A nationwide survey of bankruptcy judges and lawyers indicates that bankruptcy fraud is steadily increasing and negatively affecting corporations and individuals alike.

A survey by Kessler International found that 31 percent of bankruptcy judges, administrators, trustee, and lawyers polled, knew of "flagrant abuses" of bankruptcy laws in cases they have handled 63 percent stated they knew of some abuse and only six percent stated that they thought bankruptcy laws were followed and each filing was honest.

"This type of fraud drips down and affects the prosperity of corporate economies," said Michael G. Kessler, President and chief executive of Kessler International, a forensic accounting and investigative consulting firm.

Statistics from the American Bankruptcy Institute show that in the year 2000, over one and quarter million bankruptcy filings occurred. In the first quarter of 2001, bankruptcy filings were up to 366,841.