Blog


Posted May 2017

Still providing personal service to our clients at our local office in Holland, Michigan.  You will see the attorney, who will take particular interest in your case and your financial situation.  The first consultation is no charge.

Posted February 2017

UIA data security incident and recent settlement re: fraud claims

It was bad enough that the State of Michigan was wrongfully accusing unemployment applicants of fraud, but it now appears that personal information of applicants in the possession of the State was compromised. Data was exposed from October 10, 2016 to January 30, 2017. It did not include addresses, birth dates or phone numbers, but it could have included the social security numbers and names of up to 1.87 million people.

Here is what the State says about the data breach:

A. This happened because of a software update.

B. Information could have been seen by workers from any of 31 companies with ties to the State computer system for a period spanning more than three months.

C. The general public did not have access.

D. The breach was discovered on January 30, 2017 and a fix was applied the same day.

E. The State will send a notice to each person whose information was compromised. See below for what you can do in the meantime.

Now, for some good news.

On February 2, 2017, the State of Michigan settled a lawsuit over the its administration of unemployment (“UIA”) benefits over the last few years.

History: The State left the UIA process up to a $47-million computer system called Michigan Integrated Data Automated System (MiDAS), which now seems to be replaced by Michigan Web Account Manager (MiWAM). This caused thousands of wrongful accusations and determinations that people were fraudulent in getting unemployment benefits in Michigan since the Great Recession and before. (Apparently, even though MIDAS was started in 2013, it looked back to previous years to question UIA claims.) Furthermore, the State then followed these people into bankruptcy court, again alleging fraud, damages of 4 times the amount of benefits received and judgments that the debts survive the bankruptcy discharge.

The recent settlement was in a lawsuit brought in federal court seeking that the State stop these practices, but not seeking monetary damages. Here is what the settlement does, according to news reports:

1. The State acknowledged the failure of the MIDAS system.

2. The UIA must take real steps to make sure there is a basis to suspect fraud before taking further action against a claimant.

3. Collection activities, including wage garnishments and seizure of income tax returns, will cease for claimants who received fraud determinations during the relevant period.

4. More due process safeguards and procedures will be put in place at the UIA.

5. Additional reporting will be required to inform plaintiffs about the progress of the review and new fraud determinations over the next two years.

The state had already agreed to a separate order suspending collection activity against unemployment claimants accused of fraud between Oct. 1, 2013, and Aug. 7, 2015, unless the cases were individually reviewed by a human and affirmed with a new notice to the claimant. The UIA has also reversed computer-based determinations in 20,965 of 22,427 cases during an initial review and has so far refunded claimants $5.4 million. The state is now reviewing another 28,000 fraud determinations from the same period that it says involved both computer and staff, a process expected to take six months. I will be seeking information to see how this affects people with judgments for non-dischargeability in bankruptcy court. I am aware that our local bankruptcy judges are aware of these problems and are taking responsible steps to review these matters when the come before them.

What can you do if you received UIA benefits since 2007:

1. Check your file with the UIA. If you can still log into the system, do so and see if they have accused you of fraud. News reports indicate that some people don’t know that they have been accused. They think that their file is closed and have not checked it recently. The website for the UIA is:

http://www.michigan.gov/uia/

2. The UIA is asking those who think they were affected by the fraud issues to call the state’s new hotline, 1-800-638-6372.

3. For the data breach issues, call 1-855-707-8387. Everyone is entitled to a free credit report once a year, in order to see if they are a victim of identify theft. The website to get a free report is: https://www.annualcreditreport.com and the toll free number is: 877.322.8228. You should check your credit report to see if your identity was stolen.

4. The UIA asks that you keep your contact information current with them. If you do not, you do run the risk that they may send something and you will miss it. Here is where to go to update your contact information:

http://www.michigan.gov/documents/uia_1925_86468_7.pdf

5. Always read your mail. If you do not understand what an official agency just sent to you, seek help to understand it.

6. Never let an accusation against you that is untrue go unanswered. If you are not sure how to respond to an accusation, get some help, from an experienced attorney if necessary. Most challenges to these fraud determinations win the day. So, it is worth your time to deny and answer.

7. Be very careful in providing information when applying for any public benefits (or anything, really). Keep a copy of what you send to anyone, so that you can prove later what you sent, said or did.

