Do not remove your name off of a bank account before a Chapter 7 Bankruptcy in Brooklyn

Folks, light blog today as it is Friday and I know the last thing you want to do is read about Bankruptcy. That is, of course, unless you’re looking to file for bankruptcy today. In any event, I just want to take a minute to discuss hiding assets in Bankruptcy. Part and parcel of this is the fact that many people do not think that removing their names from bank accounts with money on them, right before they file for Bankruptcy in New York City, is a way of hiding assets. It in fact is, and you should not do it. Under any circumstances. Ever.

Now look, I know you may be thinking “Chapter 7 NYC Bankruptcy Attorney Daniel Gershburg, you have a nice tie, and also, I have all this money in an account with my brother. I’ve never used the account. I have no check signing authority on the account. I don’t even know my name was on it. But it’s there, and I don’t want my brother’s money taken should I file for bankruptcy, so I’m going to remove it.” This is one version. The other, more common version, is that you do it, and you don’t tell your lawyer about it. Which is, by far, the worst thing you could possibly do. In either example, you’re engaging in hiding assets. This may not be the same, in your mind, as taking money out of your account and putting it under the mattress, but in the Court’s eyes it is.

Here’s the other part. Let’s say your name IS on a bank account with some other family members and there is some money in it. If you’ve never taken a dime, if you’ve never accessed the account, if you’ve never deposited money into the account, the Trustee will likely not touch the account. However, if you’ve been using the account and you take your name off before you file, that’s simply not allowed. And realistically, what’s happening here. You’re trying to save a few thousand dollars while getting rid of tens of thousands of dollars of debt.

At the end of the day, the moral and the lesson is this: Don’t do anything without speaking to your consumer Bankruptcy attorney. I wouldn’t bring my car in to the mechanic and say “I heard a noise, and I thought it sounded like it was going to be expensive, so I ripped out some hoses. Here. Fix it.” The same applies here. This is a huge financial decision for you. Make sure everything you’re doing is correct. Speak to us before you do it.