Are Bank Records Checked in Bankruptcy?
- Your bankruptcy paperwork includes a set of schedules, which list all of your creditors, your property, your income and your expenses. Your paperwork also includes the Statement of Financial Affairs, which discloses if you sold property, owned a business or transferred money prior to your bankruptcy. You prepare and sign these documents under penalty of perjury, and the information contained therein must be true and accurate.
- The court appoints a trustee to administer every Chapter 7 case and every Chapter 13 case. A Chapter 13 trustee's job is to collect your Chapter 13 plan payments and disburse the money to your creditors; a Chapter 7 trustee's job is to liquidate non-exempt assets and collect money to distribute to your creditors. The bankruptcy trustee will review all of your schedules and your Statement of Financial Affairs very carefully.
- A Chapter 13 trustee may review your bank statements if she wants to confirm how much money you make and what your expenses are. The income and expenses you report in your schedules will determine the amount of your Chapter 13 plan payment; if you do not have paystubs or if the trustee wants to verify how much you spend on certain things, she can demand that you provide bank statements to make sure you are paying enough into your Chapter 13 plan.
- A Chapter 7 trustee may request bank statements to find out if you have transferred any large sums of money or if you have received any large sums of money prior to your bankruptcy filing. Under certain circumstances, the trustee may be able to claim that money for the estate.