Hafemeyer Law

Bankruptcy: Honesty is the Best Policy

The old adage “Honesty is the best policy” still rings true in many areas of life – and especially when preparing to file for bankruptcy.  Often, attorneys ask a lot of questions and require clients to supply them with a large amount of information where preparing a bankruptcy filing. Many clients question why there is a need to provide such detailed information. The
recent story of a high profile celebrity couple shows the importance of being completely honest.

Real Housewife star Teresa Giudice and her husband were arraigned on criminal charges relating to a bankruptcy filing along with several other charges. In this case, the stars’ celebrity status was likely not an asset. Many theorize that the spotlight may have made the couple a target for criminal charges.

According to news sources, the couple filed for bankruptcy in 2009, but withdrew their petition in 2011. The IRS and banks have studied the couple’s tax filings, which became public through the bankruptcy filing, and found that the couple failed to report income they received from the show in 2009 on their tax return. If convicted, the couple could face significant fines and/or prison time.

Situations like these reiterate how important it is to be completely open and honest on a bankruptcy filing.  Filing for bankruptcy is a request for the court to relieve a debtor from a poor financial condition.  This discharge is a way for the debtor to receive a pardon from their debts to make a fresh start.

So when your attorney asks for a myriad of information in a bankruptcy filing, it is best to not to be evasive in answering questions and provide your attorney with all of the information that they request. They have your best interest in mind and want to ensure that the bankruptcy filing is not only accurate but allows for a full discharge of all possible indebtedness.

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