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Frederick J. Hanna & Associates Accused of Wrongfully Charging Debtors for Court Error

Another rip-off alert involving collection attorney, Frederick J. Hanna & Associates. I’ve written about this collection firm before, warning my clients and cosumers about the aggressive collection tactics of this collection firm: https://northgabankruptcy.wordpress.com/2011/10/17/are-you-defending-a-lawsuit-or-garnishment-served-by-frederick-j-hanna-associates-things-you-should-know/

Yet again, Channel 46 CBS Atlanta News reports that Frederick J. Hanna & Associates faces new accusations of ripping-off debtors.  According to the report, a class action lawsuit was filed accusing the law firm of garnishing paychecks of debtors for late charges or interest they didn’t legally incur or owe.  Check out the article, and watch Fred Hanna squirm when approached by the investigative reporter, at this link:

http://www.cbsatlanta.com/story/24832869/cobb-law-firm-accused-of-charging-former-debtors-for-court-error

If you feel like Fred Hanna is ripping you off or taking advantage of you, please give me the opportunity to help level the legal playing field. I take-on Fred Hanna every single week. Check out the client testimonial page of my website for a sample of the results: http://www.northgabankruptcy.com/testimonials/

The consultation is always free, confidential, and courteous.

Brian R. Cahn
brc@perrottalaw.com
Cartersville – Dallas – Calhoun – Dalton

(770) 382-8900

Debt Settlement vs. Bankruptcy – Which Option is Better?

Nobody wants to file for bankruptcy, but when creditors become aggressive, all options must be considered. Every situation is different, but here are some things to consider:

Advantages of Debt Settlement:

Settlement of debts has the advantage of avoiding the stigma of bankruptcy. Furthermore, a properly-structured settlement can mitigate the damage to your credit, while substantially lowering the balance.

Many debts can be settled for pennies on the dollar. According to the “Collections and Credit Risk Newsletter”: One of the largest collectors, Midland Funding, has paid more than $2.1 billion to purchase about 40 million accounts with a face value of about $66.4 billion, or about three cents on the dollar, mostly from banks, credit card companies and cellphone companies that had written off the bad debts, the attorney general’s office said.

So, if collection agencies are acquiring the debt from the origianl creditor for as little as 3 cents on the dollar, you can certainly settle the debt at a substantial discount. One debt settlement company advertises an average settlement amount of only 19% of the original debt.

Drawbacks of Debt Settlement:

“Debt Settlement Companies” spend a whole lot of money on TV and radio ads. They also have a long history of problems. See the Federal Trade Commission website for some details –

Although a debt settlement company may be able to settle one or more of your debts, consider the risks associated with these programs before you sign up:
1. These programs often require that you deposit money in a special savings account for 36 months or more before all your debts will be settled. Many people have trouble making these payments long enough to get all (or even some) of their debts settled. They drop out the programs as a result. Before you sign up for a debt settlement program, review your budget carefully to make sure you are financially capable of setting aside the required monthly amounts for the full length of the program.
2. Your creditors have no obligation to agree to negotiate a settlement of the amount you owe. So there is a chance that your debt settlement company will not be able to settle some of your debts — even if you set aside the monthly amounts the program requires. Debt settlement companies also often try to negotiate smaller debts first, leaving interest and fees on large debts to grow.
3. Because debt settlement programs often ask — or encourage — you to stop sending payments directly to your creditors, they may have a negative impact on your credit report and other consequences. For example, your debts may continue to accrue late fees and penalties that can put you further in the hole. You also may get calls from your creditors or debt collectors requesting repayment. You could even be sued for repayment. In some instances, when creditors win a lawsuit, they have the right to garnish your wages or put a lien on your home.Beware of Debt Settlement Scams

Some companies offering debt settlement programs may engage in deception and fail to deliver on the promises they make — for example, promises or “guarantees” to settle all your credit card debts for, say, 30 to 60 percent of the amount you owe. Other companies may try to collect their own fees from you before they have settled any of your debts — a practice prohibited under the FTC’s Telemarketing Sales Rule (TSR) for companies engaged in telemarketing these services. Some fail to explain the risks associated with their programs: for example, that many (or most) consumers drop out without settling their debts, that consumers’ credit reports may suffer, or that debt collectors may continue to call you.Avoid doing business with any company that promises to settle your debt if the company:
•charges any fees before it settles your debts
•touts a “new government program” to bail out personal credit card debt
•guarantees it can make your unsecured debt go away
•tells you to stop communicating with your creditors, but doesn’t explain the serious consequences
•tells you it can stop all debt collection calls and lawsuits
•guarantees that your unsecured debts can be paid off for pennies on the dollar

