Marshall Woman Sentenced for False Statement in Bankruptcy Proceeding
MADISON, WIS. -- John W. Vaudreuil, United States Attorney for the Western District of Wisconsin, announced that Martha J. Graves, 59, Marshall, Wis., was sentenced today by U.S. District Judge James D. Peterson to five years of probation for making a false statement under oath in connection with a bankruptcy proceeding. She was also ordered to pay $186,597.99 restitution to creditors in the bankruptcy. Martha Graves pleaded guilty to this charge on November 10, 2015.
Paul Graves, 60, Middleton, Wis., the former husband of the defendant, was sentenced on November 20, 2015, by Judge Peterson to five years of probation with six months’ home confinement for making false statements under oath in connection with the same bankruptcy proceeding. He was also ordered to pay $186,597.99 restitution to creditors in the bankruptcy.
Paul and Martha Graves owned and operated Mauston Home Center, LLC, a hardware business in Mauston, Wis. In connection with the operation of that business, they personally owed in excess of $500,000 in debts to creditors of the business.
On May 12, 2010, Paul and Martha Graves filed a Chapter 7 petition for personal bankruptcy in the U.S. Bankruptcy Court for the Western District of Wisconsin, and failed to fully disclose assets and concealed assets from creditors, the bankruptcy trustee and bankruptcy court. After the filing of the bankruptcy petition, Martha Graves testified under oath at a bankruptcy proceeding that all the statements of financial affairs and schedules were correct and complete. However, she knowingly failed to disclose and concealed the following:
1. Her husband’s ownership of a portion of an island in Canada with a two bedroom cabin that had been used by the Graves for recreation since 1995;
2. Her joint ownership of a home in Jackson County, Wis.;
3. Her joint ownership of more than $200,000 in two bank accounts in Black River Falls, Wis.; and
4. Their joint ownership of a rent-free lifetime tenancy of a home in Middleton.
In sentencing Martha Graves, Judge Peterson expressed his disapproval of dishonest disclosures made before the bankruptcy court which relies upon the candor and truthfulness of bankruptcy petitioners. However, he noted Martha Graves’s lack of any criminal history, her health issues, and her cooperation with the government’s investigation as indications that she is not likely to commit crimes in the future. Therefore, Judge Peterson found that a sentence of probation was sufficient to meet the objectives of punishment and rehabilitation.
The charge against Martha Graves was the result of an investigation conducted by the U.S. Bankruptcy Trustee’s Office and the Federal Bureau of Investigation. The prosecution of the case has been handled by Assistant U.S. Attorney Robert A. Anderson.