Debtor’s Apparent Draining of Bank Accounts Days Before Filing Chapt...


Bankruptcy lawyers regularly caution debtors to avoid unusual financial transactions, including credit card charges, cash withdrawals, and the like, prior to filing their case.  This is a case in which a pro se debtor withdrew several thousand dollars in the week before filing and got caught.  In addition, Debtor also requested, and initially received, approval for a waiver of her filing fee because she appeared destitute.  In re Ricks, Ch. 7 Case No. 13-60100, 2013 Bankr. LEXIS 3355 (Bankr. S.D. Ga. July 15, 2013) (click here for opinion).  Based upon her testimony at the 341 meeting, and bank statements, it appeared Debtor omitted material information from her schedules, gave her mother a $1,000 gift within 90 days prior to filing, and withdrew $8854 from her accounts in the week before filing.   A hearing on the Trustee’s Motion for Turnover was held, and Judge Dalis found the Debtor’s testimony that she spent the money on living expenses “evasive.”   Not surprisingly, the docket reflects that an objection to the Debtor’s discharge has been filed.  This case is a lesson – Trustees usually find out.