Source: https://tomscottlaw.com/debtor-in-bankruptcy-must-disclose-all-assets-and-liabilities-or-risk-severe-penalties/
Timestamp: 2019-04-22 07:04:51+00:00

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#2 of 8 in Series — Previous Article #1: What Constitutes Property of the Estate in Chapter 13 Bankruptcy and What are the Consequences of Failing to Amend the Schedules?
Regardless of whether an asset is property of the estate or not, the debtor has a duty to disclose it. The Bankruptcy Code requires that a debtor disclose all of his or her assets at the commencement of the case. See Section 521* which states “[t]he debtor shall file … (B) unless the court orders otherwise, (i) a schedule of assets and liabilities. One Court has stated “Given the wide scope of § 541*, the debtor’s obligation to disclose all his [or her] interests at the commencement of a case is equally broad. Because full disclosure by debtors is essential to the proper functioning of the bankruptcy system, the Bankruptcy Code severely penalizes debtors who fail to disclose assets: While properly scheduled estate property that has not been administered by the trustee normally returns to the debtor when the bankruptcy court closes the case, undisclosed assets automatically remain property of the estate after the case is closed.” Chartschlaa v. Nationwide Mut. Ins.Co., 538 F.3d 116, 122 (2d Cir. 2008)** .
In other words, it is not up to the debtors, or their attorney’s, to determine if an asset has value, it is the job of the trustee. Even if the debtor believes an asset has no value, such as back rent owed by a tenant that skipped out that the debtor thinks is not collectible, it must be listed; the trustee will then determine its value.
In addition to a revocation, concealment of property can also result in criminal sanctions under 18 U.S.C. § 152*. United States v. Cherek, 734 F.2d 1248 (7th Cir.1984), cert. denied, 471 U.S. 1014, 105 S.Ct. 2016, 85 L.Ed.2d 299 (1985). “Even if the asset is not ultimately determined to be property of the estate under the technical rules of the Federal Bankruptcy Code, Section 152 properly imposes sanctions on those who preempt a court’s determination by failing to report the asset.” Id. at 1254. Accord, United States v. Grant, 971 F.2d 799 (1st Cir.1992); United States v. Beard, 913 F.2d 193 (5th Cir. 1990); United States v. Jackson, 836 F.2d 324 (7th Cir.1987). Most importantly, your client may be precluded under the doctrine of judicial estoppel from bringing a cause of action that was not listed, valued and potentially exempted in the schedules.
This point is pretty self-explanatory; If the court determines that the debtor has acted fraudulently by trying to hide any assets, the bankruptcy can be denied and criminal charges can be filed.

References: § 541
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 § 152
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