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Dance Moms star charged in Chapter 11 bankruptcy fraud

Many Pennsylvania businesses and business owners have faced financial struggles over the past few years. In coming to terms with the changing economy, some have found it necessary to take a look at both their income and expenses to determine where adjustments can be made. Some have discovered that Chapter 11 bankruptcy can be a useful tool in reorganizing their debt.

With Chapter 11 bankruptcy, the business and/or individual are required to disclose their income and debts. Debts can then be reorganized based upon the type of debt with the possibility of some debt eventually being discharged. Additionally, those filing for Chapter 11 bankruptcy must file a statement of their income. This statement of income is used to identify funds available for debt repayment.

In filing these statements, one must keep in mind that these are legal documents and must be completely as truthfully and accurately as possible. "Dance Moms" star Abby Lee Miller has made news recently. Miller had petitioned the court for Chapter 11 bankruptcy. As a part of this petition, she had filed statements showing both income and expenses. However, in her statement of income, she failed to disclose over $500,000 in income.

Apparently the bankruptcy judge was reviewing his channel guide one night and came to the conclusion that Miller had to be earning more than she had disclosed. Miller has now been charged with bankruptcy fraud and is facing both fines and possible jail time. Pennsylvania businesses and business owners often find that Chapter 11 bankruptcy is useful in reorganizing their debt. However, it is a good idea to have experienced legal counsel review documents and provide guidance throughout the process.

Source: NBC Philadelphia, "Reality Star Abby Lee Miller Faces Prison or Probation in Pennsylvania for Concealing Income", Joe Mandak, Jan. 20, 2017

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