Open Book Bankruptcy Records Opens Door To Fraud
In todays electronic age, it is easy to learn of someones financial habits simply by searching bankruptcy records available online. While meant as a
warning to potential creditors or business investors about a persons personal financial history, the open book of bankruptcy records also places
individuals at risk for potential identity fraud.
When a person files for bankruptcy, whether it is Chapter 7 or 13 for personal bankruptcy or Chapter 11 for business reorganization, every part of
bankruptcy records become open to the public as a public record. Following a bankruptcy there is a waiting period of several years before that person
can file again, credit may be attainable and some fraudsters will use the information in the bankruptcy records to take out loans in that persons name.
While many claim this lack of privacy is a hindrance to the bankrupt, other say that when they failed to meet their financial obligations, they gave up
their right to privacy.
Additionally, the persons bankruptcy records will become part of their financial history, affecting their credit report for several years, influencing the
interest rate they must pay on future loans that will be considerably higher than loans for people without the stigma of a bankruptcy on their record.
For many, bankruptcy becomes the only option when their financial obligations exceed their ability to pay. There appears to be no other choice but to
start over again. Although the court can release a person from debt in the hope that they will use it as a learning experience to get their finances back
in order, bankruptcy records on every person or business that have filed a claim are kept for ten years, during which time it is open for any curious
person to view.
Bankruptcy records are not only designed to be a warning to others against future dealings, they are also meant to be an embarrassing reminder to
the debtor that s/he needs to pay bills on time. Even though in recent years the stigma of ban