Sumner Woman Sentenced to Federal Prison for Bankruptcy Fraud
For Immediate Release
U.S. Attorney's Office, Northern District of Iowa
Hid $147,000 Inheritance Check
A woman who hid a $147,000 inheritance check from her creditors in bankruptcy court was sentenced on December 21, 2023, to federal prison. Debra S. Leisinger, age 58, from Sumner, Iowa, received the prison term after an August 7, 2023 guilty plea to one count of bankruptcy concealment.
In a plea agreement, Leisinger admitted that, on December 8, 2022, she filed for Chapter 7 bankruptcy in the United States District Court for the Northern District of Iowa, by means of sworn court filings. When a debtor files a petition seeking protection from creditors under the bankruptcy laws, a “bankruptcy estate” is created, which is comprised of all property belonging to the debtor, wherever located, and by whomever held, as of the time of the filing of the bankruptcy case, and debtors must truthfully disclose their assets to the court in court filings. Leisinger admitted she fraudulently concealed that she was in possession of a $147,969.28 inheritance check on the date she filed for Chapter 7 bankruptcy. An attorney had handed Leisinger the check on December 1, 2022, but Leisinger did not immediately cash it. On December 16, 2022, Leisinger cashed the check into an account she controlled at a local credit union. As a part of her scheme, Leisinger attempted to discharge over $65,000 in debts that she owed to her creditors but keep her entire inheritance. Ultimately, the United States Trustee discovered Leisinger’s scheme, she waived her Chapter 7 discharge, her bankruptcy was dismissed, her inheritance was applied to repay her creditors, and she was prosecuted federally.
Leisinger was sentenced in Cedar Rapids by United States District Court Chief Judge Leonard T. Strand. Leisinger was sentenced to two months’ imprisonment. Leisinger was also ordered to repay $5,000 for her court-appointed attorney fees. She must also serve a two-year term of supervised release after the prison term. There is no parole in the federal system.
Leisinger was released on the bond previously set and is to surrender to the United States Marshal in January 2024.
The case was prosecuted by Assistant United States Attorney Timothy L. Vavricek and was investigated by the Federal Bureau of Investigation. The Office of the U.S. Trustee referred and assisted in the investigation.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 23-CR-2028.
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Updated December 26, 2023