William D. Weber / March 1, 2014
As part of the bankruptcy process, debtors are required to disclose all of their assets, creditors, income, expenses and financial history. The filing of accurate financial disclosures has always been very important. These disclosures are made under penalty of perjury. The filing of inaccurate disclosures can result in criminal prosecution for bankruptcy fraud and filing false statements under oath. A conviction can result in a five year federal prison sentence and a $250,000 fine. Weber Law Firm takes the bankruptcy disclosure process very seriously. We take all possible precautions to ensure that debtor schedules are meticulously true and accurate.
In 2005, Congress passed the Bankruptcy Abuse Prevention & Consumer Protection Act. This law made radical changes to the bankruptcy system. One such change was a requirement that the U.S. Trustee’s office conduct random audits of bankruptcy disclosures to determine if they are accurate. Starting in 2007, one out of every 250 bankruptcy cases filed in each district were randomly flagged for an accuracy audit. In 2008, the number of audits was reduced to one out of every 1,000 cases. In 2011, the rate was again reduced, this time to one out of every 1,700 cases. A Los Angeles bail bonds agent will be an asset. Audits were suspended completely during March of 2013 due to budget cutbacks.
The U.S. Trustee’s office announced on February 21 in an article posted on its website that audits will resume beginning in March 2014. The article does not specify the audit rate that will apply when the audits resume.