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Debtor twice acted in bad faith

Where a debtor materially and intentionally understated the value of real property on his schedules, and intentionally purchased a new vehicle with the intent to reduce his disposable monthly income, he acted in bad faith.


Stephen Neuman Asamoah is the debtor. This matter comes before the court on the Chapter 13 trustee’s motion to dismiss and on the motion to dismiss of Elizabeth Nana Nsiah. The motions are joined by Woehrle Dahlberg Yao PLLC and Joseph Goldberg.

The Ghana property

The trustee, supported by the creditors, argues that the debtor’s valuation of the Ghana property was unreasonably low and intentionally so. The debtor valued the Ghana property in his Schedule A/B at $10,000, which he testified was a “land-only” valuation. The debtor undoubtedly was presented with some difficulty in valuing a nearly completed residence in a foreign country.

That notwithstanding, the court finds the debtor’s “land-only” valuation was unreasonable. The debtor stated under oath in the state court that the property had a value of $250,000. Further, the debtor had in his possession an appraisal indicating that the property had a market value of $254,000, and a forced sale value of $203,200, as of June 1, 2020. Whatever the value of the Ghana property may be, it was worth substantially more than $10,000 at the time the debtor filed his schedules in this case.

The debtor states that he disclosed that this was a land-only valuation at the meeting of creditors, and that both of his plans call for the sale of the Ghana property and the contribution of his half of the proceeds to the bankruptcy estate. Testimony at a meeting of creditors, however, is not a substitute for accurately listing the value of assets in the schedules. The court, the trustee and the creditors must be able to rely on the schedules without reference to what might have occurred at the meeting of creditors. On balance, the court finds that the debtor materially and intentionally understated the value of the Ghana property.


The trustee and the creditors next object to the debtor’s purchase of the 2021 Highlander as an indication of bad faith. The trustee describes the purchase as a “last-minutetransaction” made with the intent to reduce the debtor’s disposable monthly income. The debtor testified that he was motivated to purchase the 2021 Highlander solely because he was contemplating a bankruptcy filing. Indeed, there was no other discernable reason to purchase the car. The court finds that this purchase was made in bad faith.

The court finds, however, that the failure to list the trade-in of the 2015 Highlander in the original statement of financial affairs was inadvertent, and that it was timely corrected in the amended statement of financial affairs. The court finds no bad faith on this issue. The court also finds no bad faith regarding the debtor’s testimony at the meeting of creditors regarding the Highlander purchase.

Debtor’s disposable income

The debtor has taken a deduction in the amount of $530 for repayment of the $27,000 401(k) loan in both his means test and his amended means test. The court does not find any bad faith in the debtor’s deduction for repayment of an actual 401(k) loan, even where the debtor elects to begin repaying the loan when he enters bankruptcy. However the court won’t allow the debtor to deduct any amount for repayment of the so-called $14,100 in loans from Tech Giants, because these loans aren’t documented and are more accurately characterized as income.

The court orders that the debtor promptly file and obtain confirmation of a Chapter 13 plan that pays all of his creditors 100% of their claims. If the debtor is unable to confirm a 100% plan, or if for any reason the case is dismissed (or if the debtor seeks to convert the case) before the case is closed, the court will dismiss the case with prejudice for a period of one year.

Motions to dismiss granted in part.

In re: Stephen Neuman Asamoah, No. 21-11888, March 29, 2022. EDVA Bankr. at Alexandria (Kenney). VLW No. 022-4-003. 22 pp.

Editor’s note: A version of this digest that appeared in the April 25, 2022, print issue misidentified the case as VLW No. 022-4-016.

VLW 022-4-003