Any debtor who commits fraud, testifies falsely, withholds records, etc. will be denied a discharge. This includes the false information provided on the bankruptcy petition, as the information is sworn to under oath. However, typically a debtor will only be denied a discharge if the false oath relates to a material matter of the case and has an impact on the creditors and the bankruptcy estate. Also, typically, for the denial of a discharge, the falsity must be intentional and not based on carelessness or mistakes.
Typically, fraud committed in connection with a particular debt or creditor will result in the exception of that particular debt from discharge and not the entire bankruptcy case. For example, an individual who is extended credit based on false information, at the time of the loan, will not be permitted to discharge that debt at the time of the bankruptcy filing. Typically, such fraud will not result in the denial of the discharge of all debt included on the petition.
Also, the fraudulent act of one debtor does not necessarily effect the dischargeability of the joint debtor’s debt, in a joint filed bankruptcy case. If one joint debtor failed to include an asset on the petition, in which the joint co-debtor was unaware of, the co-debtor’s right to a discharge will be unaffected.
You may contact Robert Manchel, a bankruptcy practitioner in NJ, at 1 (866) 503-5655.