Central District Consumer Bankruptcy Attorney's Association

As part of my final pre-signing interview, when we get to discussing Question 14 on the SOFA (Property held for another person), virtually every client says no. I then ask, is your name on any bank account for a child or elderly parent, where it's their money, but you are on the account as an accommodation? Many clients with children and some clients with elderly parents will then answer yes to this. This gets listed and explained in Section 14 of the SOFA.
Jim
James R. Selth
Certified Bankruptcy Specialist*
Weintraub & Selth, APC
11766 Wilshire Boulevard, Suite 1170
Los Angeles, California 90025
Telephone: (310) 207-1494
Facsimile: (310) 442-0660
E-Mail: jim@wsrlaw.net
*Certified by State Bar of California as Certified Legal Specialist in Bankruptcy Law

The post was migrated from Yahoo.

Although some of my best friends work in credit unions, they often are remarkably unsophisticated regarding bankruptcy procedures. My guess is that they are not freezing the funds in your client's account for the reason Wells Fargo does, but rather because your client has a loan with them and they are trying to offset the funds. Alternatively, I've seen credit unions close the accounts of members who file bankruptcy when there is an outstanding loan, and they will then send a letter to the member temporarily freezing the account and then sending the funds to the debtor.
Although the law permits a temporary freeze on an account to allow a financial institution to promptly file a Motion for Relief from Stay to offset (I've briefed this issue in the past), the credit union can clearly not freeze the funds indefinitely simply because a bankruptcy case was filed. You should send them a strongly worded letter demanding that the account immediately be unfrozen, or else a Motion for Sanctions for violating the stay will be filed. And then if the funds are not released, such a Motion should be filed. This can be done by Motion, and you can request payment of attorneys' fees, actual damages and punitive damages. Make sure to file a Declaration re fees and damages.
Jim
James R. Selth
Certified Bankruptcy Specialist*
Weintraub & Selth, APC
11766 Wilshire Boulevard, Suite 1170
Los Angeles, California 90025
Telephone: (310) 207-1494
Facsimile: (310) 442-0660
E-Mail: jim@wsrlaw.net
*Certified by State Bar of California as Certified Legal Specialist in Bankruptcy Law

The post was migrated from Yahoo.