or other assets, or you were entitled to and failed to report this to the court (3) you made substantial misstatements on your bankruptcy forms or didn’t make required financial documents available.
How Big of a Lie is Big Enough to Cause Discharge Revocation?
Typically, a small, unintentional error on your forms won’t cause your bankruptcy to be reviewed and your discharge revoked. Even if you lied intentionally, but it was not a significant lie that impacted the entire case, you might not be subject to revocation.
It’s never a good idea to lie to the bankruptcy court—any lie of any size. However, the dishonesty generally has to be pervasive enough to affect the whole bankruptcy case. Examples of this are lying about an inheritance you’re due, signing property over to someone else, or hiding assets.
Who Can Expose Your Lie and Cause Your Bankruptcy to be Revoked?
Anyone that is an “interested party” to the bankruptcy case can spill your secrets to the bankruptcy court and cause your case to be reviewed and your discharge potentially revoked.
This includes the trustee, judge, attorney, your creditors, the court itself (i.e. the judge), your spouse, ex-spouse, or partner or ex-partner. For instance, if you lie and your ex-husband knows about it, he could rat you out to the court and cause your bankruptcy discharge to be revoked.
Honesty is the Best Policy
It’s never a good idea to lie to any court, whether it’s traffic court, divorce court, or the bankruptcy court. If you’re caught, you could end up in hot water. With bankruptcy law in particular, the law is there to protect you—and it doesn’t pay to try and take advantage.
To find out more about the debt relieving benefits of Greensboro bankruptcy, contact the Law Offices of John T. Orcutt today. Call +1-919-646-2654 now for a free consultation at one of our convenient locations in Raleigh, Durham, Fayetteville, Wilson, Greensboro, Garner or Wilmington.