The Real Housewives of New Jersey Joe and Teresa Giudice are learning the hard way that honesty is extremely important when filing for bankruptcy. Lying (or “forgetting”) about what you own can not only cause trouble for your bankruptcy case, but can lead to fines and even prison time.

Honesty Is the Best Policy

If you’ve ever filed for bankruptcy, you probably read some fine print about having to disclose all of the assets you own when you file. More than likely, your attorney also stressed how important it is to be honest on your paperwork.

But did you ever have that small voice in the back of your head say to you, “so what happens if I don’t tell the court about an asset? Who is going to know?” Joe and Teresa may have heard that exact voice when filing for bankruptcy, because they didn’t quite disclose everything they own.

Slipping the Mind

Now we can probably forgive somebody for forgetting about a pair of shoes or a socket wrench. In fact, the court is pretty lenient if you leave off some minor assets. But that’s not what happened to Joe and Teresa. Not only did they not mention that they owned a cement mixer, an ATV, and some go-karts, but they also failed to mention that they owned some rental properties as well.

Their lives may be complicated and distracting, but it’s pretty hard to forget that you own some rental properties. Was it deliberate? We may never know for sure, but no matter how many assets you own, it’s imperative that you present to the court a detailed inventory of absolutely everything you own.

The Consequences of “Forgetting”

So what exactly happens when you commit bankruptcy fraud? The courts evaluate this on a case-by-case basis. But as the Giudices are learning the hard way, when you fail to tell the court about the expensive items you own, you may go to prison.

Keep in mind that Joe and Teresa are also guilty of mail fraud, wire fraud, and tax evasion. Breaking the law in this many different ways is not going to help them stay out of prison.

The end result is that Teresa is facing 15 months in prison while Joe is facing 41 months. Joe is not a citizen of the United States, so he may find himself deported back to Italy as well.

If any good can come of this, maybe it will serve as a warning to others who are filing for bankruptcy. It is extremely important to be honest with the court. If you don’t, you could wind up in jail.