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UNITED STATES BANKRUPTCY COURT MIDDLE DISTRICT OF FLORIDA ORLANDO DIVISION In re: CHARLES RANDOLPH LANCE, ) ) Debtor. ) ____________________________________ ) DONALD F. WALTON, ) ) Plaintiff, ) ) v. ) ) CHARLES RANDOLPH LANCE, ) ) Defendant. ____________________________________ ) Case No.: 6:11-bk-19272-ABB Chapter 7

Adv. Pro. No.: 6:12-ap-_____-ABB

UNITED STATES TRUSTEES COMPLAINT OBJECTING TO ENTRY OF THE DEBTORS DISCHARGE Plaintiff, Donald F. Walton, United States Trustee for Region 21, by and through his undersigned counsel, objects to the entry of an order of discharge for Charles Randolph Lance pursuant to 11 U.S.C. 727, and alleges the following: JURISDICTION 1. This is an adversary proceeding in which Plaintiff is seeking the denial of the

Defendants discharge pursuant to 11 U.S.C. 727(a)(2) and (a)(4). 2. 3. 4. This Court has jurisdiction pursuant to 28 U.S.C. 157 and 1334. This is a core proceeding pursuant to 28 U.S.C. 157(b)(2)(J). Plaintiff was appointed by the United States Attorney General as the United States

Trustee for Region 21, which includes the Middle District of Florida. 5. Plaintiff has standing to bring this action pursuant to 11 U.S.C. 307 and 727.

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6.

Venue is proper pursuant to 28 U.S.C. 1409(a) and Local Rule 1071-1 of the

United States Bankruptcy Court for the Middle District of Florida. BACKGROUND FACTS 7. On December 29, 2011 (the Petition Date), Charles Randolph Lance (the

Defendant) filed a voluntary petition for relief (the Petition) under Chapter 7 of the Bankruptcy Code, thereby initiating Bankruptcy Case Number 6:11-bk-19272-ABB (the Main Case). 8. The Defendants Petition, Bankruptcy Schedules, Statement of Financial Affairs,

and amended bankruptcy schedules are part of the Court record and were signed by the Defendant under penalty of perjury (Dkt. Nos. 1, 12 and 15 in the Main Case). 9. Gene T. Chambers was appointed as the Chapter 7 Trustee (the Chapter 7

Trustee) in the Main Case. 10. On December 30, 2011, the Clerk of Court docketed the Notice of Commencement

of the Defendants bankruptcy case (Dkt. No. 6 in the Main Case), wherein the Court established April 3, 2012 as the deadline for any interested party to file a complaint objecting to the Defendants discharge. 11. On April 27, 2012, the Court entered an Order Granting United States Trustees

Motion to Extend Time for Filing a Complaint Objecting to Discharge (Dkt. No. 32), in which the Court extended this deadline through and including July 23, 2012. 12. On July 24, 2012, the Court entered an Order Granting United States Trustees

Unopposed Motion for Second Extension of Time to File Complaint Objecting to Debtors Discharge (Dkt. No. 45), in which the Court extended this deadline through and including September 24, 2012.

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13.

The Section 341 Meeting of Creditors was initially held on February 3, 2012 (the

Initial 341 Meeting), when it was continued to, and concluded on, February 17, 2012 (the Continued 341 Meeting; collectively, the Initial 341 Meeting and the Continued 341 Meeting shall be referred to as the 341 Meetings). 14. On July 16, 2012, the undersigned counsel for the United States Trustee and Scott

Livingston, Esquire, counsel for Fifth Third Bank, conducted a Bankruptcy Rule 2004 Examination of the Defendant (the 2004 Examination). 15. The following facts are based substantially on the Defendants Petition, bankruptcy

schedules as amended, Statement of Financial Affairs, papers filed in the Main Case, documents that the Defendant provided to Plaintiff and the Chapter 7 Trustee, and the Defendants testimony at the 341 Meetings and 2004 Examination. Original Bankruptcy Schedules 16. The Defendant filed his original bankruptcy Schedules (Original Schedules) (Dkt.

