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Bankrupt tells 'fairy-tale' and goes to prison

Monday, 3rd March 2014

A bankrupt who claimed he had no assets, had been unemployed, and in receipt of benefits for a number of years has been sentenced to two years imprisonment. The court heard that he failed to declare that he had £33,160.29 of cash in his estate at the time of the bankruptcy and failed to account for payments totalling £97,074.16 out of his personal bank accounts in the 12 months before he became bankrupt.

Mr Anthony Kellett, aged 54, was convicted Sheffield Crown Court on 27th January 2014.

The court heard that Mr Kellett presented his own bankruptcy petition on 27 April 2010 and within weeks of the bankruptcy order claimed he was the victim of an armed robbery, during which a holdall containing cash of £33,160 was stolen from him. The police intercepted the robbers and recovered the cash which they subsequently retained under Proceeds of Crime Act (POCA).

Whilst Mr Kellett alleged that the monies were loaned to him post bankruptcy by relatives who were aware of his bankruptcy, the relatives were unwilling or unable to provide statements or documentary evidence to the police and the money was successfully claimed by the trustee in bankruptcy.

The Official Receiver’s (‘OR’) investigators, within the Insolvency Service suspected that the cash actually related to profit from a haulage business operated during Mr Kellett’s pre-bankruptcy period, and the receipt of bank statements showing significant cash movements from his bank accounts in the 12 months prior to his petition confirmed this.

The Judge presiding over a previous hearing described Mr Kellett’s account as a “fairy-tale” and indefinitely suspended his discharge from bankruptcy. As Mr Kellett has provided no further explanation to date, he remains an undischarged bankrupt.

In addition, the court made an order against him for the costs of the prosecution of £14,287.63 to be paid within three months or face the possibility of incurring a further sentence.

A Bankrupt’s responsibility

A bankrupt is required to provide information to the Official Receiver (OR) and his trustee in bankruptcy to allow his property to be collected and realised for the benefit of his creditors. It is an offence not to disclose property to the OR or trustee and not to mention things which are relevant to his affairs.

The honest bankrupt

Mike Thomas head and founder of DebtWizard.com said: "Those consumers who are honest and cooperative need not worry about going to jail. The vast majority of consumers who eventually go bankrupt are genuine individuals who are treated with respect and support by The Insolvency Service and go through bankruptcy without any repercussions. However cases like this send a clear warning to those who deliberately set out to cheat the system."

Further reading on how previous bankrupts have gone to prison:

Jail for bankrupt who transferred £30,000 to girlfriend to cheat creditors

Bankrupt estate agent gets nabbed for undervaluing his house and gambling away the profits

Bankrupt faces prison and blames loan sharks for missing £50,000

Bankrupt goes to prison for hiding £23,000

Bankrupt goes to prison over 'secret' bank account

Four months for lying 'two time bankrupt' who claimed loan sharks took his money

You can follow Mike on twitter by using @debtwizard

 

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