Bankruptcy, therefore, represents a solution to problems that result from either misfortune or mistake. When the use of bankruptcy becomes part of the problem, however, that use loses its legitimacy and becomes a vehicle for substantial abuse. The key distinction is whether a debtor uses bankruptcy to solve unintended difficulties, or as part of a broader scheme or device to avoid personal responsibility for one's conduct. Every human is capable of making a mistake. Gambling and substance abuse are examples of personal weaknesses that can have enormously adverse consequences for one's financial well-being.
Some individuals are prone to over-spending.
Others make investment decisions which, in hindsight, are ill-advised. Such faults and failures may cause the creation of substantial indebtedness. So long as insolvency is an unintended result of the debtor's conduct, bankruptcy offers an opportunity to overcome the problems of one's past. In this context, the bankruptcy process contemplates that astute counsel may provide pre-bankruptcy planning, to assist debtors to maximize the benefits of the Bankruptcy Code. But when bankruptcy represents a mere step in a process that the debtor has designed to avoid obligations, the filing of a bankruptcy petition loses the character of a solution, and instead becomes part of the underlying problem.