Snyder v. Dykes, No. 18-3557 (8th Cir. 2020)
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After debtors filed a voluntary petition for relief under Chapter 7 of the Bankruptcy Code, the United States Trustee objected to the discharge in bankruptcy. The Bankruptcy Appellate Panel (BAP) affirmed the bankruptcy court's denial of discharge.
The Eighth Circuit affirmed and agreed with the BAP that the bankruptcy court did not err in denying debtors a discharge in bankruptcy under 11 U.S.C. 727(a)(3) based on its findings that debtors unjustifiably failed to keep adequate records of financially significant watch and jewelry transactions. In a consumer bankruptcy, the debtor has a greater duty to keep records of a sudden and large dissipation of assets. In this case, debtors' return of twenty-seven valuable watches and the Kwait bridal collection ring to a judgment creditor was such a sudden and large dissipation of assets.
Court Description: [Loken, Author, with Grasz and Stras, Circuit Judges] Civil case - Bankruptcy. The bankruptcy court did not err in denying debtors a discharge based on debtors' failure to keep adequate records concerning hundreds of thousands dollars worth of transaction on high-end watches and jewelry; debtors failed to justify their failure to keep adequate records of these transactions which had a significant impact on their financial situation.
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