In the vast majority of bankruptcy cases, debtors have no problem disclosing all of their assets to a bankruptcy trustee. Occasionally, we hear concerns about the possibility of “losing” an asset to a bankruptcy trustee which sometimes prompts the question: do I have to disclose this asset? Bankruptcy schedules are signed under penalty of perjury affirming that all of your assets are disclosed on the schedules. No, you may not pick and choose which assets to disclose. You must disclose all assets, wherever they exist, in the world.
However, what happens when a debtor intentionally conceals ownership of an asset? A debtor who intentionally conceals assets will likely lose their discharge under Section 727(a)(2) or 1328(e)(1) and could be prosecuted for bankruptcy fraud. In short, any debtor who intentionally conceals assets in bankruptcy will likely lose the discharge they sought and get prosecuted for committing a crime.
Honest debtors receive discharges in bankruptcy, dishonest debtors do not. If you refuse to disclose all your assets, debts, and financial affairs, do not file bankruptcy. It is that simple. I am happy to report this does not happen often. Yes, debtors occasionally miss assets but it was not an intentional omission. Debtor simply forgot about owning the asset in question. The asset gets disclosed, trustee is able to administer the asset, and creditors are not harmed. However, in the situation where debtor intentionally conceals the asset, creditors are and the judicial system are harmed.
If you are thinking about filing bankruptcy, don’t file bankruptcy unless you are willing to fully disclose all your assets, debts, and financial affairs. Do anything less is failing your oath to sign the schedules under penalty of perjury all assets, debts, and financial affairs are fully disclosed.
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