Researching Debt Settlement Companies
Before you enroll in a debt settlement program, do your homework. You’re making a big decision that involves spending a lot of your money — money that could go toward paying down your debt. Check out the company with your state Attorney General and local consumer protection agency. They can tell you if any consumer complaints are on file about the firm you’re considering doing business with. Ask your state Attorney General if the company is required to be licensed to work in your state and, if so, whether it is.Enter the name of the company name with the word “complaints” into a search engine. Read what others have said about the companies you’re considering, including news about any lawsuits with state or federal regulators for engaging in deceptive or unfair practices.Fees

If you do business with a debt settlement company, you may have to put money in a dedicated bank account, which will be administered by an independent third party. The funds are yours and you are entitled to the interest that accrues. The account administrator may charge you a reasonable fee for account maintenance, and is responsible for transferring funds from your account to pay your creditors and the debt settlement company when settlements occur.A company can charge you only a portion of its full fee for each debt it settles. For example, say you owe money to five creditors. The company successfully negotiates a settlement with one of your creditors. The company can charge you only a portion of its full fee at this time because it still needs to successfully negotiate with four other creditors. Each time the debt settlement company successfully settles a debt with one of your creditors, the company can charge you another portion of its full fee. If the company’s fees are based on a percentage of the amount you save through the settlement, it must tell you both the percentage it charges and the estimated dollar amount it represents. This may be called a “contingency” fee.Disclosure Requirements

Before you sign up for the service, the debt relief company must give you information about the program:
•The price and terms: The company must explain its fees and any conditions on its services.
•Results: The company must tell you how long it will take to get results — how many months or years before it will make an offer to each creditor for a settlement.
•Offers: The company must tell you how much money or the percentage of each outstanding debt you must save before it will make an offer to each creditor on your behalf.
•Non-payment: If the company asks you to stop making payments to your creditors — or if the program relies on you to not make payments — it must tell you about the possible negative consequences of your action, including damage to your credit report and credit score; that your creditors may sue you or continue with the collections process; and that your credit card companies may charge you additional fees and interest, which will increase the amount you owe.

The debt relief company also must tell you that:
•the funds are yours and you are entitled to the interest earned;
•the account administrator is not affiliated with the debt relief provider and doesn’t get referral fees; and
•you may withdraw your money any time without penalty

Tax Consequences
Depending on your financial condition, any savings you get from debt relief services can be considered income and taxable. Credit card companies and others may report settled debt to the IRS, which the IRS considers income, unless you are “insolvent.” Insolvency is when your total debts are more than the fair market value of your total assets. Insolvency can be complex to determine. Talk to a tax professional if are not sure whether you qualify for this exception.

Advantages of Bankruptcy:

Whether filing for Chapter 7 or Chapter 13 bankruptcy, certain advantages exist when compared with debt settlement:

■Filing for bankruptcy may stop debt collection activities such as wage garnishment and repossession of a car
■Filing for bankruptcy does not subject a consumer to a tax on forgiven debts
■Filing for bankruptcy offers a fresh start for those unable to repay their debts

Consumer bankruptcy cases are inexpensive. Chapter 13 cases, for example, are filed for a cost of $351. Chapter 7 cases usually cost between $1,000 and $1,600 – so that cost, compared to the amount of debt being eliminated, is usually minimal.

Bankruptcy can give you a fresh start, debt free. You can use your fresh start as a platform to rebuild your credit. We often see situations where our clients rebuild their credit faster AFTER bankruptcy, than they could have while participating in a drawn-out debt settlement program.

Drawbacks of Bankruptcy:

Bankruptcy isn’t the right fit for every case, and it does impact your credit. Some of our clients have too much income, or too many assets, to qualify for the best types of bankruptcy relief.

Summary:

There’s absolutely no drawback in visiting our law firm for a free case evaluation. We have years of experience, and we can assess your best option with only 1 concern – your best interests. As you can see from our client testimonials, we have represented thousands of satisfied clients. We would be honored to help you accomplish a fresh financial start.

For a free consultation, call Perrotta & Cahn today: (770) 382-8900.

