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West Palm Beach Bankruptcy & Business Attorneys > > Bankruptcy Attorneys > How Will A Bankruptcy Trustee Know If You’re Lying?

How Will A Bankruptcy Trustee Know If You’re Lying?

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You’re filling out your bankruptcy paperwork, and your bankruptcy attorney told you how important it is to be truthful. But a part of you is wondering, if you’re not entirely truthful, who will know the difference? How will the bankruptcy court or trustee ever know what the real truth is?

There are a lot of ways that a bankruptcy trustee finds things that people conceal, or else, that they “forget” to put on their bankruptcy schedules. Here are the ways that a bankruptcy trustee often finds out that someone isn’t completely telling the truth, or that a bankruptcy filer hasn’t given a full and complete financial picture.

Your 341 Meeting – At your 341 meeting, the trustee will ask you questions about your finances and the paperwork that you submitted. The 341 is not meant to trick you, the questions are easy, and most people sail through it with no problem at all.

But as you know from life, even easy questions become difficult when you’re hiding or lying about something. An accidental slip about a bank account, or a purchase, or some income you never disclosed on your paperwork slips out when answering routine questions.

Imagine a trustee asking how you afford your bills—a simple question–and you mention “the inheritance helps pay some bills,” but you never disclosed getting any inheritance. Or, saying that work pays for some of your gas expenses, even though you’ve only said you are a schoolteacher on your paperwork-a position that doesn’t pay for gas expenses.

Your Bank Account Records – Often, trustees find things in bank account records that don’t seem to make sense. For example, the trustee may find an expenditure for a business tool, even though you never said you owned a business. The trustee may find a transfer into your account from another account—even though you only disclosed one bank account. Your records may show dividend income, even though you ever disclosed owning stocks.

The trustee will look for any abnormality in your records, and that abnormality doesn’t have to be a million dollar transfer or show huge amounts of money going in or out of your account.

Other People – It has happened that a scorned ex-spouse, or an ex-buddy that you owe money to, decides to contact the bankruptcy trustee, and tell him or her about your “real” financial life. Sure, you may have no enemies. None that you know of, at least. Your spouses, business associates, or others often know an awful lot about you, and will tell all to a trustee if they are upset.

Things Don’t Match – If you drive a luxury car, went on 3 vacations last year, and run your own business, a trustee may look a little closer at your finances. That’s not to say there’s anything inherently wrong with any of this. But when your stated lifestyle doesn’t match your actual lifestyle, trustees will start to look deeper into your finances.

Call the West Palm Beach bankruptcy lawyers at Kelley Fulton Kaplan & Eller at 561-264-6850 for help filing for bankruptcy the right way.

Resource:

uscourts.gov/forms/bankruptcy-forms

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