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THE CONSUMER BANKRUPTCY LETTER |
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In This Issue:
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August 9, 2004
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DISCHARGING TAXES MADE SIMPLE!
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LARGE FEES CORRUPTING BANKRUPTCY SYSTEM?
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TILA VIOLATION VOIDS MORTGAGE
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KING BANKRUPTCY ACADEMY
THREE SEMINARS ON DISCHARGING TAXES - LAS VEGAS, SAN FRANCISCO & SAN ANTONIO
The first dates scheduled for the 5th annual 3-day Bankruptcy Academy on discharging taxes in bankruptcy cases have been scheduled for -
LAS VEGAS, Nevada, on Sept. 8, 9 and 10, 2004;
FISHERMAN'S WHARF, S. F., on October 27, 28 & 29, 2004,
SAN ANTONIO, Texas, January 27, 28 & 29, 2005.
Additional 2005 dates are pending for Atlanta, Georgia, and Boston, Mass.
Principal presenters will be; Morgan King, attorney and author of Discharging Taxes in Bankruptcy; Charles F. Rosen, former chief of the Los Angeles IRS office of Special Procedures (bankruptcy, insolvency); Eric M. Casper, formerly Senior Trial Attorney, Tax Division, U.S. Department of Justice - Washington, D.C.; and Robert N. Kolb, formerly with the IRS and recently the prevailing attorney for the debtor/taxpayer in two important appellate cases. Also appearing - enrolled agents Jerry Satterberg and Bobby Covic.
The 3-day seminar and workshop will be a thorough exploration of bankruptcy remedies for delinquent taxes and tax liens in consumer bankruptcy cases (chapter 7 and chapter 13), emphasizing practical handlng of tax discharge cases from A-to-Z.
CLE ACCREDITATION
Previous programs have qualified for CLE in all states for which CLE accreditation was requested. The Academy is applying for attorneys' CLE accreditation in all states for which CLE is mandatory.
CPE accreditation from the IRS for enrolled agents has been approved.
TUITION
Single attorney registration for Las Vegas - $695
Single attorney for Fisherman's Wharf or San Antonio $645
Double attorney registration any location $995 (saves $400!)
Paralegal or other office staff any location $350
Enrolled agent or CPA any location $495
For more information about the Tax Discharge program, or to enroll, click on red below or call (925) 829-6460 west coast time.
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COUPLE INDICTED FOR BANKRUPTCY FRAUD
SCOTTSDALE - The U.S. Attorney's Office indicted a local couple on charges of bankruptcy fraud, alleging that they used the money they owed to purchase a $305,000 Scottsdale home.
The indictment alleges Andrew Taylor, 50, and his wife Sandee, 44, filed five voluntary bankruptcy petitions over a six-year period without the intention of repaying the money they owed.
The couple failed to disclose they had previously filed bankruptcy, officials said. The couple also failed to reveal some of their assets, such as bank accounts and a title to an aircraft, said Sandy Raynor, a spokesperson for the U.S. Attorney's Office in Phoenix.
The Taylors are also indicted on charges of concealment of assets and false declarations in a bankruptcy proceeding. The Internal Revenue Service was one of their creditors and conducted the investigation with the assistance of the office of the U.S. Bankruptcy Trustee.
Jordana Mishory
The Arizona Republic
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CREDIT CARD SOLICITATIONS SHARE BLAME FOR MIDDLE CLASS BANKRUPTCY
Last year, there were more than 1.6 million bankruptcy filings, compared with 875,000 a decade earlier. Some experts say much of the increase is being driven by older people, many of whom have decades of work experience in white-collar jobs.
The Consumer Bankruptcy Project, which surveyed 2,400 bankruptcy filers in 2001 and 1991, found that on a per capita basis, older people are now the most likely to file. In 2001, for instance, per capita filings of individuals ages 45 to 54 increased 58%, to 11 per thousand, according to the study. "The curve is moving to the right," says Elizabeth Warren, a professor at Harvard University Law School, who co-authored the study. "It reflects a more frightening reality for a wide swath of middle-class America."
Many of today's bankrupt baby boomers simply weren't as frugal as their Depression-era parents. But the increase in middle-age people filing for bankruptcy also is attributed to soaring medical costs, an unstable job market and years of aggressive credit-card marketing. The number of credit-card solicitations in the U.S. grew to 4.29 billion in 2003, from 1.52 billion a decade earlier, according to Chicago research-firm Synovate Inc.'s Mail Monitor service. Last year, Federal Reserve data showed total revolving consumer debt at more than $734.1 billion, compared with $238.6 billion in 1990.
Ben B. Floyd, a personal-bankruptcy trustee in Houston for the past 30 years, says he's now seeing people "who obviously had a white-collar background. They come in looking lost." Personal-bankruptcy lawyers across the country say they've witnessed a tidal shift in their practices, seeing older clients with longer work histories. "These people didn't take their credit cards to Atlantic City," says Gabriel Del Virginia, a New York bankruptcy attorney. "It's largely because people lost their jobs or had a catastrophic illness."
