For most people filing personal and business bankruptcy, a general court proceeding is all they need to discharge years of damaging debt and begin rebuilding their credit. In some cases, though, debt is not so easily excused, especially if the filer is accused of criminal financial acts. One Illinois man is facing a bleak situation after his bankruptcy was effectively negated to promote creditor protection in his case.
Authorities report that the well-known owner of the now-defunct THR & Associates will remain liable for many of his debts because his bankruptcy petition was denied. The man was accused of attempting to hide millions of dollars in cash and personal property holdings. The unfortunate outcome of this case underscores the need for total honesty during a bankruptcy proceeding. It is unlikely that clients will be able to deceive bankruptcy courts and trustees about their assets for long.
Now, the man, who had owned a road-show company that purchased precious items such as jewelry, antiques and collectibles, will be held liable for hundreds of millions of dollars in debts that had been listed in his September 2012 bankruptcy petitions. The bankruptcy paperwork was rejected by a judge after it was determined that the man attempted to hide assets by destroying them, transferring them to family members and even moving some of the property to another location in Texas.
Experts say that denial of a bankruptcy petition is unusual, though it is possible in cases that involve deception such as this. Default judgments are generally only rendered when debtors fail to meet deadlines or provide certain information. In this case, the man admitted to allegations of misconduct that were brought by the trustees.
Instead of taking such bankruptcy matters into their own hands, clients should consult qualified bankruptcy attorneys to help them resolve their consumer debt. These attorneys can help avoid wage garnishment and other unpleasant consequences by making sure that the bankruptcy proceeding is done right the first time.
Source: www.sj-r.com, "Bankruptcy judge denies debt relief for Parsons, THR" Tim Landis, Nov. 29, 2013