Bankruptcy Asset Hunters Confirm What Most Of Us Already Knew: Everyone Lies On Social Media
Earlier this year Curtis Jackson III (aka “50 Cent”) raised some concerns with his bankruptcy judge, Ann Nevins, after he posted a couple of ill-advised pictures on Instragram of himself posing with $100,000s of dollars worth of cash. Apparently Chapter 7 trustees frown upon omitting “buckets of cash” from your official bankruptcy disclosures and then subsequently posing with that cash on social media. But, after being ordered to appear in court to explain the pictures, an embarrassed 50 Cent was forced to admit that the cash was fake.
As the Wall Street Journal points out, chapter 7 trustees all around the country are finding out that “fiddy” isn’t the bankrupt person “frontin” on social media.
This October, when Ido Alexander saw photos a young man had posted on social media, he thought he had hit the bankruptcy jackpot.
Mr. Alexander, a Florida lawyer working for a court-appointed trustee, dispatched an appraiser to the man’s home to inspect the expensive-looking gold chains and other jewelry he had been posing in, which he hadn’t declared as assets in court filings.
The appraiser made another discovery that is becoming all too common in the age of social-media braggadocio. “At the end of the day, it was really costume jewelry,” Mr. Alexander says. “It was really disappointing.”
The industry’s detectives—lawyers and accountants who serve as chapter 7 bankruptcy trustees—are learning what most teenagers have already figured out, which is that you can’t always believe what you see on Facebook and Twitter. “Gotcha” moments in which they discover people in bankruptcy posing in glamorous-looking jewelry, piloting boats and ATVs and even displaying buckets full of cash have fallen flat as the items turn out to be fake, or not theirs at all.
Of course, some people are dumb enough to actually hide real assets from the bankruptcy court which rarely works out all that well. Just ask Gregory Sipe of Virginia who decided to omit nearly $1 million worth of vintage guitars from his asset disclosures and earned himself five months of house arrest and nice little fine to boot.
Trustees say efforts to hide assets don’t happen often, but nevertheless have been going on for years. An Oklahoma man who filed for bankruptcy in 2005 failed to turn over profits from his ownership stake in a television show, the court ruled. The name of the show: “Cheaters.”
Tipped off by a creditor, North Carolina bankruptcy trustee John Bircher III, ran an online search on a Chesapeake, Va., businessman and found a newspaper article about his collection of 250 guitars. The man, Gregory Sipe, had only listed “several collectible guitars” worth $10,000 in his August 2010 bankruptcy filing.
When Mr. Bircher paid Mr. Sipe a visit, he recalls, he discovered a garage full of vintage guitars that later sold for almost $900,000. Lawyer Raymond Tarlton, who represented Mr. Sipe, said his client didn’t disclose the guitars because he thought he could fully pay his debts without selling them.
Mr. Sipe pleaded guilty, was sentenced to five months of house arrest and had to pay $5,900 for falsifying court records.
Who knew that people sensationalize their lives on social media? We thought we were the last remaining miserable people on the planet…this is a good news day.
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