No. 1) concurrently with the Petition. 17. Pursuant to the Defendants Declaration Under Penalty of Perjury for Electronic

Filing (Dkt. No. 5; the Declaration Under Penalty of Perjury), the Defendant signed his Original Schedules under penalty of perjury, declaring under penalty of perjury that the information contained therein is true and correct. 18. As reflected in the Defendants Original Schedule B, the Defendant listed assets

with values totaling $133,120.20, comprising the following: a. $120.00 in cash; b. $0.20 in checking, Wells Fargo, garnishment; c. $200.00 for a laptop;

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d. $150.00 in clothing; e. $2,500 in jewelry (wedding band, watch); f. $150.00 in golf clubs; g. $0.00 in term life insurance Axea; h. $0.00 in term life insurance Lincoln National; and i. $130,000 for five different leased Lexus vehicles. 19. In his Original Schedule B, the Defendant did not list any interests in an E-Trade

bank account, an E-Trade stock account, or any stock or other interest in incorporated and unincorporated businesses. 20. In his Schedule I, the Defendant listed his employer as American Truck Leasing

LLC and that he receives $19,750 in monthly gross wages, salary and commissions. 21. The Defendant is married, his spouse is an administrative employee at American

Truck Leasing, LLC, and her monthly gross wages, salary and commissions total $2,000. See Schedule I (Dkt. No. 1 at p. 32). Amended Schedule F

22.

On January 26, 2012, the Defendant filed an Amended Schedule F to add and/or

correct various creditors (Dkt. No. 12; the Amended Schedule F). 23. The Defendant signed his Amended Schedule F under penalty of perjury, certifying

under penalty of perjury that the information contained therein is true and correct. 24. As reflected in both his Original Schedule F (Dkt. No. 1) and his Amended

Schedule F (Dkt. No. 12), the Defendant is seeking to discharge approximately $31,266,404.63 in unsecured debt.

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25.

For every single debt included in his Original Schedule F (Dkt. No. 1) and his

Amended Schedule F, the Defendant, although required to do so, failed to specify the date each claim was incurred, the consideration for each claim, and if each claim is subject to setoff. Statement of Financial Affairs 26. The Defendant filed his Statement of Financial Affairs (Dkt. No. 1; SOFA)

concurrently with the Petition. 27. As set forth in both the SOFA and the Defendants Declaration Under Penalty of

Perjury, the Defendant signed his SOFA under penalty of perjury, declaring under penalty of perjury that the information contained therein is true and correct. 28. In response to Question 10(a) on his SOFA directing that the Defendant [l]ist all

other property, other than property transferred in the ordinary course of business or financial affairs of the debtor, transferred either absolutely or as security within two years immediately preceding the commencement of this case, the Defendant checked the box marked, None. 29. In response to Question 10(b) on his SOFA directing that the Defendant [l]ist all

property transferred by the debtor within ten years immediately preceding the commencement of this case to a self-settled trust or similar device of which the debtor is a beneficiary, the Defendant checked the box marked, None. 30. In response to Question 11 on his SOFA directing that the Defendant [l]ist all

financial accounts and instruments held in the name of the debtor or for the benefit of the debtor which were closed, sold, or otherwise transferred within one year immediately preceding the commencement of this case, the Defendant listed a single checking account at Carolina First.

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31.

In response to Question 14 on his SOFA directing that the Defendant [l]ist all

property owned by another person that the debtor holds or controls, the Defendant indicated that he was holding at his residence [p]ersonal property, furniture, etc. for his wife. The Initial 341 Meeting 32. At the beginning of the Initial 341 Meeting on February 3, 2012, the Defendant was

duly sworn, and he proceeded to testify after taking an oath to tell the truth. 33. At the Initial 341 Meeting, the Defendant testified that he read his schedules before

he signed them; that he understood when he signed his bankruptcy schedules, he was swearing that the information set forth therein was accurate and complete; and that he could not think of anything he needed to change in his schedules at that time. See Transcript of Initial 341 Meeting at page 4, lines 15 22. 34. When asked whether he has an ownership interest in Union Equity, Inc., the

