financialWhen individuals are talking to their financial adviser about their future and their hope to retire, the financial adviser should have at least a basic understanding of the bankruptcy process.  While Bankruptcy is an extreme measure that should not be taken lightly, it is also a powerful tool for those in debt to free themselves of their past mistakes and get on track for a bright future.
Often times I see individuals who have been seeing a financial adviser for years.  He has advised them how much money they need to save for retirement.  He has advised them when they should start saving and how much they should be putting away each month.  He may even have helped them develop a plan to pay off their credit card debts over the course of the next decade.  What I rarely see is a financial adviser who has taken the time to review the individuals case with a qualified bankruptcy attorney.

(posted 1 week 3 days ago)

Houlihan Lokey is firing up PowerPoint and striking a strategic partnership with a consulting firm.
The boutique investment bank has taken a stake in Chicago-based management and strategy consulting outfit Bridge Strategy Group, it announced today.
It’s the latest move  within the clique of ambitious boutique investment banks who have been on an expansion kick of late.
But it’s of a slightly different flavor than what we’ve seen in the past.
Earlier this month Evercore Partners Inc. announced it was buying research boutique International Strategy & Investment Group LLC as a way to expand its equities business and work on more capital markets deals. Moelis & Co. recently poached a group of bankers who raise funds for private equity firms. And Houlihan itself has previously acquired specialist M&A advisory firms, in tech and financial services.

WSJ.com: Bankruptcy Beat
(posted 1 week 3 days ago)

Banks, insurance brokers, and other agents can breathe a sigh of relief as the Fourth Circuit enabled the “mere conduit” defense to survive another day. The Fourth Circuit has long recognized the proposition that an avoidable transfer cannot be recovered, pursuant to section 550(a)(1) of the Bankruptcy Code, from a transferee who acted as a “mere conduit” for another party having the direct business relationship with the debtor. In Guttman v. Construction Program Group (In re Railworks Corporation), this recovery defense was put to the test.
The Alleged Preferential Transfers
Railworks Corporation, a national provider of rail systems services, filed a voluntary chapter 11 petition in 2001. Prepetition, Railworks maintained insurance coverage through TIG Insurance Company. Rather than paying premiums to TIG directly, Railworks paid Construction Program Group — the managing general underwriter for TIG — which then forwarded the payments, less commissions, to TIG.

(posted 1 week 3 days ago)

Higher capital requirements, sluggish GDP growth and antiquated cost structures are stymying banksÂ' efforts to boost returns to investors. This will likely lead to a boom in mergers and acquisitions over the next decade, writes Richard J. Parsons.

BankThink
(posted 1 week 3 days ago)

Authored by Scott St. Amandand J. Ellsworth Summers, Jr. of Rogers TowersTwenty-seven years ago the Second Circuit was faced with a debtor who proposed to use the Bankruptcy Code to avoid her student loan debt – only five months after graduation.  The Second Circuit came down harshly on Ms. Brunner and established an “undue hardship” test, which few debtors have passed since the decision in the Brunner case.  Eleven of the federal circuit courts, including the Eleventh Circuit, have adopted the Brunner “undue hardship” test, and there have been few significant challenges to the standard over the nearly three decades of its existence.
Since Brunner was decided, however, the Bankruptcy Code has changed significantly and the nation’s student loan debt has risen at an astonishing rate.  In 1987, educational debt was approximately $42 billion.  Fast forward twenty-seven years later, and there is nearly $1 trillion in outstanding educational debt – an increase of 2281%.  This dramatic increase has led some commentators to argue that Brunner is outdated, and changes need to be made to bankruptcy courts’ approach to student loan forgiveness.

Florida Banking Law Blog
(posted 1 week 3 days ago)

In re NE Opco, Inc., No. 13-11483 (CSS), 2014 WL 3884217 (Bankr. D. Del. Aug. 8, 2014)
In the chapter 11 proceedings of NE Opco, Inc. and its affiliated debtors (the “Debtors”), the Honorable Christopher J. Sontchi was presented with a unique set of circumstances leading to the following question—whether pre-closing claims against a purchaser, related to the sale and arising from conduct occurring after the entry of a sale order, should be barred and enjoined by the section 363(f) finding in the sale order.  The Court held that they should.
  Read More ›
Tags: Section 363(f), Successor Liability

Delaware Bankruptcy Insider
(posted 1 week 3 days ago)

The latest SEC award to a whistleblower was notable for having been initially denied because the SEC decided that the information was not “voluntarily” provided. Under the SEC rules, a submission is not being made voluntarily if a request, inquiry or demand related to the subject matter is directed to the whistleblower by the SEC, PCAOB or any self-regulatory organization (SRO) or in connection with an investigation by federal or state authorities.

(posted 1 week 3 days ago)

Expanded reporting requirements under the Home Mortgage Disclosure Act will give regulators access to a panoply of sensitive data. Banks should take steps to address any fair lending issues before the new rules take effect, according to Warren W. Traiger.

BankThink
(posted 1 week 4 days ago)

My Consumer Finance students used to think I was wasting their time by spending a whole class session on usury laws and taking them into the nitty-gritty of their application (or non-application). I think usury is important conceptually (but for the Marquette decision and its fallout, our regulation of consumer credit would likely be very different), has a lot of neat statutory reading twists and turns, and it actually can matter for non-bank lenders.  Among other things I cover is the NY state usury statute, including its criminal provisions. Cyrus Vance's prosecution of payday lenders under the usury statute would seem to vindicate my choice of class materials. 

Credit Slips
(posted 1 week 4 days ago)