Pittsburgh Entrepreneur Pleads Guilty To Bankruptcy Fraud
Accurate calculations, especially in the service of predictions, can help you be successful in business, but so can being vague about numbers and their significance in the right situations. Business owners get away with fuzzy accounting on a regular basis; most of the time, no one finds out until there is a tax audit or some other legal process that leads to increased scrutiny. Falsifying your company’s internal accounting books can get you into trouble if the authorities look closely at them, but if you are audacious enough to make false statements on an official request for financial relief, such as an insurance claim, loan application, or bankruptcy filing, you can face charges for financial crimes such as wire fraud and mail fraud. If you are facing accusations that statements you made on official financial documents were false, contact a Pittsburgh white collar crime lawyer.
Bankruptcy Fraud and Pennsylvania Law
According to federal law, everyone who has debts they are unable to repay has the right to file for bankruptcy protection. If your bankruptcy filing is successful, the court will discharge your eligible debts, meaning that you are no longer responsible for repaying them; court-ordered obligations such as child support, criminal fines, and restitution payments are not dischargeable, and tax debts are only dischargeable under limited circumstances. Individuals may file under chapter 7 or chapter 13, and there are other categories for filings by businesses, farms, and public entities. The bankruptcy court has the right to reject your filing if you make inaccurate statements. You can also get criminal charges for bankruptcy fraud if you make false statements on your petition for bankruptcy protection and the supporting documents and if you misuse the bankruptcy process.
In the News
Prasad Margabandhu owned a property on Carson Street in Pittsburgh; like many real estate owners, he incurred heavy debts in relation to the property. By 2019, he had fallen behind on mortgage payments, and he owed overdue taxes. He filed for bankruptcy protection for two of his companies whose business activities were connected to the Carson Street property. The press release on the Department of Justice website was not specific about the chronology of events, but at some point before the end of 2022, the Carson Street property suffered severe damage in a fire, and Margabandhu submitted an insurance claim.
Eventually, Margabandhu, now 48, faced criminal charges for mail fraud and wire fraud. Prosecutors claimed that he made false statements on the insurance claim, and that the bankruptcy filings were merely a tactic to delay legal proceedings against him related to the Carson Street property. In September 2024, Margabandhu pleaded guilty. He could face a maximum sentence of 25 years in prison, but it is unlikely that he will receive the maximum, given his guilty plea and lack of prior criminal history.
Contact Gary E. Gerson About Criminal Defense Cases
A criminal defense lawyer can help you if you are facing criminal charges related to bankruptcy fraud. Contact the law offices of Gary E. Gerson in Pittsburgh, Pennsylvania about your case.
Source:
justice.gov/usao-wdpa/pr/pittsburgh-resident-pleads-guilty-bankruptcy-mail-fraud-charges-related-east-carson