Defendant testified, I dont. Id. at page 24, lines 7-9. 35. When asked whether he ever had an ownership interest in Union Equity, Inc., the

Defendant testified, Never. Id. at page 24, lines 10-12. 36. When asked, [i]snt it a fact that you had stock in Union Equity, Inc. and you

transferred it to the Martha Lance Irrevocable Trust in 2011, the Defendant testified, I never had stock in it. Id. at page 24, lines 13-16. 37. With respect to his financial accounts, the Defendant testified as follows: Chapter 7 Trustee: You list one bank account in your statements. What other financial accounts do you have, either joint, individual, business, personal, anything you have the ability to sign on? Defendant: I only have one other account. account. Chapter 7 Trustee: Where
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Thats the Wells Fargo

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Defendant: American Truck Leasing. Chapter 7 Trustee: Youre allowed to sign on American Truck Leasing? Defendant: Yes, maam. Chapter 7 Trustee: Okay. Any others that you are allowed to sign on? Defendant: No, maam. Chapter 7 Trustee: Okay. Mr. Stovash (counsel for Fifth Third Bank): If I may (inaudible). Chapter 7 Trustee: Just Mr. Stovash: He has he had an E-Trade account. Chapter 7 Trustee: Did you close that or Defendant: No, maam Chapter 7 Trustee: do you still have an E-Trade account? Defendant: I dont know if its closed or open but I can check and let you know. Chapter 7 Trustee: So there may have been an E-Trade account? Defendant: Yes, maam. Id. at page 34, line 5 through page 35, line 7 (emphasis added). 38. Based on this excerpt, the Defendant did not acknowledge that he had an E-Trade

account until AFTER its existence was revealed through Mr. Stovash, counsel for Fifth Third Bank. The Continued 341 Meeting 39. At the beginning of the Continued 341 Meeting on February 17, 2012, the

Defendant was duly sworn, and he proceeded to testify after taking an oath to tell the truth.

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40.

At the Continued 341 Meeting, the Defendant testified to the following as to his

ownership of stock in Union Equity, Inc.: Mr. Stovash (counsel for Fifth Third Bank): You are familiar with the name of a company called Union Equity, Inc.; isnt that correct? Defendant: Yes. Mr. Stovash: And that, sir, is a public company; isnt that correct? Defendant: Thats correct. Mr. Stovash: And did you not, sir, own numerous, hundreds and thousands of shares of Union Equity, Inc.? Defendant: Not to my knowledge, no. Transcript of Continued 341 Meeting at page 10, lines 16-24. 41. Further, Mr. Stovash asked the Defendant, [w]hat were the shares of stock that you

owned worth when you purchased those shares in Union Equity, Inc.? to which the Defendant testified that he didnt purchase any shares. Id. at page 15, lines 5-8. 42. Slightly later during the Continued 341 Meeting, Mr. Stovash asked the Defendant,

[s]o its your testimony that you never owned a share of stock in Union Equity, Inc. of which you are a director? to which the Defendant testified that he purchased stock through E-Trade, yes. Id. at page 17, lines 13-16. 43. With respect to his E-Trade assets, the Defendant further testified as follows: Mr. Stovash (counsel for Fifth Third Bank): Yes, stock shares. Where are they? Defendant: Its in E-Trade. Mr. Stovash: Im so sorry, sir, you told the Trustee that you dont have any money in E-Trade at our last meeting. Defendant: I didnt say that. Said I had seven dollars.
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Mr. Stovash: Seven dollars? Defendant: Yes. Mr. Stovash: Is it E-Trade? Defendant: I think thats correct, yes. Mr. Stovash: Now what happened what do you value these shares of stock in E-Trade at, seven dollars? Defendant: Thats cash in E-Trade. Mr. Stovash: Ill tell you what, tell me where the shares of stock in Union Equity are located so that the Trustee can know where to find an asset of your estate. Defendant: To find an asset of my estate? Mr. Stovash: Shes going to want to know where those shares of stock are for Union Equity. Mr. Ainsworth (counsel for the Defendant): triple 0, zero (sic), I think. Chapter 7 Trustee: Well, he didnt list he didnt even list an E-Trade account. I want records. Mr. Ainsworth: Well get them. Chapter 7 Trustee: He was supposed to give me all of the records for any account he had. Id. at page 18, line 13 through page 19, line 11. Omnibus Amendment to Schedules 44. On February 27, 2012, after both the Initial 341 Meeting and the Continued 341

