{"id":286959,"date":"2021-01-11T15:27:58","date_gmt":"2021-01-11T20:27:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-law\/bankruptcy\/what-is-bankruptcy\/bankruptcy-fraud.html"},"modified":"2026-06-09T11:52:30","modified_gmt":"2026-06-09T16:52:30","slug":"bankruptcy-fraud","status":"publish","type":"page","link":"https:\/\/www.findlaw.com\/bankruptcy\/what-is-bankruptcy\/bankruptcy-fraud.html","title":{"rendered":"Bankruptcy Fraud: Legal Definition, Examples, and Penalties"},"content":{"rendered":"\n
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Bankruptcy Fraud: Legal Definition, Examples, and Penalties<\/h1>\n\n
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\n By Christie Nicholson, J.D.<\/a> | Legally reviewed by Laura Temme, Esq.<\/a>\n | Last updated\n
\n \n <\/i>\n Legally Reviewed\n <\/summary>\n\n
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This article has been written and reviewed for legal accuracy, clarity, and style by FindLaw\u2019s team of legal writers and attorneys<\/a> and in accordance with our editorial standards<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n\n

\n \n <\/i>\n Fact-Checked\n <\/summary>\n\n
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The last updated date refers to the last time this article was reviewed by FindLaw or one of our contributing authors<\/a>. We make every effort to keep our articles updated. For information regarding a specific legal issue affecting you, please contact an attorney in your area<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n<\/section>\n\n\n

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Key Takeaways<\/h2>\n

According to federal law<\/span>, bankruptcy fraud<\/span> is the intentional deception or concealment of assets<\/span>, income, or information during bankruptcy proceedings<\/span>. Common examples of bankruptcy fraud<\/span> include hiding assets<\/span>, making false statements<\/span> under oath, or transferring property to avoid creditors. Federal penalties include up to five years in prison and $250,000 in fines. Courts distinguish between bankruptcy fraud<\/span> (intentional) and honest mistakes (correctable).<\/p>\n\n <\/div>\n <\/div>\n<\/div>\n\n\n

Under federal law<\/span>, a person commits bankruptcy fraud<\/span> when they take any action in a bankruptcy case<\/span> that doesn’t accurately represent the facts and causes harm to another. For the government to convict you of this crime, it must prove that you intentionally did something to gain an advantage during the bankruptcy process<\/span><\/a>.<\/p>\n

In this article, we’ll explain what bankruptcy fraud<\/span> is and what to do if the government charges you with this crime. We will also provide examples of bankruptcy fraud<\/span> and what happens if the state convicts you of this serious offense.<\/p>\n

Bankruptcy fraud<\/span> is a serious white-collar crime<\/span><\/a>. If you\u2019re facing charges or think you\u2019re under investigation, consider contacting a criminal defense lawyer<\/a>. If you\u2019re already working with a bankruptcy attorney<\/span><\/a>, they may also be able to assist you with criminal charges<\/span> if they have defense experience with bankruptcy <\/span>fraud<\/span> cases<\/span>.<\/p>\n

Legal Definition of Bankruptcy Fraud<\/span><\/h2>\n

Whether you handle your bankruptcy case<\/span> yourself or have a bankruptcy attorney<\/span>, it’s important that you understand how the government defines bankruptcy fraud<\/span>. A conviction for this offense can result in a lengthy prison sentence and hefty fines.<\/p>\n

You can find the statutory definition of bankruptcy fraud<\/span> at 18 U.S.C<\/span>. \u00a7 152<\/a>. This federal law<\/span> governs fraud in bankruptcy proceedings<\/span>. Under this law, a person is guilty of bankruptcy fraud<\/span> when they engage in the following:<\/p>\n