Brian R. Cahn
http://www.NorthGABankruptcy.com
http://www.Perrottalaw.com

North Georgia Bankruptcy Attorney: Tips & Advice if Sued – Successfully Defending a Lawsuit filed by Zwicker & Associates

Over the years, I have successfully  represented hundreds, maybe even  thousands, of clients sued or garnished by the collection firm of Zwicker & Associates.  I’ve managed to help these clients in a variety of ways, whether it’s defending the lawsuit, or erasing the judgment through bankruptcy.

If you’ve been sued by Zwicker & Associates, I can help.   Here’s some practical advice:

1.  KNOW YOUR ENEMY.  Zwicker & Associates is not a creditor.  They’re a debt collector.  Because they’re a debt collector, you are entitled to the protections afforded to you by Fair Debt Collection Practices Act (“FDCPA”).    The FDCPA protects you from unfair and unreasonable collection tactics.  If a representative from Zwicker & Associates has violated any of the FDCPA provisions, we can help you fight back.  We will not hesitate to sue Zwicker & Associates on your behalf, seeking monetary damages for FDCPA violations.  Common FDCPA violations include:

  • Garnishing your wages when not allowed;
  • threatening to charge you with a crime;
  • threatening to take your home, car, or other exempt assets;
  • threatening to call your employer, neighbors, or friends;
  • suing or threatening to sue you on a consumer debt barred by the statute of limitations;
  • telling you they are a law office when they are not, or otherwise misrepresenting their services, or misrepresenting their affiliation with the Court or government;
  • cursing you, or using language intended to unreasonable abuse you;
  • calling you at work when they have been put on notice that you are not allowed to receive personal calls there;
  • calling you at a time or place know to them to be inconvenient to you;
  • misrepresenting the amount owed;
  • misrepresenting your right to dispute an account in collections;
  • misrepresenting the status of the case in a judicial or court proceeding;

Other conduct may also violate collection laws and may be a tort, such as invasion of privacy. I regularly see new collection tactics that simply amaze me in their boldness and disregard for the law.  Zwicker & Associates recently settled a class action lawsuit for FDCPA violations – this settlement was simply a cost of doing business.  There is no evidence whatsoever that FDCPA violations no longer continue.

Collection laws also apply to debt buyers who purchase the account when it is in default, collection agencies, lawyers, and law firms who may call or write to you while attempting to collect a consumer debt.

Whatever the circumstances leading to your present situation, no one deserves to be victimized by overly aggressive debt collectors. These collectors sometimes completely ignore the Fair Debt Collection Practices Act . When they do so, I am prepared to advise you and possibly help you.

Call our office for your free case analysis, and we will tell you if you’ve got a valid claim.

Interestingly, the following excerpt was posted on news website for the California Bar Association:

KENNETH D. ZWICKER 46, of Chatsworth CA, a relative and former associate of Zwicker and Associates was summarily disbarred Aug. 21, 2005, and was ordered to comply with rule 955 of the FDCPA.. Zwicker was also convicted of one count of mail fraud in 2003 and placed on interim suspension in 2004. Because the offense was a felony that involved moral turpitude, he was summarily disbarred.

You should know that Zwicker & Associates or its client has likely purchased your debt from the original creditor or another collector.  When purchasing debt, the buyer does not pay anywhere near 100% of the value of the note.  For example, if you owe $10,000 to the original creditor, it’s likely that Zwicker & Associates or its client purchased the receivable for pennies on the dollar – maybe for as low as 15%, (or $1,500, in our example).  That means that you may be able to settle the matter for pennies on the dollar.  If Zwicker & Associates bought the receivable for $1,500, they may settle for $3,000.  This is a “win-win” settlement.  You’ve just settled your debt for only 30% of your balance, and Zwicker & Associates or its client has doubled their investment.

An ex-employee recently posted the following article about the shady inside operations of Zwicker & Associates:

I worked for Zwicker once upon a time and I can definitely help you!!!

AUTHOR: Denis – E. Hampstead (U.S.A.)

SUBMITTED: Friday, March 27, 2009

POSTED: Friday, March 27, 2009 Hi Kim,

I worked in the collection industry, in the Boston area, for over six years during the late 1980s through the early 1990s. I worked my way up to middle management at three national collection agencies and three collection law firms, Zwicker included.

In 1994, I left the collection industry and joined the lending industry, where I was very happy through the end of 2008. Like thousands of others in the lending industry, I lost my career and my life savings, with the crash of the finance and lending industries. Subsequently, I reluctantly returned to the collection industry and Zwicker & Associates, in an attempt to supplement my income and put food on the table.

