The Untied States bankruptcy trustee has reinstated random audits of consumer bankruptcy filings on March 10, 2014. U.S. Bankruptcy Trustees may randomly designate for audit one out of every 250 consumer bankruptcy cases. The Bankruptcy Code also authorized audits of any cases in which debtors posted statistically unusual income or expenditures.
It is very important that the consumer’s bankruptcy schedules be completed accurately. For that reason an experienced bankruptcy attorney should be used. If auditors identify a “material misstatement” in their review of a debtor’s financial information, creditors will be notified and the bankruptcy court will be notified. It’s up to the individuals involved in the case to determine what, if anything, happens next.
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