Bankruptcy Judge Makes Criminal Referral of Serial Filer Who Duped C...

A serial bankruptcy filer was criminally referred to the U.S. Attorney's Office in the Northern District of Texas in connection with an alleged and convoluted series of bankruptcy filings in his own and his ex-wife's name in order to stay pending foreclosure proceedings.  U.S. Bankruptcy Judge Gernigan's memorandum opinion sorting out the facts and making the criminal referral is available here.

According to the court, Gabriel Santos, who had filed bankruptcy three times, was barred from filing bankruptcy for 180 days after having his most recent chapter 13 case dismissed with prejudice. To work around the bar, Santos sought to file bankruptcy in his ex-wife's name, without a power of attorney or any other form of authorization, to prevent imminent foreclosure on his house. He falsified emails purportedly from his ex-wife authorizing the bankruptcy and sent them to his attorney the day before the scheduled foreclosure.  Santos also brought to counsel $3,500 cash.  Counsel filed a chapter 13 petition, schedules, and statement of financial affairs using Mrs. Ramos's name and social security number without obtaining a single wet signature.  Santos said his ex-wife was out-of-town and unavailable to talk to counsel on the telephone—yet, somehow, she was supposedly able to take credit counseling from a remote location and email counsel a purported profit and loss statement for a business. The attorney decided to forge Mrs. Ramos's electronic signature at least six times on documents filed with the court—allegedly assuming, in good faith (according to the court), that he had her permission—via her ex-husband—to do so.

Eventually, the chapter 13 trustee filed a motion to dismiss the case and counsel, in an attempt to undo his mistake, filed a motion to expunge on behalf of Mrs. Ramos.  After a hearing, the bankruptcy court declined to expunge the case, lest evidence of potential bankruptcy fraud might be eliminated.  Instead, the court directed the chapter 13 trustee to submit an order of dismissal.  The bankruptcy court determined that Santos not only abused the bankruptcy system but also manipulated counsel assisting Santos in what appeared to be a scheme to commit bankruptcy fraud and identity theft against his ex-wife.  As a result, Judge Gernigan referred the matter to the U.S. Attorney for further inquiry.