8. There is still a class action lawsuit pending against the State for these problems. This lawsuit seeks damages for people affected by the UIA mess. See websites on that lawsuit, including: http://uiafraudclassaction.com/ .

http://uiafraudclassaction.com/

None of this is a replacement for specific legal advice for your situation. If you need help on financial legal problems, call Lakeshore Bankruptcy Center at 616.396.2124. We will sit down with you and look at your situation and then review your legal options with you.

Posted January 2017

Happy New Year to all!

I have been training to update my knowledge base on student loans and income taxes in bankruptcy.  These are crucial topics for people in financial trouble.  As always, I strive to learn about the latest legal developments in these areas, so that I can be helpful to someone who comes in for advice.

Posted October 2016

I recently attended a full day update on Chapter 13 work.  Lots of good ideas were discussed there.  I really appreciated it.

Posted July 2016

The FAQs below provide general information regarding common bankruptcy questions and are not intended to provide you with specific legal advice. Your situation is unique and should be reviewed with an attorney. We can meet with you for no charge in an initial conference and provide you with legal advice and recommendations for your specific situation.

What is chapter 7?

Chapter 7 is liquidation. The effect is to pledge all of your property to the bankruptcy estate. If you cannot fully exempt an item, the trustee appointed to the case will sell it and pay creditors with the proceeds.

The key here is to find out if your property is exempt. This can be a simple process, but sometimes is complicated and depends on your particular situation. Usually, we at the Lakeshore Bankruptcy Center can give you a good idea in a first conference for no charge about whether you will lose property in a chapter 7 bankruptcy.

Chapter 7 usually lasts from 4 to 6 months and involves often only one “hearing”, the meeting of creditors. Depending upon the case, there might also be work with secured or other creditors along the way, or other work. At the end, you get your discharge, which permanently keeps creditors from collecting the debts you had when you filed (except for debt which are non-dichargeable).

What is chapter 13?

Chapter 13, called adjustment of debts, is a payment plan. You pledge your paycheck or income to a trustee who then pays creditors with that money. There are other variations of paying debt in a chapter 13, but usually it involves regular payments to the trustee.

People usually consider chapter 13 when they would lose property in a chapter 7, they have more income than expenses, or they could get some other advantage through 13.

Chapter 13 usually lasts from 36 to 60 months and involves at least 2 “hearings”, the meeting of creditors and the confirmation hearing. It is more complicated than chapter 7, but often provides more benefits, especially with secured creditors.

At the end, you get your discharge, which permanently keeps creditors from collecting the debts you had when you filed (except for debt which are non-dichargeable).

What is the meeting of creditors?

The meeting of creditors, or 341(a) meeting, is a mandatory appearance for all people who file bankruptcy. The trustee appointed to your case runs this meeting and asks many questions under oath. The trustee will need to know that you have been completely truthful in your bankruptcy papers and, in chapter 13, will review your plan for any problems. Creditors can come and ask you questions, too.

Many people are nervous about the meeting of creditors. We at Lakeshore Bankruptcy Center know how to get you prepared for the meeting of creditors, so that you will be as comfortable as possible. Marcia is a chapter 7 trustee herself and examines debtors at meetings of creditors all the time, so she has a good idea of what you could be asked to explain at your meeting.

Who is the trustee?

The trustee is a person appointed to administer the bankruptcy estate for the creditors.

In chapter 7, the trustee is looking to see, among other things, if your property is exempt or if it can be sold to pay creditors. In chapter 13, the trustee collects regular payments from you and distributes funds to creditors as your plan provides.

Trustees have many other duties, which we will explain to you if you decide to go forward with a bankruptcy.

Call us at 616.396.2124. 

 

Posted April 12, 2016

Effective April 1, 2016, certain dollar amounts in bankruptcies were revised upward. This includes amounts which you can claim in a bankruptcy to exempt property from being taken by a trustee for administration and ultimate distribution to creditors.

The Bankruptcy Code provides for an automatic 3-year adjustment of dollar amounts to keep current with the Consumer Price Index. Here a few of the exemption changes:

Homestead exemption: From $22,975 to $23,675 per debtor
Vehicle exemption: From $3,675 to $3,775 per debtor
General exemption: From $1,225 to $1,250 (plus 1/2 of the unused homestead exemption) per debtor

There are many other changes with this adjustment. For the exemption changes, this means that you can keep more value in assets under the Federal Bankruptcy exemptions.

We at the Lakeshore Bankruptcy Center keep track of such changes and have already updated our software so that we can seamlessly claim these higher amounts for clients in our cases. Contact us for a free initial consultation.

