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 verdict was delivered after a four-day trial in federal court in Madison. The jury reached its decision following approximately five hours of deliberation. Timothy M. O’Shea, United States Attorney for the Western District of Wisconsin, announced the conviction.
“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,” stated U.S. Attorney O’Shea. He expressed gratitude for collaboration with various law enforcement agencies including the FBI and U.S. Postal Inspectors.
Michael Hensle, FBI Milwaukee Special Agent in Charge, remarked on their dedication to holding individuals accountable: “The FBI is unwavering in its commitment to holding individuals like Mr. Seidling accountable.” He emphasized that criminal bankruptcy fraud endangers legal processes.
Seidling's fraudulent activities came to light after he filed for bankruptcy in 2022, falsely claiming he had no significant assets or accounts beyond a single deposit account with $195. However, evidence presented by 25 witnesses and 115 exhibits showed that Seidling possessed millions in personal and business assets hidden behind trusts and partnerships.
In addition to concealing assets, Seidling misled the bankruptcy court by claiming physical and mental incapacity prevented him from participating meaningfully in his bankruptcy proceedings. Despite these claims, he managed his businesses and engaged in other activities during this period.
Seidling also breached a November 2023 injunction that barred him from transferring or dissipating assets associated with his businesses. Violations included real estate transfers and bank account withdrawals totaling over $1 million hidden at his residence.
Chief U.S. District Judge James D. Peterson has scheduled sentencing for June 11, 2025. Seidling could face up to five years imprisonment for each count of bankruptcy fraud; however, there is no maximum penalty for criminal contempt of court.
The investigation was conducted by several agencies including the Federal Bureau of Investigation and Wisconsin Department of Justice Division of Criminal Investigation with assistance from the Office of the United States Trustee. Assistant U.S. Attorneys Meredith P. Duchemin and Megan R. Stelljes are prosecuting the case.
