trustees will dig our past during/after 341

[seafresh]

Oh I forgot one more thing from my 341 meeting, they will dig up anything that relates to your name... your house deeds, business names under your home address.

There was one lady before me who just got herself caught off guard by trustee lawyer asking about if she knew why there was 3 business using her home address and plus relationships of people who started the business. Then lawyer ask about another checking ending xxxx(which show money being transfer from her acct to that acct).

I got call from my lawyer that trustee lawyer pull up deed that had my name to.. which my ex refinanced...

So, make sure you have anwsers..

good luck

seafres

[SinkingFast]

I'm beginning to wonder if the whole BK system is under some sort of pressure to "Produce".

We have a female friend who had to file as the result of a nasty divorce.

Her Trustee, a woman, was very nasty. GF's 341 lasted a half an hour. The Trustee was digging into what GF may get in the way of property settlement from her Divorce.

GF and her STBX had already agreed, he'd get the house and she'd get a portion of his 401K acct. There are case Decisions where retirement monies split as the result of Divorce Settlement are protected/Exempt.

The Trustee is even trying to go after 8 Waterford Crystal Glasses, worth less than $500 total, and a framed print worth about $500.

Talk about nit picky!

[jp2861]

Sounds like that's a trustee that may be on a power trip.

[JollyGG]

Yea they do pull up that stuff. We had our two cars listed on our petition as well as our tent camper. All fell under our state exemptions and we planned to keep all of them. All three were licenced and had plates.

Our trustee brought up a licencensed trailer she didn't see on our schedule. Turned out it was the camper and we were already aware that the licence calls it a trailer (something we had wondered about in the past). We said "oh, thats the camper" pointed to where it was in our schedule and everyone moved on.

They will dig, but as long as you are honest you have nothing to worry about. As I said all we had to do was clerify where we had listed that particular asset since it looked like something different in her records. Problem solved.

[freshstart06]

Out here they use some kind of automated system (not sure of the name, I forgot) but when they input your name and ssn in this system it shoots out everything that is out there about you (if it is avaiable) Then it shoots out red flags and codes to the trustee and clerks to look further into the info that was found. I have a Mortgage Business that is in my name but not questioned because it had nothing tied to it, no bank accounts, no credit, nothing. I had to get an LLC to run my Mortgage business when I was 1099 but now I am W2. However, I was scared that I would have to prove all this but I guess the BK computer system was satisfied with the info they found or my tax info was proof enough.

yeah be careful... I noticed on pacer that about half the cases since I filed has gotten dismissed, I think they tighten up or something. I just thank God it is all over for us :-)

[B12]

I have all kinds of crazy large deposits and withdrawals in my checking accts. I would pull thousands off of my home equity line and then pay it back.

I think I am in for a long ride.

But it is all legit, so hopefully they will just ask a million questions that I can answer.

What do they dismiss for? Fraud? If I can justify everything,
do I have anything else to worry about except fraud?

I also have bought and sold numerous houses in past 5 years, again all money spent legit for living expenses, business, etc.

Oh, I think I am in for a major roller coaster ride. I will probably have to give my lawyer my entire file cabinet.

[lrprn]

What do they dismiss for? Fraud? If I can justify everything, do I have anything else to worry about except fraud?.

Take a look at this very interesting article, "Identifying Bankruptcy Fraud" - http://www.crfonline.org/orc/pdf/ref11.pdf

According to the authors, here are the major bk fraud triggers :

Bankruptcy Fraud Warning Signs
1. Concealment of assets
2. Serial bankruptcy cases
3. Failure to keep usual business records
4. Incomplete or missing books and records
5. Conduct well outside ordinary business or industry standards and practices
6. Unusual depletion of assets shortly before the bankruptcy filing
7. Recent departure of debtor's officers, directors or general partners
8. Unanswered questions or incomplete information on debtor’s schedules and statement of financial affairs
9. Frequent amendments to schedules, statements of financial affairs and monthly operating reports
10. Inconsistencies among recent financial statements, tax returns and debtor's schedules and statements of financial affairs
11. Absence of knowledgeable officers to testify at the Section 345 meeting
12. Inability to contact principals of debtor at debtor’s stated location
14. Frequent dealings in cash rather than recorded transactions
15. Sudden depletion of inventory post-petition without plausible explanation
16. Inflated salaries, payments of bonuses or cash withdrawals byofficers, directors, shareholders or other insiders
17. Transfer of property to insiders, shareholders and relatives shortly before bankruptcy
18. Payoff of loans to directors, officers, shareholders, relatives or other insiders shortly before filing.
19. Transactions with non-debtor subsidiaries, parent companies or affiliated corporations owned by the same or related persons or entity
20. A history of prior litigation or post-petition litigation involving breech of contracts, fraud misrepresentations, etc
21. Complicated corporate structures and relationships.
22. Creditor confusion concerning corporate structure.
23. Fire, theft or loss prior to or after filing.
24. Failure to pay withholding and sales tax.
25. Startup of a similar business near the time of bankruptcy filing.

