NYC Bankruptcy Fraud Lawyer

Federal Bankruptcy Fraud Lawyer in New York City

For those individuals and businesses who find themselves in dire financial straits, the federal bankruptcy laws offer an opportunity to gain a “fresh start” by either reducing or eliminating their obligations to creditors. A bankruptcy filing will put a stay on collection and foreclosure efforts by unpaid creditors. However, the proper functioning of such a system is wholly dependent upon the completeness and truthfulness of the declarations and representations made and actions taken by the party seeking bankruptcy protection. When that party is believed to have knowingly made false statements or representations in connection with their petitions in bankruptcy in order to hide income, assets, or overstate liabilities, or of transferring undisclosed property to a third party so as to remove it from the asset pool, they may be investigated and charged with the commission of federal bankruptcy fraud. So too may a creditor be charged with bankruptcy fraud if he or she makes a false claim against a debtor or assists in the transfer of undisclosed assets by a debtor outside of the court proceedings. The U.S. Department of Justice has an entire unit assigned to flag and probe suspected instances of bankruptcy fraud and the FBI also investigates fraud committed in the course of bankruptcy proceedings.

Whether you are or were the debtor or a creditor in bankruptcy, if you have reason to believe there may be a federal investigation of bankruptcy fraud being undertaken, you will want to consult with a top NYC bankruptcy fraud lawyer to ensure that your rights are protected and a defense strategy is formulated. Bankruptcy fraud charges are no joke. At the very least, they could cost you five years of your life in federal prison. Fred Sosinsky has represented individuals and corporate entities under federal bankruptcy fraud probes and other white collar crimes over the course of three decades. He has worked to avoid his clients’ arrests, convictions, and prison sentences in cases involving bankruptcy fraud.

As is the case with many other federal crimes, a person charged with bankruptcy fraud in New York may also face charges of other related financial offenses. It is quite common to see mail or wire fraud, credit card fraud, bank fraud, tax evasion, and other such crimes in an indictment that charges bankruptcy fraud. If convicted of these separate crimes, it is possible that a federal court could impose consecutive sentences upon a criminal defendant.

What is Bankruptcy Fraud?

Under federal law, a person commits bankruptcy fraud when they devise a scheme or artifice to defraud, and in order to execute or conceal that scheme or artifice to defraud, they file a fraudulent bankruptcy petition, or a petition containing a fraudulent document or they make a false or fraudulent representation, claim or promise in connection with a bankruptcy proceeding. Bankruptcy fraud may also be charged when a person either prior to or during the course of a bankruptcy proceeding knowingly and fraudulently conceals assets, makes a false oath, declaration or statement fraudulently transfers or conceals property or documents, or withholds documents from the trustee. A creditor may be charged with bankruptcy fraud in New York when they fraudulently receive assets or payments of the creditor outside of the bankruptcy process or when they fail properly to account for payments made to them in connection with the proceeding.

In order to prove that a person acted knowingly, the government needs only to prove that they did so deliberately and not as a result of a mistake or neglect. But the law does not require that the accused have intended to violate the law when engaging in the act. What is required is that they knowingly engage in conduct which in fact violates the law. To prove that a person acted fraudulently, what must be shown is that the accused intended to deceive the other parties and the court.

Sentencing for Bankruptcy Fraud in New York

A conviction for bankruptcy fraud is punishable by up to five years in federal prison as well as significant fines and forfeiture of assets. In addition, almost certainly, the petition for bankruptcy will be dismissed with prejudice. As is the case with all federal felonies, in order to decide upon an appropriate sentence, the district court judge will consider first the applicable federal sentencing guidelines which suggest a range of sentences based on a number of factors, the most significant of which is the amount of money or “loss” to creditors that the fraud caused or was intended to cause. In addition, the number of creditors defrauded and the complexity of the means used to commit the fraud will also impact the guidelines calculation. So too will a judge’s finding as to whether the fraud is found to have violated a court order or process. A person’s personal history and circumstances will of course also be considered in arriving at the final sentence. There are many scenarios that can arise in a bankruptcy fraud trial, that’s why it’s crucial that you have the highest quality of representation from an experienced NYC bankruptcy fraud lawyer.

