Brief Fact Summary. Defendant applied to act as counsel for bankruptcy proceedings without disclosing that one of the filing corporations primary creditors was a client of his firm’s.
Synopsis of Rule of Law. Rule 2014 of the Federal Rules of Bankruptcy Procedure.
When a defendant is charged with a specific intent crime, the government may present other acts evidence to prove intent.View Full Point of Law
Issue. Was there sufficient evidence presented at trial to established that Defendant’s failure to disclose his firm’s prior relationship with his client’s creditor was fraudulent?
Held. Yes. Defendant’s knowing omission of material facts met the statute’s requirements, and the government provided sufficient evidence (including the Defendant’s own testimony as to his mental state at the time) to establish that Defendant was guilty.
Discussion. This is a rather extreme example of the consequences of non-disclosure, as criminal charges for this kind of behavior are extremely rare. In his trial, Gallene (testifying as the only defense witness) argued that his behavior was “stupid, but not criminal.” Do you agree?.