Jail Time for Dishonest Bankrupt

Bankruptcy is a system designed to allow persons struggling with debt to manage and repay their debts and start with a clean slate once discharged.  However, it is also designed to protect the public from persons who have shown that they are unable to manage their finances.

Therefore, a bankrupt will have a number of obligations during the term of their bankruptcy aimed at protecting the public.  There can be serious consequences for a bankrupt failing to comply with their obligations under the Bankruptcy Act 1966 (Cth).

In a recent decision, Wayne Panther, a twice bankrupt boat builder, was sentenced to 19 months imprisonment for breaches of the Bankruptcy Act 1966 (Cth).  Mr Panther had obtained $275,000.00 from Mr and Mrs Dibley, being their superannuation savings, to provide them with goods and services.  However, Mr Panther had failed to advice Mr and Mrs Dibley that he was an undischarged bankrupt, in breach of the Bankruptcy Act 1966 (Cth).  Judge Robertson found that this conduct was dishonest and had Mr and Mrs Dibley been notified of his bankruptcy status, they would have been unlikely to give Mr Panther their savings.

This decision serves as a warning to any undischarged bankrupts to ensure they are honest in their dealings with the public.

If you require advice regarding bankruptcy and any obligations of an undischarged bankrupt, contact McLaughlins Lawyers, bankruptcy and insolvency lawyers on the Gold Coast.