616.396.2124

 

Posted February 21, 2016

I see that the situation with unemployment claims in Michigan has become an issue for a number of people. It seems that the problems are caused by automated unemployment insurance fraud detection system that began in 2013 under Michigan governor Rick Snyder, according to news reports. The system is called Michigan Data Automated System (Midas), an unfortunate acronym, in my view. It appears that many decisions in the unemployment process, including fraud determinations, were turned over to this automated system.

I find this very scary. Such decisions affect people’s lives dramatically. I believe that this has caused the wrongful determinations against many people in Michigan that they received unemployment benefits by fraud. These determinations are burdening these people with huge claims for money due that they will never be able to pay. Apparently, the State is collecting on these claims with garnishments and probably other ways, really hurting people. While there are recent reports that the State may be backing off of this system, I, as a bankruptcy trustee, am still seeing complaints by the State to except such claims from the bankruptcy discharge, which means that the person in bankruptcy will owe on the claim, even thought they sought relief in the bankruptcy court.

What should you do if you get a communication from the UIA or other office at the State of Michigan about your claim for unemployment benefits? First, read it very carefully. If you do not understand it, get help from an attorney. Second, do not ignore what you read in the notice. If it says something that is not accurate, respond in a timely manner to challenge it. Never let them say you did something you did not do, or did not do something you did do without your challenge. Do not assume that, because the notice is from the State, that it is correct or complete. An unsupervised automated system is bound to have these kinds of problems and no none should just let it go and hurt people.

616.396.2124

 

 

Posted January 3, 2016.

I have seen troublesome developments for people who make claims for unemployment benefits in Michigan. There is a surge of claims by the State Unemployment Insurance Agency (UIA) that people receive unemployment benefits by fraud. If you are found to have done this, then you will face:

1. A claim for damages that are 4 times the amount of the benefits which you received. (If you received $3000 of benefits, a finding of fraud will cause penalties of $12,000, plus the original $3000 for a total of $15,000!)

2. A claim that this is “bankruptcy-proof”. Fraud is non-dischargeable in bankruptcy if the plaintiff files a complaint by a deadline during the bankruptcy and proves their case. The State of Michigan filed these complaints on a regular basis during 2015 and there is no indication that they are going to stop this going forward. They obtained judgments against people for many thousand dollars in these cases.

Obviously, this has disastrous consequences for people who have the least ability to bear them. I have been reviewing the unemployment claim process and its relationship to the bankruptcy process and have a few preliminary tips for those involved in the unemployment claim system:

1. Understand the qualifications for unemployment benefits. You deserve unemployment benefits if you:

A. Are unemployed. If you recently lost a job, this will depend upon why and how the job loss occurred.
B. Are able and available for work.
C. Are actively seeking employment. Register for work at at http://www.mitalent.org and visit a Michigan Works! Agency (MWA) service center.
D. Your wage history means that you qualify for benefits.

2. Once you open a file for benefits, keep your address current with the UIA and read everything that they send to you.

3. If they send you a notice of denial or anything that is not accurate, learn what you have to do to defend yourself. Any notice should be sent to you with information on how to respond, but, if it is not, find out. Read the notice fully. Check out the UIA website (see below), or see an attorney. Bring all of the documents connected to the matter to the attorney so that the attorney can review them with you at your first meeting. That means that you should keep all the letters and other things you receive and send connected with your application for benefits.

4. Once you learn your process for getting what you want (or to defend against something not accurate), don’t let any deadline pass without taking the action required to get your benefits or defend yourself. Attend every hearing set on your matter. Do let them “default” you into something that is not true or fair. Keep a record of what you sent, when and how. When you send them something, keep a copy for yourself.

It is particularly important to object to any finding or statement that you fraudulently claimed unemployment benefits. This is a serious charge for many reasons and it can cost you tons of money that you may not be able to escape through bankruptcy. If you are charged with fraud, you will most certainly need the help of an attorney. We at the Lakeshore Bankruptcy Center can help you.

Here are some useful website addresses to consider:

Main State website

Online Claim Filing Kit

Guide to Unemployment Insurance Appeal Hearing

FAQ re: fraud from the UIA

Please call us for help.  616.396.2124.

Posted November 29, 2015

I just revised my office forms to work with the new Official Bankruptcy Forms which are mandatory, effective December 1, 2015. This is a change to almost all of the documents required to be filed for bankruptcies throughout the United States.

