Bankruptcy Fraud: How To Identifying And Wich Are Common Fraud Schemes

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Bankruptcy Fraud

<h2>Identifying Bankruptcy Fraud<&sol;h2>&NewLine;<p><strong>Bankruptcy Fraud is a form of deception and theft&comma; which unfortunately&comma; is increasing in both the US and Europe&period;<&sol;strong><&sol;p>&NewLine;<p>The bankruptcy system is designed to give an individual or a company a chance to reorganize their affairs&comma; or if reorganization is not possible&comma; to equitably distribute the non-exempt assets of the debtor among the creditors&period; This is often referred to as &OpenCurlyDoubleQuote;a fresh start”&period; The amount of money a creditor will receive in a case will range from nothing in many cases to 100 percent in a few cases&period; In every case there will be significant delays from the time a bankruptcy petition is filed until the case is closed and all creditors receive final payment&period;<&sol;p>&NewLine;<p>The bankruptcy system is based on the theory that a debtor will make full disclosure of all assets and liabilities so that the final disposition is in accordance with the requirements of the law&period; Unfortunately&comma; at times both debtors and creditors try to obtain more than they are entitled to under the Bankruptcy Code&period; There are a number of criminal statutes that prohibit this type conduct&period;<&sol;p>&NewLine;<p>Although concealing assets or making false statements in a bankruptcy proceeding make up the majority of bankruptcy frauds&comma; there are a number of fraud schemes that are more complicated or are primarily designed for reasons other than maximizing the retention of assets in bankruptcy&period; Such schemes often use the automatic stay provided by the Bankruptcy Code to conceal an earlier crime&comma; maximize profit from an ongoing fraud scheme or buy time while the perpetrator finds a way to avoid victims or leave town&period;<&sol;p>&NewLine;<p>A comprehensive list of fraud schemes will be presented in two articles&period; Within each fraud category examples of schemes will be presented&comma; with red flags to look for&comma; and courses of action to be pursued if a scheme is encountered&period; Again&comma; keep in mind that this is a list of common warning signs in a fraud scheme&period; Many of these factors may be present in situations where there is no fraud&comma; so do not jump to conclusions simply based on these warning signs&period;<&sol;p>&NewLine;<p>Identifying Bankruptcy Fraud–Part 1 covers common fraud schemes involving bankruptcies and debtor fraud&period; Identifying Bankruptcy Fraud–Part 2 will focus on creditor fraud and professional fraud&period; Included in both articles is a list of warning signs of banruptcy fraud&period;<&sol;p>&NewLine;<p><strong>Next&colon; Common Fraud Schemes Involving Bankruptcies<&sol;p>&NewLine;

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