Pop quiz:  what do payday lenders have in common with on-line gun shops, escort services, pornography websites, on-line gambling and the purveyors of drug paraphrenalia or racist materials?  
You can read my testimony for this Thursday's House Judiciary Committee, Subcommittee on Regulatory Reform, Commercial, and Antitrust Law's hearing on Operation Choke Pointo find out. Or you can just keep reading here.  

What all of these businesses have in common is that they are considered high-risk customers by banks. What makes these industries high-risk for banks? Many of their payments are disputed. Sometimes the issue is consumer fraud, sometimes merchant fraud:  happily married men vehemently deny subscribing to porn sites or having paid for an escort service. Or a payday lenders might demand an ACH payment without authorization.  All of this matters to banks because banks make various warranties when they transmit or demand payments within the payment system. If a payment isn't authorized, the bank can be stuck with the loss. 

Credit Slips
(posted 1 week 14 hours ago)

According to the ISS US preliminary postseason update, the win rate for dissidents, measured by whether they won at least one board seat through negotiations or a vote, was 59% at 22 contested elections in the first half of 2014, compared to 24 contests with a 68% success rate by June 2013.  The size of the target continues to increase, as seven of the companies had market capitalizations greater than $1 billion.  Notable for 2014 were what ISS dubbed “hydra-headed activist challenges,” where multiple dissidents targeted the same company but with competing visions, including at Darden and Sotheby's. 

(posted 1 week 15 hours ago)

Breaking News This Morning ... Earnings: JPMorgan Chase, Comerica, Commerce Bancshares Receiving Wide Coverage ... Citigroup Settlement, Day 2: Citigroup has agreed to pay $7 billion to settle Justice Department charges it sold mortgage-backed securities stuffed with subprime mortgages to unsuspecting investors in the years leading up to the 2008 financial crisis. About $4 billion of the penalty will go into the U.S. Treasury's general fund. The rest will be divided among other federal agencies, with about $2.5Â...

(posted 1 week 15 hours ago)

Philip Falcone‘s LightSquared has reached a deal on a restructuring plan that has the support of Dish Network Corp. Chairman Charlie Ergen, its top secured lender. The Wall Street Journal has the Daily Bankruptcy Review article here.
The financing company behind four large crude oil carriers filed for Chapter 11 bankruptcy protection Monday to restructure its balance sheet following the loss of contracts to carry product for BP PLC’s maritime unit. Read the DBR article here.
(Daily Bankruptcy Review is a daily newsletter with comprehensive coverage and analysis of emerging and in-progress insolvencies and turnarounds. For a two-week trial, visit our homepage, scroll to the bottom and click “try for free.”)
The Houston Rockets and the Houston Astros need a new owner for the struggling television channel that broadcasts their games, and they want to keep the names of potential purchasers a secret for now. Read the DBR article via WSJ.

WSJ.com: Bankruptcy Beat
(posted 1 week 15 hours ago)

  Springtime is supposed to be a joyful time for those who have graduated from college. However, for many members of the class of 2014, graduation means that they have left their student lifestyle behind, and they are about to meet their student debt obligations head-on. Typically, this reality is felt the most six months... Read more »
The post Obama Introduces The New Pay As You Earn Plan Capping Student Loan Payments appeared first on AllmandLaw.

(posted 1 week 16 hours ago)

In re Joan Fabrics Corp., 508 B.R. 881 (Bankr. D. Del. 2014) – The buyer of assets in a bankruptcy sale sought to enforce its asset purchase agreement against a county that was seeking to collect personal property taxes arising … Continue reading →

(posted 1 week 18 hours ago)

A quick note on a couple of events today that might be of interest to Slips readers:
First, I'm participating in an ABI webinar about "chapter 14" and related topics.
Second, I'll be testifying in front of the House Judiciary Committee on proposed legislation to add a subchapter V to chapter 11, for financial institutions.
Otherwise, resume your summer and I'll bother you no more.

Credit Slips
(posted 1 week 20 hours ago)

This is a very important question if you have Student Loans that you still owe.  It may have been a long time since you took out the Student Loans or the name of the company to whom you are writing the check may have changed.
But, this is a very important question to ask.  The reason why this is so crucial is that there are certain flexibilities and programs to alter the terms of your payments that are only available on Federal Loans.  If you have a Private Student Loan, you will not be eligible for these reductions in payments.
So, how do you know if the loan giving you so much trouble is a Federal Loan or a Private Loan?
Simply go to this website-  WWW.NSLDS.ED.GOV and put in the information requested when requested at the followinga page, including your PIN-  https://www.nslds.ed.gov/nslds_SA/SaFinLoginPage.do
(If you cannot remember your PIN, go this webpage to retrieve or change it-  https://pin.ed.gov/PINWebApp/pinindex.jsp  )
Once you have entered the information on the NSLDS page, including your PIN, you will receive a list of all of your Federal Student Loans.  If the loan giving you the difficulty is not on that list, it is a Private Student Loan.  How to resolve your dilemma or default will be greatly different depending on whether you are dealing with a Federal Loan or a Private Student Loan.

Scholnick Law
(posted 1 week 1 day ago)

Sherman passed in late March, 2014 in Leawood, Kansas.
He attended Case Western Reserve University in Cleveland where he obtained his BA in Journalism and History and his LLB and JD Law degrees. After graduation he worked at the Department of Labor in Washington, DC and then formed his own law firm in Cleveland, OH. He later pursued business management and consulting in the Kansas City area. He also taught graduate level classes in marketing and business management at Webster University and authored several articles and business publications focused on family-owned business.
Sherman was a long-standing member of The Temple, Congregation B’nai Jehudah and Leo Baeck Temple, Los Angeles, CA. He served for many years on B’nai Jehudah’s Board of Trustees and also served on several other community Boards.
He was preceded in death by his parents and a daughter, Stacey Titens Wizig, in 2010.
Sherman is survived by his wife of 55 years, Peggy Titens, of the home; son and daughter-in-law: Michael and Stacey Titens, Dallas, TX; daughter: Joan Titens, New York City, NY; son-in-law: Howard Wizig, Leawood, KS and three grandchildren: Marissa Wizig, Hayley Wizig and Josh Titens.

(posted 1 week 1 day ago)

Valuation Fights in Bankruptcy Webinar is now available on demand.
The key battles in Chapter 11 often revolve around valuation disputes.  Valuation comes up early in a case, in the context of lift stay and financing motions.  It typically comes up again near the end in the context of confirmation battles.  And, valuation plays an important role in between.  This webinar will provide an overview of the varying contexts where valuation is a key driver and will discuss how courts arrive at decisions regarding value in various circumstances.
This webinar is produced in conjunction with The Commercial Law League of America and offers CLE credit for attending.
Click here to register for this webinar. Cost for this one-hour webinar is $100.

(posted 1 week 1 day ago)