White Collar Roundup (June 2012)

For Bankruptcy Fraud, It's Not Material

Misstatements in bankruptcy filings need not be material to run afoul of 18 U.S.C. 1519, according to this opinion from the U.S. Court of Appeals for the Fourth Circuit. Section 1519 makes it a crime to knowingly make a false entry in any record with the intent to "impede, obstruct, or influence" the administration of a bankruptcy filing. In the case, the trial court refused to instruct the jury that materiality was an element of a violation of § 1519. After he was convicted of violating that statute, the defendant appealed, claiming the trial court had erred by refusing to give the instruction. The Fourth Circuit affirmed, holding that the plain language of the statute did not include any element of materiality.