Creditors Beware: Please Follow The Laws When Filing Bankruptcy Proof of Claims. PART 2 of 2

22 Mar Creditors Beware: Please Follow The Laws When Filing Bankruptcy Proof of Claims. PART 2 of 2

In my last blog, I spoke about identity theft arising from proof of claims. This blog is a continuation of that article and contains a copy of the tentative ruling issued by the Judge for two creditors that broke the laws with respect to publishing identity information.

Last week, in the cases against First Future Credit Union and Keypoint Credit Union, the Honorable Judge Taylor issued sanctions to pay for the attorneys fees in restricting the claim from public access, and ordered damages to pay for a year of credit protection. She also demanded that First Future Credit Union institute policies and procedures to end these disclosures and present proof of the same in 30 days. In the event no proof is provided, she also issued a continuing sanction of $100 per day until there was compliance. Finally, she also recommended that they meet and confer with my office with a weeks time to address all the other improper claims they filed over the past 4 years. In the event that a resolution is not reached, she advised that my office may bring an order to show cause action against the creditor to address all the improper claims in a pseudo class action hearing.

Attached below is the minute order on the case.

KeyPoint Credit Union: Finding of Contempt; compensatory sanction $500.00, payable within 30 days of this court’s order.

First Future Credit Union: Finding of Contempt; compensatory sanction $1889.95; coercive sanction avoidable if evidence of corrective action timely provided, payable after 30 days of this court’s order. Decl to be filed within 30 days of this court’s order re: indentifying information.

Order to be prepared by Court.

The Court Order should be published next week and Ill post a copy of the same on this blog.  The Judge’s tentative ruling was two pages long, so it should make for an interesting order.

Anyways, so whats the bottom line? Creditors please follow the laws! Failure to do so will only cost you money!

For those that have filed for bankruptcy protection, make sure you review all creditor claims filed in your case. You may not get copies of these claims, so ask your attorney to produce them for you or make sure your attorney reviews them as well. Most attorneys do this as a matter of course, but its always wise to get a copy of the claim anyways since you might want to dispute certain claims or excess amounts that creditors are alleging.

Written by Michael G. Doan

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