[ssdsco]

I have all kinds of crazy large deposits and withdrawals in my checking accts. I would pull thousands off of my home equity line and then pay it back.

I think I am in for a long ride.

But it is all legit, so hopefully they will just ask a million questions that I can answer.

What do they dismiss for? Fraud? If I can justify everything,
do I have anything else to worry about except fraud?

I also have bought and sold numerous houses in past 5 years, again all money spent legit for living expenses, business, etc.

Oh, I think I am in for a major roller coaster ride. I will probably have to give my lawyer my entire file cabinet.

I'm in the same boat. 6 houses in the last ten years. moved money around 3 linked checking accounts and a linked large line of credit, sold a vehicle to my son, lot's of gifts (support for parents and adult children) over $200 while insolvent, cashed stock options, 401k loans and then repaid.

I'm in the process of documenting every transaction over $500 for the past couple of years where I can get statements. Trying to find all the house closing statements for the past 10 years to prove equity went from one house to the next and finally up in smoke in my home going to foreclosure.

My attorney took me through the statement of financial affairs and explained the look back periods in the forms versus how far back the trustee could go if he’s triggered by activity in any of the questions. The trustee can go back 5-10 years in some areas.

I’m expecting the trustee to hire a whole law firm to deal with me. Glad I’m experienced being wired up to a video camera and microphone 5-6 hours at a time giving depositions trying to say nothing but yes, no or my favorite….I don‘t recall.

I haven’t done anything illegal , no intentional fraud but definitely have things that will be considered fraud.

I’m judgment proof so I’m now considering waiting a year to file just so I don’t have to list so much in the statement of financial affairs, it looks more like the average filer and hopefully I’ll have a lot less explaining to do and $$$ to pay from my “exempt“ 401k.

Hopefully my attorney/trustee is just getting me prepared for the worst case.

I love my new cash (no credit anymore) budget tracked via a couple of simple spreadsheets. One stop shopping for clothes and groceries. My life is so much simpler. I just need to get through BK.

[MomIcantFindmy]

I love my new cash budget tracked via a couple of simple spreadsheets. One stop shopping for clothes and groceries. My life is so much simpler. I just need to get through BK.

Me too.....I love a cash only system...it keeps me straight but I think I am going to be sorry I did it that way.

[busbis]

do the trustees typically go back and research on both 13 & 7? Just curious, we plan on filing this month a 13 but were going to be paying back 100% and surrendering 2 properties that we can't afford. Can they force us not to file a 13 and tell us to pretty much deal with it on our on?

[ssdsco]

Me too.....I love a cash only system...it keeps me straight but I think I am going to be sorry I did it that way.

Oops I should have been clearer. When I say cash budget I mean no more use of credit. I actually use my banks bill payer service and a debit card tied to my checking account. I make very few purchases with cash. Generally the stuff under $5. I keep all my debit card receipts. Getting ready for some quality time with the trustee.

[lrprn]

do the trustees typically go back and research on both 13 & 7?

Trustees go back and research on both Ch 7 and Ch 13 cases when there's a reason to do so. It's not routine.

Can they force us not to file a 13 and tell us to pretty much deal with it on our on?

Only if the trustee discovers and can prove to the court that you committed bk fraud. It's called involuntary dismissal and frankly, it's very rare.

Usually what happens is that the trustee will object to your Ch 13 plan and your lawyer will either challenge the trustee's objections if that's warranted or file an amended plan to remove the objections. It's not an "all or none" situation - there's plenty of options short of outright dismissal of your case.

Unless your lawyer is telling you to worry, then do you best to not let the pre-discharge jitters get to you, busbis.

[B12]

Thanks Irprn, good info. Thankfully none of those apply to me.