For many businesses saddled with massive debts in Salem, a Chapter 11 bankruptcy may be their only hope of staying in business while escaping further action from being taken by their creditors. However, it should be remembered that simply filing for bankruptcy does not provide one with a clean slate. Indeed, bankruptcy is a process rather than an event, and those who seek the protection that it provides are also required to work with the court by being transparent in their business actions. A failure to do so could leave a business owner facing a situation even more dire than the one that lay before him or her prior to seeking bankruptcy protection.
Dance studio owner and reality television star Abby Lee Miller could be made to learn this lesson the hard way. Miller filed bankruptcy in 2010 to reorganize her business. Yet the U.S. Attorney for western Pennsylvania alleges in a recent indictment that from 2012-2103, Miller concealed income she earned through merchandise sales and dance clinics, as well as what she earning from her many reality shows through several hidden bank accounts. In all, it is estimated that Miller stashed over $750,000 away. She now faces the potential of having to pay up to $5 million in fines, as well as serving five years in prison.
The primary reason why business owners and management groups file Chapter 11 bankruptcy is because they want their companies to continue. That prospect becomes much more difficult if one doesn’t comply with federal-mandated bankruptcy guidelines. An experienced bankruptcy attorney may be of great assistance in assuring that such compliance occurs.
Source: FoxNews.com “’Dance Moms’ star Abby Lee Miller indicted on bankruptcy fraud charges” Oct. 14, 2015