Lawrenceville Couple Sentenced for Bankruptcy Fraud
Thomas G. Grogan, 50, and Debra A. Grogan, 54, both of Lawrenceville, Illinois, were each sentenced on Friday, April 12, 2013, in United States District Court in Benton to 3 year terms of probation for fraudulently concealing assets from the United States Trustee and chapter 7 trustee during the pendency of their 2009 bankruptcy case in the United States Bankruptcy Court, announced Stephen R. Wigginton, United States Attorney for the Southern District of Illinois. Both waived indictment by the Grand Jury and pled guilty to an information charging them with that offense on December 7, 2012.
“My office will not condone any lies in any official proceeding,” said United States Attorney Wigginton. “Keeping the process fair for all is what I intend to do.”
“Concealing assets in a bankruptcy proceeding is a crime that threatens the integrity of the bankruptcy process and public confidence in that process, ” stated Nancy J. Gargula, United States Trustee for Southern Illinois, Central Illinois, and Indiana (Region 10). “We are grateful to all of our law enforcement partners, and in particular to U.S. Attorney Steve Wigginton for his commitment to pursuing those who commit bankruptcy fraud.”
Evidence introduced in support of the guilty pleas and sentences showed that in 2009 the Grogans filed a bankruptcy petition in which they sought to discharge $24,506.00 in debts owed to various creditors. Under bankruptcy law, the Grogans were required to list all of their assets, including any interest they might have in any lawsuit from which they might receive a settlement or award of damages. The Grogans repeatedly failed to disclose on their petition or to the Chapter 7 Trustee that Thomas Grogan expected to receive a settlement of $111,770.05 related to the pharmaceutical Vioxx. The Chapter 7 Trustee, however, independently discovered the existence of the settlement and was able to seize the funds and distribute them to the Grogans’ creditors.
In addition to his 3 year term of probation, Thomas Grogan was ordered to pay to the United States fines and special assessments totaling $2100 and to perform 30 hours of community service. Debra Grogan was also ordered to pay $2100 and to perform 20 hours of community service.
The case was investigated by the Federal Bureau of Investigation with the assistance of the United States Trustee for Region 10 and the Peoria Office of the United States Trustee. Region 10 of the U.S. Trustee Program is headquartered in Indianapolis, Indiana, with additional offices in Peoria, IL and South Bend, IN. The U.S. Trustee Program is the component of the Justice Department that protects the integrity of the bankruptcy system by overseeing case administration and litigating to enforce the bankruptcy laws.
The case was prosecuted by Assistant United States Attorney James M. Cutchin.