Will I Go to Prison If I Commit Bankruptcy Fraud?

Updating a story we brought you last year, two stars of the ‘‘Real Housewives of New Jersey’’ have been sentenced to prison time over bankruptcy fraud charges. image-bankruptcy

According to the Associated Press, Teresa Giudice was sentenced earlier this month to 15 months in prison, while her husband Joe was sentenced to 41 months in prison for failing to disclose all assets during their bankruptcy proceeding.

The judge who handed down the sentencing staggered them so that one parent may be home with the couples’ children, while the other one is behind bars. Teresa will reportedly serve her sentence first, beginning in January.

‘‘I fully take responsibility for my actions. I need to learn to take responsibility for myself,’’ Teresa said in court, according to the AP. ‘‘I can’t even explain the pain that I have gone through. I am more sorry than anybody will ever know or understand.’’

Joe also faces deportation, as he came to the U.S. as an infant from Italy and allegedly did not know that he was not an American citizen.

The judge reportedly “criticized the couple for omitting numerous assets from a presentencing report, including ATVs and other vehicles and jewelry,” according to the AP.

The couple admitted that they hid assets during their bankruptcy case from creditors, because they submitted phony credit applications to get more than $5 million in mortgage and construction loans. Joe also reportedly failed to pay more than $200,000 in taxes.

In addition to serving their sentences, the couple was ordered to pay $414,000 in restitution. The couple filed for Chapter 7 bankruptcy in 2010, citing $11 million in debt.

How Can I Avoid Committing Bankruptcy Fraud?

These sentences should serve as a reminder that you need to disclose assets during your bankruptcy case. If you conceal items, trustees can easily detect dishonest information and report it to authorities for potential prosecution. This prosecution can occur at all levels, as investigators could include federal, state and local authorities.

That said: bankruptcy is a great way for people to dig out of financial holes. You should not try to defraud the legal system—it is imperative that you are honest with your attorney if you want to have a successful case.

If your financial situation is causing you problems, contact our Washington DC and Maryland bankruptcy lawyer today for a consultation. You can also visit our Facebook page, our LinkedIn page, our Google+ page or our Twitter page.

Law Firm of Kevin D. Judd Maryland and Washington DC bankruptcy attorney

Judd’s Judgment: During the 2013 fiscal year, the IRS and DOJ were involved in the prosecution of 12 people for bankruptcy fraud.

Source: http://www.boston.com/business/personal-finance/2014/10/02/real-housewives-couple-gets-prison-for-fraud/JKpztqr5NXE4NNdb7zSz2M/story.html