Date: 08-20-2018

Case Style:

Case Number: 9:17-cr-00018-DLC

Judge: Dana Christensen

Court: United States District Court for the District of Montana (Missouri County)

Plaintiff's Attorney: Chad C. Spraker and Keith A. Jones

Defendant's Attorney: John Rhodes

Description: Missoula, MT - Man Sentenced to Federal Prison for Concealing Assets During His Bankruptcy

Randall Alan Franz, a 59-year-old resident of Sandpoint, Idaho, was sentenced on Thursday to 8 months in prison followed by three years of supervised release, and ordered to pay $205,084.79 in restitution after pleading guilty to concealing assets in bankruptcy. Chief U.S. District Judge Dana Christensen announced the sentence.

Franz’s mother passed away in 2009. Franz was appointed as personal representative of her estate in October, 2010, a responsibility he held until he was removed in September of 2015. Franz was to split his mother’s estate, ultimately valued at almost $600,000, equally between himself and his two brothers. While one brother received approximately $120,000, Franz made no distribution to his other brother.

In the meantime, Franz filed a chapter 11 bankruptcy in July 2010, which was converted to a chapter 7 bankruptcy in January 2013. During his bankruptcy, Franz liquidated assets from his mother’s estate and hid his share of the proceeds from his Chapter 7 Trustee. Though Franz withdrew more than $270,000 of probate estate funds between April and October of 2013, Franz’s bankruptcy trustee received none of it. Based on this deception, the United States Bankruptcy Court revoked Franz’s discharge on November 5, 2015, and Franz was referred for criminal prosecution.

“The bankruptcy system is an important safety net for all Americans. People like the defendant who misuse it for their own personal gain threaten its integrity and will be prosecuted, ” said Kurt Alme, U.S. Attorney for the District of Montana.

18:152(1) CONCEALMENT OF ASSETS IN BANKRUPTCY
(1)

§152. Concealment of assets; false oaths and claims; bribery

A person who—

(1) knowingly and fraudulently conceals from a custodian, trustee, marshal, or other officer of the court charged with the control or custody of property, or, in connection with a case under title 11, from creditors or the United States Trustee, any property belonging to the estate of a debtor;

(2) knowingly and fraudulently makes a false oath or account in or in relation to any case under title 11;

(3) knowingly and fraudulently makes a false declaration, certificate, verification, or statement under penalty of perjury as permitted under section 1746 of title 28, in or in relation to any case under title 11;

(4) knowingly and fraudulently presents any false claim for proof against the estate of a debtor, or uses any such claim in any case under title 11, in a personal capacity or as or through an agent, proxy, or attorney;

(5) knowingly and fraudulently receives any material amount of property from a debtor after the filing of a case under title 11, with intent to defeat the provisions of title 11;

(6) knowingly and fraudulently gives, offers, receives, or attempts to obtain any money or property, remuneration, compensation, reward, advantage, or promise thereof for acting or forbearing to act in any case under title 11;

(7) in a personal capacity or as an agent or officer of any person or corporation, in contemplation of a case under title 11 by or against the person or any other person or corporation, or with intent to defeat the provisions of title 11, knowingly and fraudulently transfers or conceals any of his property or the property of such other person or corporation;

(8) after the filing of a case under title 11 or in contemplation thereof, knowingly and fraudulently conceals, destroys, mutilates, falsifies, or makes a false entry in any recorded information (including books, documents, records, and papers) relating to the property or financial affairs of a debtor; or

(9) after the filing of a case under title 11, knowingly and fraudulently withholds from a custodian, trustee, marshal, or other officer of the court or a United States Trustee entitled to its possession, any recorded information (including books, documents, records, and papers) relating to the property or financial affairs of a debtor,

shall be fined under this title, imprisoned not more than 5 years, or both.

Outcome: Defendant committed to the custody of the BOP for a term of 8 months. Supervised release for a term of 3 years. Conditions as stated in open court. Fine waived. Special assessment of $100.00. Restitution is awarded in the amount of $205084.79 (interest waived).

Plaintiff's Experts:

Defendant's Experts:

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