• A debtor could be charged for bankruptcy fraud in Illinois.crime examination (investigation) image by stassad from Fotolia.com
  
  The federal government provides help to individual debtors who have financial problems and cannot keep current on their bills. An Illinois debtor may either file for Chapter 7 or Chapter 13 bankruptcy. When completing a bankruptcy petition, a debtor must disclose all information about her financial situation. Otherwise, the debtor could face criminal fraud charges if the authorities discover the fraud within a certain time frame.
  
  

Bankruptcy Fraud

• According to the U.S. Department of Justice, "The criminal provisions relating to bankruptcy fraud were enacted to preserve honest administration in bankruptcy proceedings and to ensure the distribution to creditors of as large a portion of the bankrupt's estate as possible." If a debtor commits bankruptcy fraud, he has committed a federal crime. An Illinois resident commits bankruptcy fraud when he conceals property belonging to the estate of the debtor; makes false oaths or accounts in relation to any case under the federal Bankruptcy Code; makes a false declaration, certificate, verification or statement under penalty of perjury as permitted under Section 1746 of Title 28 or in relation to any case under the federal Bankruptcy Code; makes false claims against the estate of a debtor; fraudulently receives property from a debtor; participates in bribery and extortion in connection with a bankruptcy case; transfers or conceals property in contemplation of a bankruptcy case; conceals or destroys documents relating to the property or affairs of a debtor; or withholds documents from the administrators of a case under the federal Bankruptcy Code. The law does not limit bankruptcy fraud to the acts or omissions of the debtor.
  
  

Discharge

• In a Chapter 7 bankruptcy case, an Illinois debtor files her bankruptcy petition and forms. A bankruptcy trustee reviews her petition and forms. If the debtor has any property to be sold, the trustee sells that property and uses the proceeds to pay creditors. If the debtor has not listed any property that can be sold to pay creditors on her bankruptcy forms, the trustee will file a report of no assets with the bankruptcy court. Afterward, the debtor receives a discharge of her debts. In a Chapter 13 case, after a debtor has filed her bankruptcy petition and forms and a proposed debt repayment plan, the court will need to approve the plan. After the court approves the plan, the debtor makes monthly plan payments to the bankruptcy trustee for a period of three or five years. After making all plan payments, the debtor receives a discharge.
  
  

Statute of Limitations

• In Illinois, the statute of limitations for bankruptcy fraud begins to run after a discharge of debts has been granted to a debtor. In some cases, a debtor may be denied a discharge of debts, and in such a case, the statute of limitations begins to run after the bankruptcy court denies the discharge. The statute of limitations on Illinois bankruptcy fraud runs for five years after the date of the granting or denial of a discharge.