Cambridge Analytica files for bankruptcy

U.K based Cambridge Analytica, the company that was caught up in the data harvesting scandal with Facebook has filed for bankruptcy in a New York Court. The move comes on the heels of them announcing the winding down of their operations in the UK.

The company listed $1-$10 million in liabilities in its filing. In their Chapter 7 filing they will be liquidating their U.S. affiliates such as SCL Elections Ltd., and SCL USA Inc. and SCL Social Ltd. The bankruptcy petition was signed by board members Jennifer and Rebekah Mercer, daughters of New York hedge fund manager Robert Mercer whose family backed Donald Trump for President.

The company, which did work for Trump’s campaign claims they lost almost all their business after their Facebook data mining shenanigans were revealed. The case could shed light on Analytica’s financial and other relationships in the US. In the UK such proceedings are less transparent.

Among the creditors the company cited were Google, Facebook and Target. They didn’t detail what those liabilities are. Other creditors listed in the filing were other data analysis companies such as Datawatch Systems based in Maryland, which has building access technology to control and Doximity Inc., a social network for healthcare professionals.

Read More

Court decision awards debtor $125,000

Once you file a Bankruptcy Petition, the law protects you from continued creditor harassment. AFederal Court awarded a debtor $63,000 in compensatory damages and $63,000 in punitive damages when a debt collector continued to harass a debtor after he filed Chapter 7 bankruptcy. This case, In Re Burch v. Bank of America decided on July 27, 2011 affirmed earlier court cases. But, this case awarded punitive damages in addition to compensatory damages.

The Bankruptcy code, Section 362 provides that the filing of a bankruptcy prevents the continuation of any act to collect or recover a claim against a debtor that arose prior to the filing.

To collect money damages against a creditor or debt collector, the party must prove the following

  1. The bankruptcy petition was filed
  2. Debtors are individuals under the automatic stay provision
  3. Creditors received notice of the petition
  4. Creditor’s actions were in willful violation of the stay
  5. The debtor suffered damages

For a creditor’s act to be willful, under section 362 (k), the creditor need not act with specific intent, but must only commit an intentional act with knowledge of the automatic stay. Listing the creditor in the bankruptcy petition satisfies this provision. In this case the creditor continued to harass the debtor after repeatedly receiving notice of the bankruptcy.

If you or anyone you know is a victim of continued harassment after filing a Bankruptcy Petition, you have a right to sue for money damages. The rewards are significant. It is time to turn the table and fight back against heartless harassing creditors. Your fresh start after bankruptcy could be a prosperous one.

You can read the relevant decision here Clay Daniel Burch, Plaintiff, v. Bank of America, N.A., Defendant. 

 

Read More

Raise in Filing Fees for Chapter 7, Chapter 13 Bankruptcy

As if times are not tough enough for bankrupt debtors, The US Bankruptcy Court just announced a cross the board increase in filing fees, effective December 1, 2016.

The latest, revised rates for filing a Chapter 7 Bankruptcy are $335.

Similarly, the filing rates for Chapter 9 and a Chapter 11 Bankruptcy also increased to $1,717 each.

For Chapter 13, the filing rate is now $310.

For details of all other rates relating to bankruptcy filings, please visit the following website:

http://www.nysb.uscourts.gov/filing-fees

 

For more information email me at j.weinstein@jlwlawoffices.com or call me at 212-693-3737 for Free Consultation

Read More

Wildcard Exemption – Chapter 7 Bankruptcy

Benefits of the Wildcard Exemption in Chapter 7 Bankruptcy

You do not have to be flat broke to file Chapter 7 Bankruptcy. In fact, today you can retain more of your assets when filing Chapter 7, by electing to take advantage of the Federal “Wildcard” exemptions when you file New York Chapter 7 bankruptcy. Until recently, the Federal Exemptions were not available to New York residents.

Under New York Law, an individual filing Chapter 7 can only retain up to $5,000 of personal property, which includes only $2,500 in cash and securities. Any additional assets must be turned over to the Trustee, for distribution to creditors.

Now, a New Yorker can choose either the New York Exemptions or the Federal Exemptions when filing their Chapter 7 Petition. New York has a higher Homestead exemption, which is now $150,000 for a home owner.

But, if you do not own real estate, you should opt for the Federal Exemptions.

Under the Federal rules, you can apply up to 50% of the federal homestead exemption, which is $21,625 plus an additional $1,150 to shelter cash from your creditors. You cannot mix and match, you have to go with either New York or the Federal Rules. But, for many debtors, the Federal Rules provide more flexibility and may help one qualify for Chapter 7 bankruptcy.

Be sure to check out the full list of Exemptions before you file Chapter 7.

For more information email me at j.weinstein@jlwlawoffices.com or call me at 212-693-3737 for Free Consultation

Read More

Bankruptcy Update

NY State Doubles Homestead Exemption

Filing a Chapter 7 Bankruptcy in New York has just gotten easier for hundreds of thousands of homeowners in New York. In December 2010, the state increased the homestead exemption from $50,000 to as much as $150,000, per individual, $300,000 per married couple in some New York jurisdictions.

This means that if an individual owns a home or apartment – and the home is his primary residence – he can file Chapter 7 bankruptcy, and he can shelter up to $150,000 ($300,000 for a couple) in homestead equity from creditors. The New York legislature is finally catching up with inflation, although still far behind many other states.

New York has long been deemed a “creditor-bias” state because the exemptions are among the lowest in the Country. Whereas, other states, like Florida in particular is a debtor-friendly state. Florida has an unlimited homestead exemption. A Floridian filing a Chapter 7 bankruptcy may be able to discharge all his unsecured debt, and creditors cannot touch his home, even if it is worth millions of dollars.

In addition the increase in homestead exemption, other increases include raising the vehicle exemption from $2,500 to $4,000.

Thus, contrary to popular belief, you don’t have to be totally broke to file Chapter 7 bankruptcy. You are legally able to claim certain “exemptions”, which allow the debtor, to shelter certain assets from your creditors. The most favorable clause allows a debtor to keep 100% of all retirement accounts, 401K, IRA’s , etc.

Let me illustrate how the NY homestead exemption works. Say you live in New York City, you have a Condo with a FMV (Fair Market Value) of $900,000. You currently have an outstanding principle balance of $600,000 on your mortgage. Together you and your spouse have a combined $300,000 homestead exemption. The exemption covers 100% of your equity in the condo.

Thus, if you file a joint Chapter 7, your Condo is 100% protected from your creditors.

Under the old law, only $100,000 of your equity was protected and $200,000 would be vulnerable if you filed a Chapter 7 Bankruptcy, your creditors could force the sale of your condo to collect up to $200,000 of debts.

For more information on New York exemption or on filing Chapter 7 or 13 Bankruptcy, email your questions at j.weinstein@jlwlawoffices.com or call me at 212-693-3737 for free consultation.

Read More