May a Jew escape debt by declaring bankruptcy?

16.07.2011                      14.Tammus, 5771                      Pinchas

Frag den Rabbi:

May a Jew escape debt by declaring bankruptcy?

Modern bankruptcy statutes usually aim to protect the debtor while still recompensing creditors (at least partially).

Declaring bankruptcy is a morally complex action since it allows one to delay or avoid paying money rightfully owed to others. At the same time, it prevents debtors from being abused or taken advantage of by their creditors.
Modern bankruptcy statutes usually aim to protect the debtor while still recompensing creditors (at least partially). Yet some countries, including the United States, have recently enacted stricter bankruptcy laws to prevent fraudulent claims and repeat offenders. This attempt to protect both debtors and creditors is also found in classical Jewish law, albeit in a different manner….