In any event, I left after just two short months as I came to realize that Zwicker had not evolved professionally, in any facet of their operation and their collection ethics were worse than I even remembered. to on a professional level and their business ethics or worse than I even remembered.

Zwicker &Associates breaks down into two basic sides of operations, which we will refer to as the front side and the backside.

The front side consists of attorneys, sales and administrative support staff, human resources and technical support. The primary function of the front side is to fabricate and maintain an appearance of integrity, professionalism, ethical standard and employee credibility. Maintaining this type of facade allows them to lure fresh collection placements from credit card companies, bank and retail clients, as well as the occasional debt purchasing company that runs around buying really old accounts, for pennies on the dollar and placing them with companies like Zwicker.

The backside consists of approximately 100 collectors who are all paid a base salary and monthly commissions. The monthly commissions are calculated according to how much money the collector recovers during the course of the calendar month. A recovery goal is established for the collector based on their hourly rate. Once the collector reaches the recovery goal, they are paid a percentage of anything they can collect beyond the goal.

The majority of the collectors at Zwicker, have no educational or professional background and have a marginal understanding of collection laws and practices, at best. They literally live from paycheck to paycheck and many have extremely poor credit. Zwicker has had to settle many lawsuits over the years stemming from complaints filed against them as a result of collection law violations.

Although they represent themselves to be a law firm, which is technically correct, they are nothing more than a collection agency and are regulated as such. I know firsthand that the experienced collectors at Zwicker & Associates have a talent for impersonating a legitimate legal professional for the sole purpose of intimidating, bullying and manipulating money out of people.

Here is the good part: as a resident of Texas, you are guaranteed consumer protection from the Texas Attorney General Office, as well as the Federal Trade Commission’s Fair Debt Collection Practices Act; FDCPA 95-109.

A common practice in the buying and reselling up of old collection accounts, is for collectors to accept settlements, leaving the consumer to believe that the account is paid in full, when in fact, they apply your settlement payment then close the account with a balance and resell it to another purchaser.

When the collector told you that you are subject to the laws of the state of Massachusetts, as opposed to your home state of Texas, he or she was not only wrong, but in direct violation of Texas and Federal law.

You should also know that it is also violation of law for a debt collector to insinuate,threaten legal action.

Let’s recap, shall we?

1) Zwicker is in direct and deliberate violation of Federal and state consumer protection laws for failure to acknowledge your legitimate dispute and furnish documentation of the debt allegedly owed.

2) Zwicker is in direct violation of Federal and state laws for intentionally misrepresenting jurisdiction of collection laws, for the sole purpose of attempting to disarm you of your consumer rights under Texas law.

3) Zwicker is in violation of Federal and state law for threatening legal action and wage garnishment, when they clearly have no intention of taking such action, nor is it legal to do so under Texas law.

Were I in your shoes, I would file a complaint with the Federal trade commission, and the Texas Attorney General Office in writing and enclose any and all supporting documentation.

I would also send Zwicker a certified letter, instructing them to cease any and all communications immediately.

You never mentioned whether or not they reported this account to your credit report. If that is the case, then Zwicker is also in violation of the fair credit reporting act as well.

It is extremely important that you understand that you were speaking to a collector that could have cared less whether you all the money or not. His one main concern was to tell you what ever it took to get you to pay the money in order to force himself closer to commission.

GOOD LUCK!!!

2.  BEWARE OF SETTLEMENT WITHOUT AN ATTORNEY REPRESENTING YOU.  The golden rule with regard to debt settlements is “get it in writing!”   You should always have your own attorney review any proposed consent judgment or settlement agreement.   Mr. Zwicker’s office doesn’t represent you, so you should be skeptical about any proposed settlement offers.  The settlement should state that your credit will reflect that the account is settled and paid in full when the settlement amount is paid.

3.  KNOW YOUR OPTIONS.  When you’re sued, you have a number of options.

First of all, explore any possible defenses to the lawsuit.  For example, it’s possible that the lawsuit was filed after expiration of the applicable statute of limitations.  If so, an Answer can be filed raising the defense, and the case can be thrown-out by virtue of a Motion to Dismiss or a Motion for Summary Judgment

If the lawsuit was filed to recover a post-repossession deficiency on a repossessed vehicle, you may have several technical defenses based upon Georgia’s adaptation of the Uniform Commercial Code.  Did you receive a certified letter notifying you of your 10-day right of redemption?  Does the size of the deficiency imply that the vehicle wasn’t sold in a commercially reasonable manner?  These are defenses that we can explore.

