... the
Trustee conducted further investigation and discovered Debtor had
withdrawn over $30,000 from a different account more than one year
prior to entering bankruptcy and had placed that cash in a home safe.
When this additional information came to light, Debtor again amended
his schedules, identifying several assets. He included a possible
interest in the $30,000 cash and claimed that interest as exempt. The
Trustee objected to this amendment, alleging Debtor had acted in bad
faith by initially failing to disclose the cash in the home safe.
The trustee lost at the bankruptcy court level, and appealed to the next level. The trustee lost at that level, too, and appealed to the Eighth Circuit Court of Appeals (which is, practically, the last stop before the Supreme Court).
At all three levels the judges said that the Debtor was able to amend his claim of exemptions to cover what he could of the "hidden" funds. (I am not sure what the debtor said to explain how he forgot that he had $30,000 in a safe at home!)
So, superficially the debtor "won". However, if you look at the bankruptcy case, the debtor lost his discharge (waived it, presumably because he was certain to lose); AND the debtor had the thrill of trying the case and going through two levels of appeal. And he did not represent himself at least during some parts of the case.
THE MORAL: It is VERY expensive to try to hide things from bankruptcy trustees. Not only did the debtor not get rid of his debts, he surely ran up a lot of attorneys fees during the case. So, don't hide stuff -- it ain't worth it!
The case is: Rucker v. Belew (In re Belew) No. 18-3045 ( 8th Cir. 11/26/2019)
