What Can Happen If I Deliberately Underestimate the Value of a Car in My Chapter 7 Bankruptcy?
- Any paperwork that you file with the bankruptcy court must be signed by you "under penalty of perjury." This means you verify that the information is accurate and, if not, you agree you will face legal repercussions. Additionally, when you attend your creditors meeting you will also have to verify under oath that all information you have submitted to the court is accurate to the best of your knowledge.
- The first and most immediate effect of deliberately underestimating the value of your car will be a dismissal of your bankruptcy action. The bankruptcy court will dismiss your bankruptcy petition as soon as the fraud is uncovered.
- In addition to having your bankruptcy case thrown out, you could face even more significant legal problems including being charged with crimes for committing perjury or fraud on the bankruptcy court. If you are convicted of either of those crimes, you could be ordered to pay restitution, which is an order to pay money damages to the court, and you could also face prison time.
- The U.S. Trustees Office is a branch of the U.S. Department of Justice, and one of the purposes of the Trustees Office is to find and prosecute perjury and fraud in bankruptcy courts. This can happen in two ways. First, the trustee assigned to your particular case may uncover the fact that you deliberately underestimated the value of your car. Additionally, the Trustees Office pays independent accountants to randomly audit bankruptcy paperwork and your underestimation may be uncovered in one of those random audits.