Monday, May 17, 2010

Section 523(a)(2)(A): False Pretenses

Section 523(a)(2)(A) excepts for discharge any debt for money to the extent obtained by false pretenses. A creditor must show that the debtor’s actions were purposefully deceptive or misleading. Courts infer requirements establishing intent, reliance and materiality.



To provide that a debtor acted by false pretenses, the objecting creditor must show the following: (1) an implied misrepresentation or conduct by the debtor; (2) promoted knowingly and willingly by debtor; (3) to create a contrived and misleading understanding of the transaction on the part of the objecting creditor; and (4) which wrongfully induced plaintiff to advance money, property, or credit to the debtor. The frauds covered by this concept are those which in fact involve moral turpitude or intentional wrong.
 
Warmest Regards,

Bob Schaller

Your Bankruptcy Advisor

Blog By: Attorney Robert Schaller (Bob's bio) of the Schaller Law Firm Click for Bankruptcy Lawyer Job Opportunities. You are invited to contact Attorney Schaller at 630-655-1233 or visit his website at Discharging Student Loans to learn about how the bankruptcy laws can help you. Bob is a member of the National Bankruptcy College Attorney Network, American Bankruptcy Institute and the National Association of Consumer Bankruptcy Attorneys. For information about Chapter 7 bankruptcy Click Here
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