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Rolex watch unravels couple’s bankruptcy, leads to prison time

Charlotte Bankruptcy Lawyer Bryan W. Stone of Arnold & Smith, PLLC answers the question “What is a bankruptcy discharge ?”

 

A doctor who once ran a successful east coast anesthesiology practice that employed hundreds of physicians and his wife have been sentenced to a year each in federal prison for concealing assets in their failed 2008 bankruptcy.

Rolex Watch Charlotte North Carolina Bankruptcy Attorney Mecklenburg Debt LawyerAfter Dr. Richard Krugman and his wife filed for bankruptcy, the trustee overseeing their case became suspicious that the pair were concealing assets from creditors.

The Palm Beach Sun-Sentinel reports that ultimately the bankruptcy trustee paid a surprise visit to the couple’s Boca Raton home. When he did, the trustee “noticed that an expensive-looking watch suddenly disappeared” from the wrist of Tamara Giordano—Dr. Krugman’s wife. When Krugman asked her where the watch was, Giordano “started to cry and pulled a gold-and-diamond Presidential Rolex out of her pocket,” according to the Sun-Sentinel.

When Krugman and Giordano petitioned the bankruptcy court to discharge their $2.9 million in debts, the judge—noting that Krugman and Giordano were not credible—rejected their request. In practical terms that means the couple is still responsible for the debt that drove them into bankruptcy in the first place.

After their failed bankruptcy, prosecutors filed bankruptcy fraud charges against Krugman and Giordano. The failed bankruptcy coupled with the federal fraud charges accelerated a stunning fall from material grace, as the couple moved from their Boca Raton home to Texas, where Krugman worked for a time. The couple returned to West Palm Beach, living in a hotel until their rewards points ran out and then moving into an extended-stay motel.

Krugman and Giordano admitted to concealing assets including “significant amounts of jewelry and artwork” from creditors and the bankruptcy court in their Chapter 7 bankruptcy. According to the Sun-Sentinel, investigators could not track down some $120,000 in jewelry the couple say they pawned.

In December, the couple pleaded guilty to one count each of bankruptcy fraud for concealing assets. Last Wednesday, a judge sentenced the pair to a year-and-a-day each in federal prison.

In a letter to the judge, Krugman acknowledged that he and Giordano had acted “in an obnoxious, elitist and cavalier manner.” Krugman said he was “penniless, facing incarceration” and added that his medical license had been imperiled by the proceedings.

United States District Court Judge Kenneth Ryskamp questioned whether jail time was appropriate for Krugman and Giordano, appearing to suggest that the couple had been sufficiently punished by having their bankruptcy discharge rejected and losing their possessions.

Prosecutor Carolyn Bell pointed out, however, that Krugman had actually made $400,000 since 2010 and that family members had given the couple as much as $10,000 month, yet neither Krugman nor Giordano had made any effort to repay their debts. Bell added that “there had to be criminal consequences for lying in bankruptcy proceedings and hiding assets,” according to the Sun-Sentinel.

If you find yourself needing the services of an experienced Charlotte, North Carolina bankruptcy attorney, please call the skilled lawyers at Arnold & Smith, PLLC find additional resources here. As professionals who are experienced at handling all kinds of bankruptcy matters, our attorneys will provide you with the best advice for your particular situation.

 

 

About the Author

Bryan 1Bryan Stone is a Partner with Arnold & Smith, PLLC, where he focuses his practice on all aspects of bankruptcy, including: Chapter 7, Chapter 11, Chapter 13, home loan modifications and landlord-tenant issues.

A native of Macon, Georgia, Mr. Stone attended the University of Georgia, where he earned a BBA in Banking and Finance, and Wake Forest University School of Law, where he obtained his law degree.

Following law school, Mr. Stone relocated to Charlotte, where he currently serves as Chair of “Bravo!” – a young professionals organization associated with Opera Carolina – and founded the University of Georgia Alumni Association of Charlotte.

In his spare time, Mr. Stone enjoys perfecting his barbeque skills for the annual “Q-City BBQ Championship” and playing softball in the Mecklenburg County Bar softball league.

 

 

Sources:

http://www.sun-sentinel.com/local/palm-beach/fl-krugman-bankruptcy-fraud-20150422-story.html

 

 

Image Credit:

“Image Rolex6613” by Original uploader was LuckyLouie at en.wikipedia – Transferred from en.wikipedia to Commons by User:Francis Flinch.. Licensed under CC BY-SA 3.0 via Wikimedia Commons – http://commons.wikimedia.org/wiki/File:Image_Rolex6613.png#/media/File:Image_Rolex6613.png

 

 

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