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66 East Main Street, 3rd Floor
Little Falls, NJ 07424
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Chapter 7 Bankruptcy – Lost Assets

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About Ralph A. Ferro Bankruptcy Lawyer

Chapter 7 Bankruptcy – Lost Assets

Chapter 7 Bankruptcy

Written and Verified by Ralph A. Ferro, Jr., Esq.

What is Chapter 7 Bankruptcy?

Chapter 7 Filing for Bankruptcy – Background

  • Debtors (both surgeons) filed for Chapter 7 Bankruptcy
  • $5.6 Million in Debt
  • $400K in assets which included jewelry they valued at less than $15K
  • Trustee noted a potential fraudulent transfer wherein the Debtor returned about 20-30 valuable watches.
  • The Debtors could not and did not keep accurate records of these watches.
  • Debtors would get watches from a jeweler and keep the ones they wanted and return the rest.  However, the receipts and returns did not match at all.
  • The jeweler filed a Proof of Claim for approximately $414K for watches that the Jeweler delivered to the Chapter 7 Debtors but were not returned.
  • The surgeon Debtors claimed that just did not keep good records. 
  • The Debtors wanted bankruptcy protection.

Bankruptcy Court Ruling

  • The trustee filed an adversary proceeding and the matter progressed to the appellant court.
  • The lack of receipts and returns were questionable at best.   The missing watches were neither found nor could be located in any paperwork indicating these watches were returned.
  • The U.S. Court of Appeals agreed with both lower courts.
  • The Chapter 7 Discharge for the surgeons were denied.

I hope these surgeons do a better job documenting their surgeries than their assets.

Chapter 7 Bankruptcy denied result:

  • The watches are still missing
  • Debtors also have all their debts. 
  • The Chapter 7 Trustee has every right to file an adversary proceeding. 

All assets must be listed when you file for bankruptcy.

As a bankruptcy lawyer, I always explain to my clients that Debtors must be completely honest.   When I file debtors’ petitions, we carefully review all aspects of the case.

Contact me for a Free Bankruptcy Consult:    I am here to provide you with bankruptcy protection.

Ralph A. Ferro, Jr., Esq., Board Certified in Consumer Bankruptcy Law by the American Board of Certification