Declaring bankruptcy is a major decision that people facing financial difficulties come to after weighing the benefits against the possible perceived disadvantages. Within a few years of emerging from bankruptcy, people can apply and receive credit cards, loans and mortgages. Filing for personal bankruptcy in the form of Chapter 7 can erase many bills and put an automatic stay on foreclosure proceedings - filers can even retain possession of their residential home. But these benefits are only useful for those who are interested in filing for bankruptcy, not companies who are being haled into bankruptcy court as the result of a hoax.
A company in Arizona has found out that some trickster has filed for bankruptcy on their behalf twice, once in January and once in February of this year. The petitions were accepted by the clerk accepting petitions but were dismissed soon after. It was later learned the signatures of the board of directors had been forged on the Chapter 7 petition.
UNS Energy first found out about the first Chapter 7 filing two days after it was filed and they immediately informed the bankruptcy court clerk's office, the U.S. Marshals Service and the U.S. Trustees office among others. The second time around, a petition was filed under a company not affiliated with UNS - in fact the company did not exist at all - and the petition was dismissed within 24 hours of filing. The judge noted that the court clerk could not be instructed to summarily reject all petitions, but she did assure company officials that these petitions could not live long once filed, because after a petition is filed it comes quickly to the judge to be heard.
This case demonstrates the speed with which the bankruptcy court addresses all petitions. Quick court cases in bankruptcy proceedings can be of use to people looking to end their financial problems fairly quickly. Bankruptcy proceedings can be a useful resource for Arizona residents facing financial difficulties, as they give the filer an opportunity to start their financial life anew.
Source: Inside Tucson Business, "TEP victim of bankruptcy hoax," Hillary Davis, Feb. 28, 2014