summons for FRAUD!

[outoffunds]

I had posted a bit back about how my lawyer said it was alright to put her amt on a credit card that we were leaving out of the petition. We also had other charges on that card. I now received a summons to appear in crt for fraud? I am sick to my stomach and just want this done. The lawyer now won't help us since she has said she is forced to be on the creditors side so we are now on our own. Is it wise to call the opposing lawyer and just ask if we can agree on a settlement instead of taking this to court or am I just panicking please help.

[brokejoker]

They probably want the money you charged on the card after you knew you were filing for BK. I'd add up how much that amount is and call and see if you can settle for close to that. If you can't settle you're probably going to end up owing close to that amount anyway (plus fees) so just start preparing for that now.

[enuffznuff]

Aren't all unsecured debts discharged regardless of if they're listed? Shouldn't your attorney have known that?? what the heck...why would a bk attny suggest you put their fee on a credit card?? Most absolutely won't take credit card payments from the debtor that is filing, I thought?

[ccsjoe]

I remember your case. I couldn't believe it when you told us the attorney told you to charge her fees to your cc. Do you know what the claim is for? Is it for the attorney fee? If so, brokejoker is probably right in that you need to be ready to pay, however I'd hate to think you have no recourse against counsel since you were acting on her advice AND have the receipt printout from her office showing the charge.

[HHM]

A big red flag for hiring an attorney, if a BK attorney says you can put your BK attorney fees on a credit card, run.

As to your question, as to fraud complaint; yes, you can contact the opposing attorney and try to work something out.

Also, I would contact the State Bar and report the attorney.

A couple issues pop out.
1. You cannot "leave out" a debt from your petition. Part of your duty under the BK code is to disclose ALL claims
2. No Bk lawyer should "knowingly" accept credit card payments for BK. That creates a huge potential conflict of interest and the lawyer is assisting you in the perpetration of a fraud (that is, using debt with the express intent to file BK).

[october99]

A big red flag for hiring an attorney, if a BK attorney says you can put your BK attorney fees on a credit card, run.

As to your question, as to fraud complaint; yes, you can contact the opposing attorney and try to work something out.

Also, I would contact the State Bar and report the attorney.

A couple issues pop out.
1. You cannot "leave out" a debt from your petition. Part of your duty under the BK code is to disclose ALL claims
2. No Bk lawyer should "knowingly" accept credit card payments for BK. That creates a huge potential conflict of interest and the lawyer is assisting you in the perpetration of a fraud (that is, using debt with the express intent to file BK).

I would definitely report the attorney. This at least deserves a reprimand.

And why won't your attorney help you now? All you did was act on their advice.

[outoffunds]

thanks all of you. She said she won't work with us now because it is a conflict of interest and she is *forced* to be on the creditors side. As far as the other charges there were charges before we filed but those were before we even decided to file but I think probably within the months for groceries etc so I would have to explain them. I am going through alot health wise at the moment and would like to have this behind me to focus on the other if there is a way to contact that lawyer and work something out I would like to but I did not know if it was wise to do that on our own or how to do it. As far as the other lawyer yes I should do something I just do not know what yet I am just afraid and want to move forward from this. I have learned many, many lessons and this is the hardest yet. ugh! Thanks for the responses

[backtoschool]

90 days before filing for bankruptcy is considered the legal definition of insolvency. If you use your cards when you know you are insolvent, (ie within 90 days) then for bankruptcy purposes that is considered fraud. The creditor does not have to prove fraud, they simply have to show that you made the charge within 90 days before filing and that the charge was for an item that was optional. Paying for a bankruptcy lawyer with a credit card is definitely fraud (in the bankruptcy sense of the word, no judgmental tone here, just using the bankruptcy terminology) because if you are hiring a bk lawyer, then you know you are insolvent and should not be putting charges on the card.

The likely scenario is that the contested charges will not be dischargeable if you lose the AP.

[IBroke]

This certainly is fraud. So the attorney gives this advice AND thinks it's none of her business after she collected the money? Accepting a CC for her own fees and telling you she "won't work with you now because it is a conflict of interest and she is *forced* to be on the creditors side" is the perfect definition of fraud. If she can't work for you now (what a surprise..), is she willing to return the money to you? If not, again, I'd call it "fraud".

Your attorney fees were ONLY charged to the card due to the EXPLICIT advice of the attorney. Everybody with basic knowledge in the BK-field knows what's going to happen. It's either not dischargeable or a preferential payment if you pay it off prior to filing. There is no other way out. And I should believe that this caught the attorney by surprise? Yeah, sure...

