A man from Hayward, Wisconsin, Bernard Seidling, has been found guilty of two counts of bankruptcy fraud and one count of criminal contempt of court. The conviction was reached after a four-day trial in federal court in Madison. The jury delivered the verdict following approximately five hours of deliberation. This announcement was made by Timothy M. O’Shea, United States Attorney for the Western District of Wisconsin.
“Fraud threatens the free and fair markets upon which our economy is based. Moreover, fraud against the Court—in this case, the Bankruptcy Court—has the potential to undermine public trust in the fairness of the courts. This case reflects my office’s commitment to prosecuting financial crime and protecting the integrity of the bankruptcy system,” said U.S. Attorney O’Shea. “I am grateful for our partnership with the U.S. Trustee’s Office and I commend our federal and state law enforcement partners, the FBI, the Wisconsin Department of Justice, and the U.S. Postal Inspectors.”
Michael Hensle, FBI Milwaukee Special Agent in Charge stated: “The FBI is unwavering in its commitment to holding individuals like Mr. Seidling accountable.” He emphasized that "criminal bankruptcy fraud threatens the integrity of our legal processes," reaffirming their dedication to bringing offenders to justice.
Seidling filed for bankruptcy in 2022 but falsely claimed he had no significant assets or multiple bank accounts when he actually controlled millions through various trusts and partnerships. Evidence presented included testimony from 25 witnesses and 115 exhibits showing his hidden assets.
In 2023, authorities searched Seidling's residence in Hayward and discovered over $100,000 in cash along with more than $4 million in uncashed cashier’s checks linked to business accounts payable to him.
Additionally, it was proven that Seidling misled both the bankruptcy court and trustee about his ability to participate due to alleged health issues while continuing his business activities and even playing tennis during this period.
Seidling also violated a November 2023 injunction that prohibited him from transferring or dissipating assets associated with his businesses by transferring real estate holdings and withdrawing funds from bank accounts.
Chief U.S. District Judge James D. Peterson has scheduled sentencing for June 11, 2025. Each count of bankruptcy fraud carries a maximum penalty of five years imprisonment; however, there is no maximum penalty for criminal contempt of court.
The investigation involved collaboration between several agencies including the Federal Bureau of Investigation (FBI), Wisconsin Department of Justice Division of Criminal Investigation (DCI), United States Postal Inspection Service (USPIS), as well as assistance from Office Of The United States Trustee with prosecution led by Assistant U.S Attorneys Meredith P Duchemin & Megan R Stelljes.