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Personal bankruptcy requires disclosures in California

California readers may be interested to learn about a man who recently reported that he lost a great deal of money during the world-wide banking crisis. The man, like many here in California, says that he had to seek the protections offered by a personal bankruptcy due to these losses. The losses spanned across two nations and included real estate and other investments.

The personal bankruptcy filing required that the man at the center of this case disclose his assets and debts. In his filing, he reported that he owed a large $940 million when he filed to various creditors. This amount, he reportedly hoped, would be largely discharged at the end of the personal bankruptcy case.

However, before a discharge can occur, a lawsuit filed as a result of the case must first be decided. In the lawsuit, creditors claim that the man failed to tell the truth during the required meeting of creditors. If this is found to be the case, the man faces a dismissal of the personal bankruptcy.

In California, a person must fully disclose all information as is required by the court during the personal bankruptcy process. This is important to avoid possible penalties such as a potential dismissal. However, once all of the information is reviewed and creditors are repaid what they are able to be paid, a debtor can find that they are able to be free of the debts that they once owed. This slows for a fresh start for many people in California and elsewhere.

Source: The Wall Street Journal, “Ireland’s Bad Bank Blasts Developer’s U.S. Bankruptcy,” Patrick Fitzgerald, July 10, 2013

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