Bankruptcy Chapter 13 Fraud
The number of people filing for bankruptcy was increasing at an alarming rate in the United States just about a year ago. However, some reports claim that they have come down after the various tax breaks and plans made by the Obama government. |
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Chapter 13 bankruptcy happens to be one of the most common types of bankruptcy filed for because it has several advantages for the individual and as well as the companies. It allows retaining your assets without losing them to debt and also organizes a payment plan. It keeps the creditors at bay and the collection agencies cannot bother you with their annoying calls.
However, bankruptcy Chapter 13 is also being widely misused. People are finding refuge in it for various reasons. One of the most frequently committed frauds under this plan is concealing assets. Several people file for bankruptcy and make fraudulent claims that they hold no assets. They w ill transfer it on someone else’s name and it becomes no traceable.
Some other types of fraud that companies do are they set up a company so that it fails and then file for bankruptcy. It is called bust out. In the mean time they take several loans and obtain goods or merchandise.
A bleed out is another kind of fraud committed by the insiders of a corporate firm over a period of time. Some investors follow the pyramid scheme and promise the investors an exorbitant amount of return. Then they file for bankruptcy after building capital over a period of time.
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