Defenses to Bankruptcy Fraud Charges in New York

As with all federal offenses, the government must prove all of the elements of the crime beyond a reasonable doubt. Thus, for bankruptcy fraud, many of the defenses available from an NYC bankruptcy fraud attorney involve challenges to one or more of these critical elements which define the crime.

First, because bankruptcy cases are heavily dependent upon completion of paperwork and reports, oftentimes it happens that a person accidentally fails to include one or more assets or the transfer of such an asset on a required disclosure form. If it can be shown that an omission or misstatement was the result of a mistake rather than an intentional act intended to deceive, a successful defense involving lack of intent may be asserted.

Second, if it can be shown that the accused had a lawful or legitimate purpose in engaging in an act, such as the sale of a purportedly valuable asset at a reduced price in order to gain a tax deduction, this too provides a valid defense.

Third, if the accused recognizes that an omission or misstatement was made and took steps to correct the error, a defense of renunciation may be viable.

Fourth, in bankruptcy cases, it may be possible that the statute of limitations of five years has elapsed prior to indictment.

Speak With An NYC Bankruptcy Fraud Lawyer Today

With so much at stake, bankruptcy fraud charges in New York require an expert and experienced defense. The variety of ways in which federal investigators and prosecutors charge these offenses means that your choice of defense counsel must possess a keen understanding of how bankruptcy filings and proceedings work and a genuine appreciation for the myriad possibilities for unintentional misstatements or omissions by otherwise fine individuals. NYC bankruptcy fraud lawyer, Fred Sosinsky, has been helping New Yorkers effectively fight federal charges of bankruptcy fraud for more than 30 years. Let Fred add you to his list of clients who have successfully navigated a federal bankruptcy fraud investigation or prosecution.

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A successful contractor was arrested and charged with felony possession of a loaded firearm and Class C felony possession of marijuana based upon the seizure of these items in a search pursuant to warrant. As has been well advertised, in almost all gun cases in NYC, prosecutors will insist on state prison sentences even for those willing to plead guilty. After presentation of mitigating evidence however, Mr. Sosinsky was able to negotiate a sentence of nine months in jail for his client, meaning his client was out in six months.

A young man who had been a heralded star high school hoopster in Brooklyn was indicted as part of a large multidefendant fraudulent check cashing conspiracy. The client unfortunately had previously been involved in a similar prosecution and worse yet had been arrested during the pendency of the federal case for yet again committing a similar offense. Notwithstanding these hurdles, Mr. Sosinsky was able to convince the federal judge to spare his client a prison sentence and allow him to earn his freedom while on probation.

Mr. Sosinsky represented a prominent attorney accused of assaulting and endangering the welfare of his 13 year son. It turned out that the child was being used as a pawn by the client’s ex-wife and that the incident at the heart of the case involved proper disciplining of a difficult and, at times, violent child. Eventually, the charges against the lawyer were dismissed.

Mr. Sosinsky obtained a verdict of not-guilty of murder in the execution style shooting of a young man involved in gang activities in Harlem, New York City. By demonstrating important differences in the description of the shooter from witnesses called by the prosecution, Mr. Sosinsky was able to raise valid doubts about the correctness of the identifications made at trial.

A few years back, Mr. Sosinsky represented a Manhattan man who was arrested after stabbing his wife in the neck numerous times with a knife in their Upper West Side apartment. The client was indicted for attempted murder. However, after having the client examined by a forensic psychiatrist, it became evident that a compelling insanity defense was in order. Eventually, the prosecutors involved were unable to adequately prepare to counter this defense and the case was dismissed.

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December 5, 2023 No Comments