People filing bankruptcy swear under oath that they have made a full financial disclosure. Not to do so is a federal crime, as people like Lenny Dykstra have discovered. As was reported last Tuesday. a former Toms River man now living in Florida is facing charges that he hid more than $1.5 million in assets while seeking bankruptcy protection.
Bryan Young, 39, of Venice, Fla., turned himself in to FBI agents in Newark and will face two counts of bankruptcy fraud in connection with his Nov. 5, 2008 filing under Chapter 7. These charges arise out of the following allegations by federal authorities:
- he allegedly concealed more than $1.5 million in personal assets while failing to disclose four financial accounts with total balances of more than $650,000.
- he failed to disclose the purchase of about $13,000 worth of furniture and the sale of a 2003 Ford truck for about $10,000 within months of the bankruptcy filing.
- he listed no income other than from employment and the operation of a business, yet he had eBay online sales totaling more than $250,000 in the two years before the filing.
- he failed to disclose the transfer of more than $250,000 into his son’s bank account and another transfer of about $248,000 into another account he controlled.
- he failed to mention an account containing stocks, bonds and mutual funds valued at about $100,000 within months of the bankruptcy filing.
- despite claiming in his filing he owned only one vehicle, a 2006 Ford F-350, state motor vehicle records indicate he also owned a 1993 Mitsubishi GT and a 2003 Ford truck
Young faces up to five years in federal prison on each of the bankruptcy fraud charges, as well as an additional $250,000 in fines for each charge.
All of this underscores the importance of full disclosure in a bankruptcy petition. Chapter 7 can provide much needed financial relief to struggling New Jersey residents, but many, out of fear of imagined consequences, hide or "forget to mention" certain things to their attorneys. This can not only result in a loss of the fresh start, but a stint in federal prison as well! Don't do it!