Although I remain perplexed as to why these changes were made in they way that there were, and wonder how they really help anyone, we at the Lakeshore Bankruptcy Center will be prepared to use the new forms in order to help people who need to seek bankruptcy relief.

Forms are really only the means to get relief. We needed to understand how to complete the old forms. We need to understand how to complete these new forms in the way that is required for our clients to get proper relief. The new forms, in my view, are not any more understandable than the old ones. Sure, there are more questions presented in the new forms where the old forms had more “lists”. But I always believed that, if someone simply reads the forms carefully, they could understand them and see what information needed to be provided in them.

Understanding the legal effect of statements made in these forms is another matter. Whether someone uses the old or new forms, they still need to get decent advice about their legal options and the results of legal choices. For instance, if you answer a question about transfers made prior to a bankruptcy, that does not mean that you know the legal result of starting a bankruptcy after such transfer. The forms also do not even start the process of reviewing the documents which will be important in a bankruptcy proceeding. This is a crucial part of preparing for a bankruptcy proceeding. First, document production is going to be required by a trustee in order to succeed in the case. Second, bad documents often lead to bad results, for the person filing the bankruptcy and for people they know and with whom they have had financial dealings.

What this means is that bankruptcy is not a simple process. The use of forms might give a false impression that it is. You need an experienced attorney to review your situation, see what looks best for you and then prepare to get you through the bankruptcy system so that you understand what is happening to you and so that you do not make costly mistakes. At Lakeshore Bankruptcy Center, we make it our high priority to do this for you. It is all we do – bankruptcy law. So, when big changes happen in bankruptcy practice, like new forms, we are ready and able to work for you and get you the relief that you need.

Call us for a first conference at no charge. We are here for you.  616.396.2124

 

Posted November 6, 2015

The FAQs below provide general information regarding bankruptcy questions and are not intended to provide you with specific legal advice. Your situation is unique and should be reviewed with an attorney. We at Lakeshore Bankruptcy Center can meet with you for no charge in an initial conference and provide you with legal advice and recommendations for your specific situation.

Do you qualify for bankruptcy?

Under present law, there are no specific “qualifications” for bankruptcy, like minimum debt. Some bankruptcies are limited to certain types of debtors or in the amount of debt you can have.

There are some things that can keep you from getting a discharge of debt in a bankruptcy or which might cause your case to be dismissed. For instance, if you received a previous bankruptcy discharge you may be within a moratorium to get another discharge in another bankruptcy. Also, you must comply with the various requirements of the bankruptcy system to get your discharge.

In chapter 7, if your budget shows that you can pay a significant amount to creditors over time, your bankruptcy could be dismissed by the court. This is shown through the “means test” and the budget part of the Schedules. In such cases, we consider whether chapter 13 would assist you in your financial situation.

We at Lakeshore Bankruptcy Center review these issues fully prior to starting a bankruptcy for a client. Most clients can file a bankruptcy and get a discharge. The question then becomes, whether you should consider or file a bankruptcy.

Should you consider bankruptcy?

If you are often unable to pay your bills, using credit cards to pay other credit cards, are behind on your car or home loan, getting constant calls from creditors, you should probably consult an experienced bankruptcy attorney. There are many reasons which could cause someone to consider bankruptcy. It is not advisable to wait until a repossession, notice of foreclosure, service of a lawsuit complaint or other official legal action against you, although we could still help you, even if that had happened. The longer you wait if you are really in trouble, the harder it will be to help you and the more expensive your case could be.

Making the decision to file should be done after careful consideration with an attorney who knows your full financial situation. Many believe that filing bankruptcy should be a last alternative.

We at Lakeshore Bankruptcy Center have a system to learn about your situation. We can sit down with you and provide effective advice about all of your alternatives, so that you can make a good decision.

What are the benefits of bankruptcy?

Bankruptcy does many things, but most importantly, it frees you from debt. That is what is known as your discharge. Some debt is not discharged by bankruptcy. Also, you still need to work with secured creditors to keep items that are pledged as collateral.

Bankruptcy immediately stops most creditor action against you. That is the automatic stay. There are exceptions to this such as criminal prosecutions and certain actions related to support obligations.

Bankruptcy can also help you handle arrearages on your home payments and rearrange your financial situation to better suit your needs and income.