4.  BANKRUPTCY AUTOMATICALLY STOPS LAWSUITS AND GARNISHMENTS.  Anoter option is a chapter 7 or chapter 13 bankruptcy.  Our office can file a bankruptcy for as little as $344 down.  The mere filing of the bankruptcy will stop all collection activity, including the lawsuit or garnishment.   We do all the work.  Typically, you keep your assets, and you pay absolutely nothing to Mr. Zwicker and his Associates.  A chapter 7 or chapter 13 bankruptcy is designed to give you a fresh financial start.

The worst thing you can do is “nothing.”  That’s what Zwicker is hoping will happen – if you do nothing, they’ll get a default judgment and garnish your paycheck and put a lien on your property.  Fight back.   If you’re looking for an aggressive advocate with experience; an attorney who enjoys fighting  Zwicker & Associates, give me a call, or send me an e-mail.

Brian R. Cahn | brc@perrottalaw.com | 770-382-8900

Perrotta, Cahn & Prieto, P.C. | www.northgabankruptcy.com

Atlanta | Dallas | Cartersville | Calhoun | Cartersville

Defenses to Preference Lawsuits, Complaints for Preferential Transfers

Assume the following:  You have an ongoing business relationship with a client or customer.   That customer filed bankruptcy.  YOU GET SUED by the client or its bankruptcy trustee because you were paid within 90-days of the bankruptcy filing.  Your first impression is that the lawsuit is frivolous – they owed you the money!   Why did this happen?

The Bankruptcy Code contemplates a fair distribution of the debtor’s assets to all creditors.  In that regard, the “preference” law was included in the Code to prevent the debtor from re-paying certain favored creditors over other creditors, right before filing the bankruptcy.

Trustees involved in bankruptcies take a shotgun approach and ask for all money and assets to be “paid back” to the bankruptcy court if received within ninety days prior to the date of the bankruptcy filing.  Trustees earn a percentage of all monies and assets that flow through Bankruptcy Court proceedings; consequently, their demands are all inclusive without any consideration to those circumstances where the creditor is allowed to retain assets and payments.  A debtor is deemed insolvent ninety days prior to the filing of any bankruptcy. This is the premise for the Trustees’ demand that preferential payments be paid back to the Bankruptcy Court for re-distribution. Although somewhat unusual but not uncommon, the bankruptcy trustee in a Chapter 11 and especially a Chapter 7 treats all payments and transfer of assets during the last ninety days leading up to the bankruptcy filing as preferential.  There are defenses to these bankruptcy preference claims, which are also known as avoidable preferences.  Avoidable preferences mean that exceptions are allowed and in those situations a creditor can avoid the “pay back” preference.  The most common defenses of bankruptcy preference claims are as follows:

 1.       Payments made by a debtor in the “debtor’s ordinary course of business.”

2.       New value considerations including COD transactions, Special Orders and Lien Rights.

3.       Two-year statute of limitations.

4.       Application of the “Necessity Doctrine.”

 A creditor who receives a Trustee’s demand to return a preferential payment has a number of alternatives, which range from disregarding the demand to acquiescing and returning all of the money.  It is our recommendation that in every instance arguments be advanced to the Trustee that payments made to your company are not considered preferential. Based on one or more defenses, you will have to provide the specific particulars and tie them into your defense.  In every situation where we have passed along information to assist a client in defeating a preferential claim, there has never been an instance where a Williams & Williams client has paid 100% of what was being demanded by the bankruptcy Trustee. 

 A creditor can use the defense that the payment occurred in the debtor’s ordinary course of business, if it can be shown through payment history that previous payments were consistently late and outside terms. This pattern of lateness was the debtor’s established normal course of business.  If there is no prior evidence of deviation from invoice terms, then the courts will find that the payment is a preference.

 Special orders are considered due and payable when raw materials are secured.  If it can be shown that end user consumers took deposits, then such transactions would be considered not only as ongoing new consideration but also application of the “Necessity Doctrine.”

 The Necessity Doctrine is payment favoritism shown by a debtor because the creditor’s merchandise is considered indispensable and crucial to the debtor’s business.  Accordingly, the Necessity Doctrine could be applied to a featured name brand supplier or a seller providing “gallery” inventory and merchandise to a “gallery” retailer. 

 New value consideration can be in the form of additional merchandise being shipped within the 90-day preference period.  This amounts to new and additional consideration tendered to the debtor within the 90-day period and thus any payments made would be avoidable, as the Bankruptcy doctrine does not discourage new value consideration to a financially struggling company.

