Do Not Hide Assets When In Bankruptcy

The reported on November 26 2010, that “Real Housewives of New York” star Sonja Morgan filed for bankruptcy protection in Manhattan. According to the news article, Morgan listed $19.8 million in debt and $13.5 million in assets on her bankruptcy petition. She blamed her money troubles on a failed venture with Hannibal Pictures Inc. to make a movie with John Travolta. Morgan started production on the film, titled “Fast Flash to Bang Time,” never began because Travolta demanded conditions her production company could not meet. In a lawsuit Hannibal Pictures Inc. filed against her company, Sonja Productions, Morgan lost in $7 million judgment. She also suffered a divorce. After bankruptcy, Morgan planned to pursue writing a cookbook and developing a clothing line.

Many people who file bankruptcy are not those who do not work hard or those who do not know how to budget or save. Most people get into debt when life does not go as planned, when they do business with the wrong people, when they look too much at what is missing, or when they love someone they did not have to know. People do not realize legal troubles when they arise because small decisions define people, not the big moments. When unimaginable financial troubles happen, adapt by looking into bankruptcy options to move on. If people second guess too much on their mistakes, life passes by.

After acknowledging financial mistakes of the past, it is important not to make further mistakes that ruin the life a person still has to look forward to. A person in debt may fear losing everything. This could tempt anyone into hiding personal assets by giving them to family or friends. Do not hide assets! An individual in bankruptcy can be convicted for fraud. In the bankruptcy process, a person must tell the truth in filings with the court, during recorded questioning with trustees, in front of the judges at hearings, and in meetings with their attorneys.

No matter what material things are taken away, trust the bankruptcy process to protect some assets from creditors by fully disclosing financials. Bankruptcy is like the rope that keeps a person hanging on when s/he climbs to the top after a fall. A climber cannot climb to the top without trust. When borrowing money or consolidating debts, as long as a debtor’s heart is beating, the debtor can start fresh. Seeing a public blemish may never be easy. There may be regrets, but people can only live with the consequences of their decisions. A bitter divorce may lead to financial troubles. A failed business may lead to a lawsuit with a losing judgment. The tragedy is not bankruptcy, but lying awake at night and wondering “what if”. Bankruptcy does not mean flunking out of the university of life. In bankruptcy, the debtor is the tragic hero who withstands discomfort to become a stronger person.

When in debt, engage an experienced New York bankruptcy attorney for support in evaluating bankruptcy options.

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