owe section 8 money, is this fraud?

[jturk]

i owned a property that was in pre foreclosure & quit claimed it back to the lender. it had a section 8 tenant, neither i or the lender (who was a private money lender) notified section 8 of the change in ownership.

so what happened was sec8 continued to send me rent but my account was in the negative so basically the money went to my bank account & ended up in a wash, that was the first month.

the money came a 2nd & 3rd month & my account was not in the negative so i withdrew the money & never returned it to sec. 8.

sec 8 is a govt. agency.

my question is am i able to include this debt in my ch 7 bk?

[music12]

this is not an easy question. you'll have to research case law to find out.

the good news is that sec 8 is not specifically excluded from discharge by sec.523 of the bk code. so to get you, they would have to actually file an AP and prove that you kept the money fraudulently. the definition of fraud then comes into play.

some of it will probably depend on what happened the 4th month - did they stop sending you the rent because you told them to (which would be good)? also, do you really owe this to the govt or to the entity that became the landlord? did sec 8 ever sue you for it or try to get it from you in some way?

i have to say that it sounds like you knew the money wasn't yours when you withdrew it from your account, which is not so good.

[frogger]

they would have to actually file an AP and prove that you kept the money fraudulently.

i have to say that it sounds like you knew the money wasn't yours when you withdrew it from your account, which is not so good.

Section 8 is aggressive about landlord payments and fraud. Never forget that you're dealing with the government who has more time and money than you do. If you get one the section 8 people with a bad attitude, you can bet your last dollar that they will be going after you.

You knew you were not entitled to the money, yet continued to take it. IMO, that is fraud, however that is just my opinion.