If you ask me, this "lady" belongs behind bars.

[despritfreya]

Your attny needs to be disbarred and you can quote me (an attorney) on that one. She has put you in the position of defending a 523. She needs to represent you or indemnify you for her poor if not improper advice. Tomorrow contact your State Bar to find out the procedure for filing the Complaint. Tomorrow contact the attny for the creditor and settle the matter. Normally the creditor will put you on a payment plan. During the conversation get a "stand still" agreement (confirmed in writing) that pending settlement you do not need to file an Answer.

Best of luck.

Des.

[redhunter]

I've seen where the trustee will sue the debtor's attorney where there is a case malpractice. The trustee will claim that the estate lost money due to his/her incompetence and try to collect some settlement usually from the attorney's malpractice insurance coverage.

[geye]

Why didn't the attorney just reverse the charges? This whole thing doesn't make sense.

[tobee43]

A big red flag for hiring an attorney, if a BK attorney says you can put your BK attorney fees on a credit card, run.

As to your question, as to fraud complaint; yes, you can contact the opposing attorney and try to work something out.

Also, I would contact the State Bar and report the attorney.

A couple issues pop out.
1. You cannot "leave out" a debt from your petition. Part of your duty under the BK code is to disclose ALL claims
2. No Bk lawyer should "knowingly" accept credit card payments for BK. That creates a huge potential conflict of interest and the lawyer is assisting you in the perpetration of a fraud (that is, using debt with the express intent to file BK).

call your state bar and let them know what happened immediately...also respond to the summons....get another atty immediately....if NOT sooner!!!!!

any atty handling banktrupcy knows you cannot pay with a cc...any...period. this atty has comprised your standing with the court and i would take it to task..

i know it's an..... what appears to be a HUGE bump in the road...but i really think it will be resolved. just get yourself a REAL atty this time....asap...and have the summons answered.

[keptdigging]

This is really quite stunning. Charging your bk attorney's fees on a credit card is the clearest cut "incurred without any intention of repaying" imaginable. You can't even make up a bs story like "really planned on paying back but they changed my mind the next day"!

It's shocking behavior for the attorney.

On the other hand, when you say this CC was "left out of the petition" it sounds like you meant to pay it anyway. That's not how the petition is supposed to work, but... all that you're risking on the use is non-dischargeability of that charge. You were expecting to not discharge it, right?

So as a practical matter, you contact the opposing counsel and see if you can agree that just THAT charge is non-dischargeable. Which is what you expected.

(Then I'd report your attorney to the bar.)
====

One problem here is the word "fraud". I can think of 3 distinct legal meanings here, and I'm not even an attorney.

1. There's the traditional crime/tort of "fraud" (presumably a very bad thing but I'm not a lawyer and can't define it.)

2. There's the crime of "bankruptcy fraud," basically willfully lying on your petition to hide assets, etc. It is a serious federal offense which carries both jail time, and the "bankruptcy death penalty": a complete and permanent denial of discharge (meaning you owe everybody everything including all the interest, penalties and costs specified in the loan agreements.) Which one would imagine will have run up quite high by the time you're out of prison.

3. And then there's the much less serious concept we're talking about here "charges incurred fraudulently" or something similar, basically meaning you didn't intend to pay them back when you made them. The 70 & 90 day rules, etc. all relate to this. Here only the specific charges involved become non-dischargeable.

You're dealing with #3 and it's much less serious than 1 or 2.

[IBroke]

One problem here is the word "fraud". I can think of 3 distinct legal meanings here, and I'm not even an attorney.

1. There's the traditional crime/tort of "fraud" (presumably a very bad thing but I'm not a lawyer and can't define it.)

2. There's the crime of "bankruptcy fraud," basically willfully lying on your petition to hide assets, etc. It is a serious federal offense which carries both jail time, and the "bankruptcy death penalty": a complete and permanent denial of discharge (meaning you owe everybody everything including all the interest, penalties and costs specified in the loan agreements.) Which one would imagine will have run up quite high by the time you're out of prison.

3. And then there's the much less serious concept we're talking about here "charges incurred fraudulently" or something similar, basically meaning you didn't intend to pay them back when you made them. The 70 & 90 day rules, etc. all relate to this. Here only the specific charges involved become non-dischargeable.

You're dealing with #3 and it's much less serious than 1 or 2.

Well, if the attorney suggested the CC-charge AND is claiming that she can all of a sudden "not help the client any more" after she collected her fees, I'd consider it to be Nr. 1.
What was this attorney smoking?