Meeting, the Defendant filed an Omnibus Amendment to Schedules (Dkt. No. 15; the Omnibus Amendment(s)), wherein he amended Schedules A, B, C, and F and his SOFA. 45. In the Omnibus Amendment, the Defendant amended his Schedule B to add (i) an

E-Trade Account with a value of $7.62 as the Petition Date; and (ii) E-Trade Stock with a value
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of $2,047.24 as of the Petition Date. The Defendant included a corresponding amendment to his Schedule C to claim both of these assets as exempt. 46. The Defendant also amended his Schedule F for a second time to add one additional

unsecured creditor, Nordstrom Bank, but again, failed to specify the date the claim was incurred, the consideration for the claim, and if the claim is subject to setoff, despite being required to do so. 47. As set forth in this second amendment to Schedule F, the Defendant increased the

amount of unsecured debt he is seeking to discharge to approximately $31,266,704.63. 48. Again, for the debt included in his Original Schedule F (Dkt. No. 1) and his

Amended Schedule F, the Defendant failed to specify the date the claim was incurred, the consideration for the claim, and if the claim is subject to setoff as required. 49. While the Omnibus Amendments amended certain responses in the Debtors SOFA,

the Defendant never amended his responses to SOFA items 10(a), 10(b), 11 or 14. Rule 2004 Examination 50. At the beginning of Rule 2004 Examination on July 16, 2012, the Defendant was

duly sworn, and he proceeded to testify after taking an oath to tell the truth. 51. At his Rule 2004 Examination, in response to questions about his ownership of

stock in various entities, the Defendant testified as follows: United States Trustee: Was there a reason that you were not a share holder (sic) of any of these companies or a member? Defendant: Yes. United States Trustee: What is that reason? Defendant: Its because I had federal restitution of $2,000,000 and I could not be an owner.

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United States Trustee: When did when were you obligated to pay the federal restitution, at what point in time did that come about? Defendant: I think in 1994 lasts for 20 years. United States Trustee: And in that order you were prohibited from owning any interests from any companies? Defendant: Well, I dont know what was said, but anything that I owned would obviously be given to the government. United States Trustee: Okay. Why so youre (sic) understanding of the restitution, was it a restitution judgment? Defendant: Yes, it was. United States Trustee: And that was what was the lawsuit. Do you remember the name of the lawsuit? Defendant: No, I dont. United States Trustee: Okay. Defendant: There was a restitution Im sorry. Go ahead. United States Trustee: Tell me the nature of the lawsuit? Defendant: Its just saying I owe a judgment back to the FDIC. United States Trustee: And have you made any payments on you said it was a $2,000,000 judgment? Defendant: 1930, and yes I made payments. United States Trustee: And do you know how much? Defendant: No, I dont. United States Trustee: So youre (sic) understanding is that whatever you owned the judgment holder would be able to come after it? Defendant: Any judgment holder, whether it be anybody else have a judgment, is held by a path. It is non-dischargeable in bankruptcy. Transcript of Rule 2004 Examination at page 37, line 16 through page 39, line 2.

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52.

Although Bankruptcy Schedules E and F require debtors (i) to provide a complete

list of claims entitled to priority, listed separately by type of priority; and (ii) to identify all entities holding unsecured claims without priority against the debtor or the property of the debtor, as of the date of filing the petition; the Defendant did not list the existence of the FDIC judgment or obligation or identify the FDIC as a creditor in his Original Bankruptcy Schedules, his Amended Schedule F or in his Omnibus Amendments. Document Production 53. In response to a number of document requests, the Defendant produced to the

Plaintiff various documents. Martha D. Lance Irrevocable Marital Trust 54. The Defendant produced a document entitled, Martha D. Lance Irrevocable

