Lying in a bankruptcy proceeding can land you in hot water; just ask Lenny Dykstra! But can it get you deported? The federal appeals court's Third Circuit considered that very question in the case of Singh v. Attorney General of the United States in which a Jamaican immigrant had plead guilty to making false statements in connection with the chapter 11 bankruptcy of a company he founded, Raeback Corp.
Mr. Singh had concealed $54,000 in corporate receivables from the Port Authority of NY and NJ, in an attempt to pocket them himself. As a result of the plea, Singh received a 10-month prison sentence and was ordered to pay restitution by having the $54,000 held by the Port Authority transferred to Raeback’s bankruptcy trustee for distribution to creditors.
The Department of Homeland Security then brought a proceeding to have Singh removed from the country, arguing that his conviction involved a “loss or intended loss” to a victim exceeding $10,000, thus making him removable as an aggravated felon under 8 U.S.C. § 1101(a)(43)(M)(i). This was successful. The Board of Immigration Appeals then upheld the removal order, finding Singh’s agreement to pay restitution provided clear and convincing evidence that his offense caused a loss to the trustee in excess of $10,000.
However, the 3rd Circuit said the loss in this case was not “actual” because at no time did Singh possess the funds at issue. Instead, the funds were held by the Port Authority and later turned over to the trustee. What is interesting to note here is that Singh was born in Jamaica, was a lawful permanent resident of the United States since 1975, and was married to a U.S. citizen, with three children. Despite that, he could still be thrown out!
The important thing here is that lying in a bankruptcy proceeding can have far reaching consequences. It is considered a crime, and can result in fines and jail time. In addition, as this case clearly points out, it can also have the potential consequence of your being kicked out of the country!