Suein Hwang
Staff Reporter of THE WALL STREET JOURNAL
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CONSUMER SPENDING SEES BIG DROP
WASHINGTON - American consumer spending dropped 0.7 percent in June, the steepest monthly fall since September 2001, the government reported Tuesday. With income growth stalling as well, the numbers raised new concerns about the strength of the economic expansion.
Overall personal income — which includes wages, salaries and income from dividends, interest, rents, self-employment and other sources — rose by 0.2 percent in June, the slowest monthly increase in more than a year, the Commerce Department reported.
But personal income was flat after adjusting for inflation and taxes, the report showed. Wages and salaries fell after adjusting for inflation.
Washington Post
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FAILURE TO DISCLOSE POTENTIAL CONFLICT OF INTEREST DOES NOT AUTOMATICALLY RESULT IN DISQUALIFICATION OF COUNSEL
Inadequate disclosure does not mandate disqualification of counsel. Rather, the appropriate remedy is left to the broad discretion of the court. See, e.g., In re Best Craft Gen. Contractor and Design Cabinet, Inc., 239 B.R. 462 (Bankr. E.D.N.Y. 1999). In this case, the disclosure was made at the outset of the case to the United States Trustee and formal disclosure was later made. Also, as noted, the prior disclosure to the United States Trustee is indicative of a lack of intent to conceal. Further, as discussed in the next session, this is not a case where full disclosure would have revealed an actual conflict. Rather, full disclosure would have alerted all parties to facts that should have been known but which, in the end, do not bear upon Paul Hastings' qualification to serve as counsel. For these reasons, the Court will not now disqualify Paul Hastings for its previous failure to disclose.
IN RE NORTHWESTERN CORPORATION, (Del. 2004)
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DEBTOR'S PREPETITION DEPOSIT FOR KIDS COLLEGE TUITION IS NOT PROPERTY OF THE ESTATE
Alabama Debtors invested $14,636 in their son's and daughter's prepaid tuition program. Because the payments were characterized as "prepaid" tuition, the funds belonged to the children, not the debtors when the debtors filed bankruptcy.
in re Cheatham (Bkrtcy.MD 2004)
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COURT INVALIDATES DEBTORS' MORTGAGE FOR TILA VIOLATION; DEBTOR MAY PAY LOAN THROUGH CHAPTER 13 PLAN
Truth In Lending Act, 15 USC § 1601 et seq.
Debtors allowed to rescind their mortgage under the Truth in Lending Act for alleged prepetition predatory lending practices. The debtors may repay the remaining allowed unsecured claim owed to the lender, through their plan, over a period of time no longer than the life of the plan.
The court found that the debtor is entitled to rescind the loan because she was not given notice of her right to rescind as required by TILA. Debtor was also awarded damages and attorney's fees for violations of TILA and other statutes.
In re Bell, Bell v. Parkway Mortage (Bkrtcy.E.D.Pa. 2004).
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ATTY MUST DISGORGE CHAPTER 7 FEES PAID BY HIS CHAPTER 13 CLIENT
Chapter 13 debtor was mother of a daughter and son-in-law in Chapter 7. The mother paid attorney the fees for their Chapter 7. Attorney failed to disclose receipt and source of payment of the Chapter 7 fees.
Lewis v. Mozelle S. (Bkrtcy.N.D.Okla. 2004).
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HOW FILING BANKRUPTCY MADE ME A BETTER PERSON
When I filed bankruptcy, it made me take a good, hard look at myself. I discovered some important truths about myself, life, and the meaning of everything. And, I'd like to share some of those precious insights with you.
These are some of the things I learned:
1. Throwing away my own money is not as fun as throwing away everyone else's money.
2. I must stop blaming others for my problems and assume full responsibility for my actions, except the ones that are someone else's fault.
3. Having control over myself is not as good as having control over others.
4. I need not suffer in silence while I can still moan, whimper, and complain.
5. I am at one with my duality.
6. I am willing to make the mistakes if someone else is willing to learn from them.
7. Before I criticize a creditor, I should walk a mile in his shoes, and then run like hell. That way, I can see things from his perspective, be filled with compassion, and if he's a slow creditor, keep his shoes.
8. I love the trustee. He was more interested in me than anyone else has been in my whole life. We had a meeting where we played a really fun game, “Let's All Look For The Hidden Money.” Then, at the end of the meeting he gave the sign of the cross and told me I was forgiven (actally, he said i was excused. Same thing). I was so moved I broke down and cried in the hall.
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PUBLISHED BY KING BANKRUPTCY MEDIA FOR BANKRUPTCY PROFESSIONALS 7080 Donlon Way Suite 222 Dublin California 94568 (925) 829-6460
© King Bankruptcy Media 2004 CONTACT US AT editor@bankruptcymedia.com
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