Marital Trust, which was made as of August 11, 2010 (the Trust) by the Defendant as grantor and Blake Bolin, as trustee. 55. As set forth in the Assignment that the Defendant executed on August 11, 2010,

which is included as Schedule A to the Trust (the Assignment), the Defendant, as grantor, assigned to Blake Bolin, as trustee of the Trust, all of his right, title and interest in an to: (1) One Hundred Seven Million five Hundred Ninety Eight Thousand (107,598,000) shares of the Common Stock of Union Equity, Inc., a Delaware corporation, owned by him; and (2) One Thousand (1,000) shares of the common stock of CML III Funding, Inc., a Florida corporation, owned by him, which constitutes all of the authorized capital stock of said corporation. 56. The Defendant did not list in any of his bankruptcy schedules or on his SOFA the

transfers of stock reflected in the Assignment.

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E-Trade Statements 57. After the Initial 341 Meeting when Mr. Stovash revealed the existence of the

Defendants E-Trade account, the Defendant produced to Plaintiff certain E-Trade Statements (the E-Trade Statements) for his bank and stock accounts held at E-Trade under Account Number xxxx-7264 (the E-Trade Account), which account includes a stock account and a bank account. 58. The E-Trade Statements reflect that during the time period beginning on January 1,

2011 and through and including December 31, 2011, the Defendant made at least 265 separate purchases of Union Equity, Inc. stock. 59. The E-Trade statements also reflect that the Defendant had a bank account with E-

Trade which he used regularly during 2011. 60. follows: Date December 31, 2010 January 31, 2011 February 28, 2011 March 31, 2011 April 30, 2011 May 31, 2011 June 30, 2011 July 31, 2011 Stock $65,580.05 $45,610.24 $50,563.92 $856.01 $481.02 $1,706.24 $572.46 $591.37 Cash $1,961.79 $1,081.12 $1,082.60 $56,899.15 $51,609.12 $11,700.40 $13,954.60 $20,041.20 Total Balance $67,541.84 $46,691.36 $51,646.52 $57,755.16 $52,090.14 $13,406.64 $14,527.06 $20,632.57 The Defendants balances in his E-Trade assets, including stock and funds, were as

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Date August 31, 2011 September 30, 2011 October 31, 2011 November 30, 2011 December 31, 2011

Stock $583.60 $475.38 $224.08 $7.62 $7.62

Cash $4,845.89 $4,759.02 $447.66 $393.70 $284.25

Total Balance $5,429.49 $5,234.40 $671.74 $402.32 $291.87

61.

On or about July 8, 2011, the Defendant transferred out of his E-Trade account

100,000 shares of Union Equity, Inc. stock to, upon information and belief, an E-Trade account xxx-xx004-1 held by Dawn Renne, the Defendants daughter. 62. Upon information and belief, when the Defendant transferred out of his E-Trade

Account these 100,000 shares of Union Equity, Inc. stock on or about July 8, 2011, this stock was worth somewhere between $1.01 and $1.90 per share. 63. The Defendant failed to disclose anywhere in his bankruptcy schedules or SOFA

his transfer to his daughter of 100,000 shares of Union Equity, Inc. stock on or about July 8, 2011. 64. On or about October 26, 2011, the Defendant transferred out of his E-Trade account

90,000 shares of Union Equity, Inc. stock to, upon information and belief, an E-Trade account xxx-xx004-1 held by Dawn Renne, the Defendants daughter. 65. Upon information and belief, when the Defendant transferred out of his E-Trade

Account these 90,000 shares of Union Equity, Inc. stock on or about October 26, 2011, this stock was worth approximately $0.18 per share.

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66.

The Defendant failed to disclose anywhere in his bankruptcy schedules or SOFA

his transfer to his daughter of 90,000 shares of Union Equity, Inc. stock on or about October 26, 2011. COUNT I Objection to Discharge Pursuant to 11 U.S.C. 727(a)(2)(A) [The Defendant, with intent to hinder, delay, or defraud a creditor or an officer of the estate transferred, removed, destroyed, mutilated or concealed property of the Defendant within one year before the date of the filing of the petition.]

67.