We at the Lakeshore Bankruptcy Center can tell exactly how bankruptcy could help you in a free initial consultation.

How will bankruptcy damage your credit or hurt you?

Bankruptcy will be on your credit record for 10 years from the date you start the bankruptcy. For some creditors, this could disqualify you for future credit. This depends upon the creditor and its lending policies.

Also, getting a bankruptcy discharge will limit your future ability to get another bankruptcy discharge for a period of time. (How long depends upon the kind of bankruptcy.)

Bankruptcy could result in the loss of your property. This is where exemptions are important. Bankruptcy could cause lawsuits to undo transfers which you make prior to or after you start your proceeding. This is called “avoidance” and it can cause great disruption for you and those who received the items transferred.

That is why it is important to see a qualified attorney who takes the time to understand your situation prior to filing bankruptcy.

Our goal at the Lakeshore Bankruptcy Center is to spot potential sticky issues before we file. This allows us to explore legal solutions to these problems. Because Marcia R. Meoli is a bankruptcy trustee, she can usually spot these issues so that there are no surprises.

 

Posted October 18, 2015

On October 15, 2015, the West Coast Chamber of Commerce was kind enough to drop by for a ribbon-cutting event, celebrating our new office at 1180 Ottawa Beach Road.  Great friends and family joined others at the event.   We want everyone to know that we can help people with financial problems review their alternatives, including whether bankruptcy would help them.  Check out our brochure which explains our process.  Brochure for Holland MI bankruptcy attorney .

Ribbon cutting photo

Thanks to the Chamber for your support!

Posted August 27, 2015.

The FAQs below provide general information regarding common bankruptcy questions and are not intended to provide you with specific legal advice. Your situation is unique and should be reviewed with an attorney. We can meet with you for no charge in an initial conference and provide you with legal advice and recommendations for your specific situation.

What is a Chapter 7 Bankruptcy?

Chapter 7 Bankruptcy is for people with limited income and who are unable to make payments to their creditors. Most debts are discharged in a Chapter 7 bankruptcy and the entire process takes about 4-6 months.

What is a Chapter 13 Bankruptcy?

Chapter 13 Bankruptcy is meant for people who have the ability to make payments to their creditors pursuant to a payment plan that the court approves. Debtors pay what they can afford for 3 to 5 years, interest stops on unsecured debts like credit cards, and substantial debt remaining is discharged. Payments are made to the Chapter 13 Trustee.

What debts can be discharged in a Chapter 7 Bankruptcy

Credit card debt, medical bills, personal loans, and many other unsecured debts are discharged in a Chapter 7 bankruptcy. This means that you won’t ever have to pay on the debt again. Review with us to determine which of your debts will be dischargeable.

What debts can’t be discharged?

Child support, spousal support, student loans, some tax liabilities, and certain criminal fines and restitution are typically not dischargeable in bankruptcy. We can review your specific situation regarding these matters.

What happens with my mortgage and car loan if I file bankruptcy?

In Chapter 7, if you are or can get current on your car loan or mortgage payments, you could reaffirm that debt and keep the property. You may also decide to surrender the property and your mortgage and car loan debt will be discharged. In chapter 13, you may be able to save a home or car even if you are behind on the payments. We can review this with you to see if that is feasible.

Will I lose my property?

The Bankruptcy Code provides “exemptions” for interests in real estate and personal property. Property that is “exempt” can be kept by debtors and will be protected from liquidation. Our clients often are able to keep all of their property and get their fresh start.

Do I need an attorney to file a bankruptcy?

Filing a bankruptcy involves a mountain of paperwork and the Bankruptcy Code is complex. Individuals who attempt to file without an attorney can put themselves at risk of having their case dismissed, losing property that could have been protected, or other bad consequences. You should always seek the help of a qualified bankruptcy attorney and we would glad to help you.

Contact us today for your free, no-obligation consultation.  616.396.2124

______________

Marcia R. Meoli left her previous law firm effective June 1, 2015. She started her own office, Marcia R. Meoli, PLLC and will also operate under the name of Lakeshore Bankruptcy Center. She is located at 1180 Ottawa Beach Road, Suite A, Holland, MI 49424.

You may reach her at 616.396.2124 .

Marcia will continue to practice bankruptcy law, representing individuals and businesses in bankruptcy proceedings. She will also continue on the panel of chapter 7 trustees in the Western District of Michigan, holding meetings of creditors in Grand Rapids, Michigan.