Learning From Celebrity Bankruptcies

Gee, lots of them in the news going on these days!  bankruptcy the-real-housewives-of-new-jersey

Not counting anything with the Trump name in it.

Let’s look at the Real Bankruptcy of Real Housewives of New Jersey star Theresa Guidice.

OK, her bankruptcy is old news.

She is in prison for fraud.

But now, is suing her bankruptcy lawyer.

Seems it is all his fault.

I am not impressed by lawyers spouting off in the press about a just filed case.

Her malpractice attorney is, of course, throwing mud at the bankruptcy attorney, blaming EVERYTHING on him.

Well, this is an old strategy, blame the lawyer when you are not happy with the result.

Let’s see how some of the accusations hold up.

First, the most common charge:  the lawyer filled that out, I did not know what I was signing!

“Defendant Kridel continuously filed documents that were materially inaccurate, but he permitted Plaintiff Giudice to sign declarations under penalty of perjury that the documents were accurate.”

Sure, sure.

The bankruptcy forms say YOU have read everything, and it IS true and accurate.

And you, the bankruptcy filer, swear to the accuracy again at the creditors’ meeting.

Guess what!


Especially when, as with tax returns, federal perjury penalties attach to wrong answers.

However, bankruptcy court is federal, and the attorney has a duty to reasonably investigate what he is being told.

During the bankruptcy proceedings, Kridel tells PEOPLE that the government notified him, saying that she had not filed tax returns for 10 years. “Clearly we were not involved in that,” he says. “She well knew that, unless she was in a coma for 10 years. That triggered people to examine, if she didn’t have a tax return how did she get mortgages? This came out of the blue. We had wished her well.

Well, considering the bankruptcy attorney has to provide copies of tax returns to the bankruptcy trustee, seems this lawyer should have seen this coming.

And, representing someone pulling down, presumably, big bucks as a TV star, why no tax returns?

Probably a debt to the IRS there that should have been listed.

The rest of the quotes are just conclusory allegations that the bankruptcy lawyer botched everything.

He will have to be more specific in court.

From the bankruptcy lawyer:

“She was chastised by the judge well after I represented her. There were failures to file income taxes, which occurred many years before we knew her. Her falsifying W2’s for mortgages – that has nothing to do with her bankruptcy.

True enough!

And probably enough to land her in the hoosegow, even if the bankruptcy filing was messed up.

But she also left off vehicles and real estate, ownership of which can easily be checked through government records.

Many companies provide services checking for these types of assets.

Did the bankruptcy lawyer ask about the car she was driving?

Not in the story.

Let’s not judge before all the facts are in.

But don’t bet on a judge letting you off with the excuse that you did not read, or understand, what you signed under penalty of perjury.

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