The United States Trustee re-alleges and incorporates herein the allegations

contained in paragraphs 1 through 66. 68. Section 727(a)(2)(A) provides that the Court shall grant a debtor a discharge unless,

the debtor, with intent to hinder, delay, or defraud a creditor or an officer of the estate charged with custody of property under this title, has transferred, removed, destroyed, mutilated, or concealed, or has permitted to be transferred, removed, destroyed, mutilated, or concealed, property of the debtor, within one year before the date of the filing of the petition. 11 U.S.C. 727(a)(2)(A). 69. As set forth above, the Defendant, with the intent to hinder, delay or defraud a

creditor and/or the Chapter 7 Trustee, an officer of the estate charged with custody of property under the Bankruptcy Code, transferred, removed, and/or concealed, and/or permitted to be transferred, removed or concealed property of the Defendant, including, without limitation, the Defendants stock, the Defendants E-Trade Account, and stock and funds in the Defendants ETrade Account. 70. The Defendant sought to hinder, delay and defraud his creditors and/or the Chapter

7 Trustee, an officer of the estate charged with custody of property under the Bankruptcy Code,

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by transferring, removing and/or concealing these assets and failing to disclose these assets in his bankruptcy schedules and/or SOFA and at the Initial 341 Meeting. 71. The Defendant defrauded his creditors and the Chapter 7 Trustee by failing to

disclose these assets. 72. As a result, and pursuant to 11 U.S.C 727(a)(2)(A), the Defendants discharge

should be denied. WHEREFORE, the United States Trustee respectfully requests that the Court deny the Defendants discharge pursuant to 11 U.S.C. 727(a)(2)(A), and for such other and further relief the Court deems appropriate.

COUNT II Objection to Discharge Pursuant to 11 U.S.C. 727(a)(2)(B) [The Defendant, with intent to hinder, delay, or defraud a creditor have transferred, removed, destroyed, mutilated or concealed property of the estate after the date of the filing of the petition.] 73. The United States Trustee re-alleges and incorporates herein the allegations

contained in paragraphs 1 through 66. 74. Section 727(a)(2)(B) provides that the Court shall grant a debtor a discharge unless,

the debtor, with intent to hinder, delay, or defraud a creditor or an officer of the estate charged with custody of property under this title, has transferred, removed, destroyed, mutilated, or concealed, or has permitted to be transferred, removed, destroyed, mutilated, or concealed property of the estate, after the date of the filing of the petition. 11 U.S.C. 727(a)(2)(B). 75. As set forth above, the Defendant, with the intent to hinder, delay or defraud a

creditor and/or the Chapter 7 Trustee, an officer of the estate charged with custody of property under the Bankruptcy Code, transferred, removed, and/or concealed, and/or permitted to be

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transferred, removed or concealed, property of the estate including, without limitation, the Defendants stock, the Defendants E-Trade Account, and stock and funds in the Defendants ETrade Account, after the Petition Date. 76. The Defendant sought to hinder, delay and defraud their creditors and/or the

Chapter 7 Trustee, an officer of the estate charged with custody of property under the Bankruptcy Code, by transferring, removing and/or concealing these assets and failing to disclose these assets in the bankruptcy schedules and/or SOFA. 77. The Defendant defrauded his creditors and the Chapter 7 Trustee by failing to

disclose these assets. 78. As a result, and pursuant to 11 U.S.C 727(a)(2)(B), the Defendants discharge

should be denied. WHEREFORE, the United States Trustee respectfully requests that the Court deny the Defendants discharge pursuant to 11 U.S.C. 727(a)(2)(B), and for such other and further relief the Court deems appropriate. COUNT III Objection to Discharge Pursuant to 11 U.S.C. 727(a)(4)(A) [The Defendant knowingly and fraudulently, in or in connection with the case made false oaths and/or accounts.] 79. The United States Trustee re-alleges and incorporates herein the allegations

contained in paragraphs 1 through 66. 80. Section 727(a)(4)(A) provides that the Court shall grant a debtor a discharge unless

the debtor has knowingly and fraudulently, in or in connection with the case, made a false oath or account. 11 U.S.C. 727(a)(4)(A). 81. The Defendant signed his bankruptcy petition, schedules, SOFA, and amended

schedules under penalty of perjury that the information provided therein was true and correct.
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82.

