Over the past two months, the Justice Department has arrested 78 people and charged them with bankruptcy fraud in a sting dubbed “Operation Truth or Consequences.”The arrests put the feds on track to outpace 2005’s estimated total of 100 bankruptcy fraud cases. Eighteen of the arrests came this week alone.
Collectively, the fraud operation includes:
- Charges against nine attorneys, two bankruptcy petition preparers, and one former law enforcement officer;
- Alleged concealment of more than $3 million in assets;
- Use of false Social Security numbers and false identities;
- Submission of forged documents and use of false statements;
- Defrauding of individuals whose homes were in foreclosure; and,
- Fraudulent receipt of government loans and benefits, among other unlawful acts.
Also announced was the creation of a new Internet hotline for reporting suspected bankruptcy fraud to the U.S. Trustee Program, the Department of Justice office charged with protecting the integrity of the bankruptcy system. Members of the public can report suspected bankruptcy fraud via email to USTP.Bankruptcy.Fraud@usdoj.gov.
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