Category Archives: Bankruptcy

Consumer Bankruptcy News – Michigan

Bankruptcy blame and fraud dominate this week’s

Consumer Bankruptcy News - Michigan
Consumer Bankruptcy News – Michigan

Consumer Bankruptcy lawyer News – Michigan.

Bankruptcy Lawyers Get Blamed – By The Judge

We get blamed by our clients all the time, but

getting blamed by the bankruptcy judge is much worse.

More fundamentally, the court is disappointed in Martell’s counsel for attempting to disallow a claim for trumped-up and technical reasons when the claim itself raises no substantial issues as to its validity and counsel knows that the small amount of the claim makes it uneconomic for the creditor to assert its rights. While some parts of the Bankruptcy Code may require rights to stand or fall on minor technicalities, claim allowance is not one of them. Rather, a debtor’s over-reliance on non-substantive objections to claims may be evidence of abuse of the bankruptcy process.
Gee, lawyers are supposed to be technical, and, zealous advocates for our clients.  I am sure it was news to this bankruptcy debtor attorney that “ claim allowance is not one of them”.  It is news to me.
Not the only bankruptcy lawyer misconduct this week.

Attorney’s Failure to Conduct Reasonable Investigation of Debtor’s Income & Expenses Led to Dismissal of Case & Sanctions against Lawyer

Now, this one I get.  Bankruptcy court is a federal court, with a duty on the attorney to reasonably investigate before filing a lawsuit, or a bankruptcy.

The bankruptcy system is like the income tax system, the integrity depends on accurate self reporting, whether on tax returns or bankruptcy schedules.

We bankruptcy lawyers have to get documentation on income and expenses, and assets and liabilities.

The trustee, or U. S. Trustee, has to file a motion to dismiss if someone is making too much money to be in a Chapter 7.  In this case, the Court found that reasonable investigation by the debtor attorney would have resulted in the case not being filed, and the trustee not incurring the costs of moving to dismiss the bankruptcy case.

Bankruptcy Lawyers Get Blamed – By The Debtor-Client

Ahh, the old-fashioned excuse still is used.  “My bankruptcy lawyer did that!

I told him about the house in the Bahamas and the gold bullion in the basement and the cash in the safety deposit box.”

Sure, it does happen, but are there less reliable folks than Cook County politicians?

A former chairman of the Illinois Prisoner Review Board is suing his onetime bankruptcy attorney for allegedly under-reporting his state salary and forging his signature on bankruptcy documents, which he said cost him his job with the board.

This debtor may have a point, as his lawyer was suspended from practice for filing inaccurate stuff.

Get an attorney who is reliable, preferably certified, and always read any legal papers you sign and keep copies made when you sign.

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Consumer Bankruptcy News

Consumer bankruptcy filings are sure to go up. Mortgage debt is one reason.  The government just keeps pushing out mortgages to people who cannot otherwise get them.  Those with lower credit scores and income. Which people, of course, default more often. People who cannot pay their debts are the ones who file bankruptcy. Mortgage DebtContinue Reading

What Is The Automatic Stay?

Automatic Stay Stop Debt Collection

The automatic stay is imposed, well, automatically, upon the filing of any bankruptcy petition. It is a big red STOP! sign to ALL creditors that debt collection actions, garnishments, foreclosures, repossessions, letters, phone calls, anything, must stop. Most courts can issue a stay, an order freezing things where they are, after a lawsuit is filed, andContinue Reading

More “Debt Relief” Lawyers Shut Down

The Consumer Protection Finance Bureau (CPFB) nailed some debt relief lawyers for FRAUD in tricking consumers into parting with their money for “debt relief.” Which turned out to relieve them only of their money and enrich the debt relief lawyers in the firm. What Is Debt Relief? Debt relief lawyers, and other scammers, use scareContinue Reading

More Debt, More Debtor Harassment

More consumer debt always leads to more bankruptcy filings. Does more debt lead to more debtor harassment? The November data are in, and, yes, consumer debt, that month of big Christmas shopping, went way up. Having read the latest Consumer Protection Financial Bureau consent judgment against a debt collection law firm, I wonder if there isContinue Reading

Bankruptcy and Interest Rate Increase

The Fed increased interest rates 25 basis points,   that is, .25%, and, the banks followed along. Lots of consumer credit is tied to “prime” rates set by banks. Which uniformly go up when the Fed raises its rate, which is why the Fed raises that rate. How Much Consumer Credit Is Tied To PrimeContinue Reading