The Defendant knowingly and fraudulently failed to disclose in his schedules and

SOFA assets, including, without limitation, the Defendants stock, the Defendants E-Trade Account, stock and funds in the Defendants E-Trade Account, and transfers of the Defendants assets. 83. Failure to disclose all assets and /or transfers as required in bankruptcy schedules

and statements signed by the Debtor under penalty of perjury constitutes a false oath. 84. The Defendants purposeful omissions of assets and transfers in his Original

Bankruptcy Schedules, SOFA, and Omnibus Amendments are material misstatements and constitute false oaths warranting the denial of discharge. 85. At the beginning of the Initial 341 Meeting on February 3, 2012 and at the

beginning of the Continued 341 Meeting on February 17, 2011, the Defendant was placed under oath prior to testifying. 86. At the 341 Meetings, the Defendant made multiple false oaths relating to his

ownership of certain assets, including, without limitation, the Defendants stock, the Defendants E-Trade Account, funds and stock in the Defendants E-Trade Account, and transfers of the Defendants assets. 87. These false oaths are material misstatements warranting the denial of the

Defendants discharge. 88. The Defendants false oaths in his Original Bankruptcy Schedules, SOFA, and The

Omnibus Amendments, and at the 341 Meetings, were made to conceal his assets. concealment of assets constitutes fraud and as such, is grounds for the denial of discharge. 89.

As a result, and pursuant to 11 U.S.C 727(a)(4)(A), the Defendants discharge

should be denied.

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WHEREFORE, the United States Trustee respectfully requests that the Court deny the Defendants discharge pursuant to 11 U.S.C. 727(a)(4)(A), and for such other and further relief the Court deems appropriate. COUNT IV Objection to Discharge Pursuant to 11 U.S.C. 727(a)(5) [The Defendant has failed to explain satisfactorily, before determination of denial of discharge under this paragraph, any loss of assets or deficiency of assets to meet the debtors liabilities.] 90. The United States Trustee re-alleges and incorporates herein the allegations

contained in paragraphs 1 through 66. 91. Section 727(a)(5) provides that the Court shall grant a debtor a discharge unless the

debtor has failed to explain satisfactorily, before determination of denial of discharge, any loss of assets or deficiency of assets to meet the debtors liabilities. 11 U.S.C. 727(a)(5). 92. As set forth in his Original Schedules, his Amended Schedule F, and his Omnibus

Amendments, the Defendant is seeking to discharge approximately $31,266,704.63 in unsecured debt. 93. However, the value of the Defendants personal property listed in his Original

Schedule B as amended in the Omnibus Amendment totals $5,175.06 (excluding the $130,000 in the Defendants five leased Lexus vehicles). 94. Based on the sheer discrepancy between the amount of the Defendants unsecured

debt, $31,266,704.63, and the $5,175.06 value of his personal property (excluding his five Lexus vehicles), the Defendant has failed to adequately explain the loss, transfer, or deficiency of his assets to meet his liabilities.

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95.

The Defendant has not provided an adequate explanation to identify the

consideration received in exchange for his $31,266,704.63 in unsecured debt and/or the disposition of such property. 96. Accordingly, the Defendants discharge should be denied for failure to satisfactorily

explain the loss of assets. WHEREFORE, the United States Trustee respectfully requests that the Court deny the Defendants discharge pursuant to 11 U.S.C. 727(a)(5), and for such other and further relief the Court deems appropriate. DATED: September 14, 2012. Respectfully submitted, DONALD F. WALTON United States Trustee, Region 21 /s/ Jill Ellen Kelso Jill Ellen Kelso, Trial Attorney Florida Bar No.: 0578541 U.S. Department of Justice Office of the United States Trustee 135 W. Central Blvd., Suite 620 Orlando, FL 32801 Telephone No.: (407) 648-6301, Ext. 137 Facsimile No.: (407) 648-6323 Jill.Kelso@usdoj.gov

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