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Hence, trustee filed a complaint seeking the revocation of debtor’s discharge on October 4, 2006. Debtor responded in her answer to the complaint that the errors were inadvertent and not intended to hinder, delay or defraud creditor. Since the substance of the misrepresentations and omissions clearly went to the heart of her financial disclosures, the court found that they were intentional, made ‘knowingly and fraudulently.’ The court found that the ‘sheer number and significance of the inaccuracies and omissions encompassing the false statements demonstrate, at the very least, a reckless indifference to the truth – the functional equivalent of fraud. The false statements infect every asset related schedule and statement in the bankruptcy petition so as to completely shed doubt on the debtor’s honesty.’ The debtor amended the schedules to correct the misstatements and omissions several months after she was told of the inaccuracies but these amendments did not change the court’s conclusion that the false statements were made knowingly and fraudulently.

Therefore, debtors must exert all efforts to be as accurate and complete as possible in disclosing financial information when preparing the bankruptcy petition. For instance, all assets here and abroad must be disclosed. This means that if you have real estate abroad, you must disclose it. Or, if you have bank accounts abroad, you must disclose them. If you have business abroad, you must also disclose it. Your lawyer will help you exempt and keep all your assets, including your assets abroad. Failure to disclose foreign assets may not only result in denial of your discharge, it may even result in jail time for debtor if a bankruptcy crime has been committed. So, if you have a 300 ft luxury yacht with your name on it parked beside the yacht of Michael Douglas in the Bahamas, you must disclose this asset in your bankruptcy. If you don’t, you are making a false material oath in bankruptcy which will result in denial of your discharge.