False Oath or Account18 U.S.C. § 152(2)
Subsection 152(2), of Section 152 provides:
A person who...knowingly and fraudulently makes a false oath or account in or in relation to any case under title 11;...shall be fined..., imprisoned..., or both.
The elements of a false oath violation have been defined as:
- the existence of a bankruptcy proceeding;
- a statement made under oath;
- the statement must be material;
- the statement must be false; and
- the statement was made knowingly and fraudulently.
Metheany v. United States, 390 F.2d 559, 561 (9th Cir.), cert. denied, 393 U.S. 824 (1968).
Absent fundamental ambiguity or imprecise questioning, the meaning and truthfulness of the defendant's answer when questioned under oath in the bankruptcy proceeding is for the jury. The defendant "cannot escape a false oath charge by misleading the questioner with false testimony and then supply literally true answers to questions based on his false testimony." United States v. Robbins, 997 F.2d 390, 395 (8th Cir.), cert. denied, 114 S. Ct. 391 (1993); United States v. Schafrick, 871 F.2d 300 (2d Cir. 1989).
CAVEAT: A literally true but unresponsive answer, even if intentional misleading, is to be "remedied through the 'questioner's acuity' and not by a federal perjury conviction." Bronston v. United States, 409 U.S. 352, 362 (1973).
The false oath or account must be given "in relation to any [bankruptcy] case. . ." Therefore testimony in adversary proceedings, depositions, or even creditor meetings are encompassed by the broad language of the statute. United States v. Jackson, 836 F.2d 324 (7th Cir. 1987); United States v. Yagow, 953 F.2d 427 (8th Cir.), cert. denied, 506 U.S. 833 (1992).
The false statement must be made with respect to a material matter. United States v. O'Donnell, 539 F.2d 1233, 1237 (9th Cir.), cert. denied, 429 U.S. 960 (1976). The law has been that the materiality of a false statement in a bankruptcy fraud prosecution is a question of law to be decided by the court, not the jury. United States v. Key, 859 F.2d 1257, 1261 (7th Cir. 1988); United States v. Metheany, 390 F.2d 559 (9th Cir.), cert. denied, 393 U.S. 824 (1968). However, the Supreme Court's recent decision in the § 1001 area in effect reverses this line of cases on this issue, so the better practice is to submit the materiality question to the jury. United States v. Gaudin, 115 S. Ct. 2310 (1995).
Materiality of a false statement has been broadly interpreted to mean that the false statement bears a relationship to the bankrupt's business transactions or estate, or pertains to the discovery of assets, including the history of the bankrupt's financial transactions. United States v. Jackson, 836 F.2d 324, 329 (7th Cir. 1984); United States v. O'Donnell, 539 F.2d 1233, 1237-38 (9th Cir.), cert. denied, 429 U.S. 960 (1976). Thus misstatements as to defendant's social security number and past names are material, United States v. Phillips, 606 F.2d 884, 886 (9th Cir. 1979), cert. denied, 444 U.S. 1024 (1980), as is the failure to list prior bankruptcy filings, United States v. Lindholm, 24 F.3d 1078, 1083 (9th Cir. 1994), post conviction relief denied, 61 F.3d 913 (1995).
PRACTICE TIP: A failure to answer a question on the bankruptcy petition can constitute a false statement since leaving the question blank had the same effect as if the debtor had affirmatively replied "none." United States v. Ellis, 50 F.3d 419 (7th Cir.), cert. denied, 116 S. Ct. 143 (1995).
PRACTICE TIP: In some circuits, the common law rule requiring two witnesses or one witness and corroboration is no longer followed. United States v. Jessee, 605 F.2d 430, 431 (9th Cir. 1979); but see, Mosheim v. United States, 285 F.2d 949, 951 (5th Cir.), cert. denied, 365 U.S. 868 (1961).
Where the defendant falsely testifies or produces other false information before a court 18 U.S.C. § 1623 may be used. Section 1623 does away with the "two witness" rule and also allows a defendant to be convicted where the defendant makes inconsistent statements in the same proceeding. This section can also be used to prosecute the "I don't remember" answer where it can be shown that the witness did know at one time and has, in fact, not forgotten.
CAVEAT: Section 1623 applies only to statements made before a court or grand jury.
PRACTICE TIP: The reasoning of decisions under Section 1623 may also apply to false oath cases under 18 U.S.C. § 152(2). Under 18 U.S.C. § 1623(d), a perjury prosecution is barred if the defendant can show that the perjurious testimony was recanted in the same continuous court or grand jury proceeding. The recantation must be unequivocal. United States v. Tobias, 863 F.2d 685 (9th Cir. 1988); United States v. Moore, 613 F.2d 1029 (D.C.Cir. 1979), cert. denied, 446 U.S. 954 (1980); United States v. D'Auria, 672 F.2d 1085 (2d Cir. 1982); United States v. Goguen, 723 F.2d 1012 (1st Cir. 1983). see also, United States v. Diorio, 451 F.2d 21, 23 (2d Cir.), cert. denied, 405 U.S. 955 (1971)(a recantation in and of itself cures an original false statement under oath).
Subsection (2) of Section 152 also prohibits the making of false accounts. The term "account" is not defined in the statute. Generally the term "account" means a reconciliation or reporting of a financial activity -- i.e., an accounting. Thus a debtor in possession's monthly report, a trustee's semi-annual report, a trustee's final report in an asset case; a creditor's report of rents received, and an auctioneer's report of sale are all examples of "accounts."
[cited in USAM 9-41.001]