Page 29 - Network Magazine Spring 2019
P. 29

Rather than assume that your labor will bear no fruit, you should make an inquiry further into the particulars of the customer/client’s predicament to determine if you are able to get paid because you may be pleasantly surprised.
 4. Fraudulent Conduct: As noted above, the Con- gressional intent in the Bankruptcy Code is to pro- vide “a fresh start” to an individual who has little, if any, prospect of satisfying his debts in the ordinary course of his affairs. To that end, the Bankruptcy Code mandates that the debtor file for relief from creditors in good faith. Where the individual has en- gaged in criminal, fraudulent, intentionally false and/ or malicious conduct prior to filing bankruptcy, the individual may be denied a discharge of his debts. Assume that as a creditor you loaned money to the debtor in reliance upon the statements made, or documents produced, in a loan application which have turned out to be untrue, then you are in a po- sition to object to the debtor obtain a discharge of the debt upon which the false information is based.
5. Fraudulent Transfers: A person who transfers money or assets, or who makes purchases of cer- tain goods, in the months leading up to the filing of bankruptcy may not be a good faith debtor. In these circumstances, with the assistance of the case trustee and the Bankruptcy Court, you may be able to recover the money or assets from the third-party transferee in order for a distribution to be made to creditors.
The preceding are just a few examples of protections which are built-into the United States Bankruptcy Code to protect creditors and which illustrates that upon your receipt of a notice that your customer/client has filed bankruptcy you still may get paid.

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