Submitted by Rachel R on Fri, 04/08/2016 - 9:28am
Burlington man faces jail time over bankruptcy fraud
Image Source: Flickr User teofilo
Many people don’t think twice about a small lie on a loan application or to a friend about their finances but fibbing on a North Carolina bankruptcy petition is in a whole different league of lies. Bankruptcy laws are federal statutes and must always be taken seriously. If you’re dishonest in Chapter 7 or Chapter 13 petition, you can land time in jail like Burlington resident Faiger Blackwell.
Jail sentence handed down in March
Faiger Blackwell was slapped with a two-year prison term for bankruptcy and tax fraud owing to misleading the bankruptcy court. Blackwell was accused of hiding rental income during a bankruptcy case he filed to cope with more than $300k in back taxes plus $1 million in commercial debt he had accumulated for himself and a funeral home business.
The secret rental income was what landed Blackwell in trouble with the bankruptcy court. The tax fraud accusations were tied to a second bank account he opened up in another company name to try and circumvent an IRS levy on his income due to the back taxes. Now he’ll serve two years in jail (perhaps less) plus three years supervised release and must repay more than $400k in restitution.
How to avoid trouble from the bankruptcy court
In a word, transparency is the approach to take when it comes to bankruptcy. Most people have some aspects of their finances – whether it’s debt, income, or spending habits – that they keep secret. Some consumers hide credit card or tax debts from their partners. Still others spend secretly and hide the proof of their excesses. Very few people are completely honest about their finances across the board.
But in bankruptcy court and in bankruptcy petitions, you must come 100% clean about your income, assets and debt. That’s the only way to avoid fraud accusations, possible jail time, and repayment of any benefit you received to which you were not entitled. Your bankruptcy attorney is there to advise and protect you, but they cannot do so if you are not honest with them.
Prepare for total honesty with your attorney and Trustee
When you come in for an initial North Carolina bankruptcy consultation, be sure to bring the following documents with you:
Documentation is just part of the story
When talking to your bankruptcy attorney, be completely honest when you assess your financial conditions. There is no reason to be overly optimistic about your financial prospects. If you’re hoping for a significant raise but have no clue about the amount, don’t puff up based on your hopes.
Stick to the facts so your attorney can work with the reality of your current financial situation when they prepare your petition. The path to the best results in your bankruptcy filing is giving your attorney all the information they need to fight for the best outcome for you.
To find out more about North Carolina bankruptcy, contact the Law Offices of John T. Orcutt for a free bankruptcy consultation at one our convenient locations in Raleigh, Durham, Fayetteville, Wilson, Greensboro, Garner or Wilmington. Call +1-833-627-0115 now to get the financial peace of mind you deserve.
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