known creditors and non-disclosure

March 30th, 2010 by Questions

what are the consequences to a bankrupt who failed to disclose all of his/her assets to the trustee?

And, what are the consequences to a bankrupt who did not disclose to the trustee of a known creditor who was as a result not included as a creditor on Form 79? If the bankrupt is subsequently discharged, can the known creditor that was not named still go after the debtor or is the debt released?

Posted from: Ontario

Questions

One Response to “known creditors and non-disclosure”



March 31, 2010 at 6:11 am, A licensed trustee said:

If the trustee finds out that not a bankrupt’s assets were disclosed the bankrupt will be taken to Court to explain their conduct. The Court may decide how to handle the matter and in cases like this in the past it has refused to garnt a person a discharge as a penalty for not fully discloing their assets.

The credit issue is somewhat similar. All debts are included when a person files for bankruptcy, but if the creditor that wasn’t disclosed can convince a Court that the bankrupt knowingly left them off the list of debts then the Court may allow the debt to survive. Further, the bankrupt may be penalized for failing to disclose all of their debts.

If you are a bankrupt that has done either of these things I strongly suggest you speak to your trustee and come clean – everything can be fixed, but it will go much harder on you if the trustee finds out for themselves that you haven’t disclosed all of your assets or debts.

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