In addition, several other defenses exist.

Because each preference case is fact-specific, you must meet with an attorney IMMEDIATELY upon receipt of a preference complaint.  Make sure to choose an attorney that is well-versed not only in bankruptcy law, but in preference defenses.

We have successfully defended clients in dozens of Georgia bankruptcy preference cases.   For more information, contact us for a consultation.

Brian R. Cahn – Perrotta, Cahn & Prieto, P.C.

(770) 382-8900

Cartersville | Dallas | Calhoun | Dalton | Atlanta

FIGHT BACK against SHERWIN P. ROBIN – Cavalry Portfolio Services, LLC or Calvary Investments, LLC: Lawsuit and Garnishment Mill

Over the years, I have successfully  represented hundreds of clients sued or garnished by the Savannah, GA collection firm owned by attorney Sherwin P. Robin.  I’ve managed to help these clients in a variety of ways, whether it’s defending the lawsuit, exploring FDCPA violations, or erasing a judgment through bankruptcy.

If you’ve been sued by Sherwin P. Robin, I can help.   Here’s some practical advice:

1.  KNOW YOUR ENEMY.  Sherwin P. Robin is not a creditor.  He’s a debt collector.  Because he’s a debt collector, you are entitled to the protections afforded to you by Fair Debt Collection Practices Act (“FDCPA”).    The FDCPA protects you from unfair and unreasonable collection tactics.  A simple Google search shows that Sherwin P. Robin has been sued before – the lawsuit alleged that Mr. Robin violated the FDCPA’s consumer protection laws.  If you feel that Mr. Robin’s collection tactics violated your FDCPA rights, make an appointment with me for your free case analysis, and I will tell you if you’ve got a valid claim against Mr. Robin.

It’s unclear as to whether Cavalry Portfolio is an actual “client” of Mr. Robin’s, or whether it’s an entity owned by Mr. Robin.

You should know that Sherwin P. Robin, and/or his “client,” Cavalry Portfolio, has likely purchased your debt from the original creditor or another collector.  When a collector, like Cavalry Portfolio purchases a debt, the debt is “assigned” by the old creditor to Cavalry.

When you are sued by an unfamiliar entity (like Cavalry Portfolio), you are entitled to demand PROOF of a valid assignment.  I’ve seen many cases dismissed because the Plaintiff can’t provide proof of a valid assignment; i.e., it can’t prove that it owns the debt it’s collecting.

When purchasing debt, the buyer does not pay anywhere near 100% of the value of the note.  For example, if you owe $10,000 to the original creditor, it’s likely that Sherwin P. Robin or his client purchased the receivable for pennies on the dollar – maybe for as low as 15%, (or $1,500, in our example).  That means that you may be able to settle the matter for pennies on the dollar.  If Cavalry Portfilio Services, LLC, bought the receivable for $1,500, they may settle for for any amount in excess of their cost.

2.  BEWARE OF SETTLEMENT WITHOUT AN ATTORNEY REPRESENTING YOU.  Mr. Robin doesn’t like to litigate.  He’s a businessman who wants to collect the maximum amount of money for the least amount of work.  When he sues someone, and that person hires an attorney to put up a fight, Mr. Robin knows that he’s got to work hard to collect the debt.  In my opinion, Mr. Robin is much more likely to settle or dismiss a lawsuit if the Defendant hires an attorney.

If Mr. Robin’s office agrees to settle the debt, you’ve got to abide by “the golden rule of settlements.”  The golden rule with regard to debt settlements is simple:  “get it in writing!”   You should always have your own attorney review any proposed consent judgment or settlement agreement.   Mr. Robin’s office doesn’t represent you, so you should be skeptical about any proposed settlement offers.  The settlement should state that your credit will reflect that the account is settled and paid in full when the settlement amount is paid.

3.  KNOW YOUR OPTIONS.  When you’re sued, you have a variety of legal options.

First of all, meet with any attorney and explore any possible defenses to the lawsuit.  For example, it’s possible that the lawsuit was filed after expiration of the applicable statute of limitations.  If so, an Answer can be filed raising the defense, and the case can be thrown-out by virtue of a Motion to Dismiss or a Motion for Summary Judgment.

If the lawsuit was filed to recover a post-repossession deficiency on a repossessed vehicle, you may have several technical defenses based upon Georgia’s adaptation of the Uniform Commercial Code.  Did you receive a certified letter notifying you of your 10-day right of redemption?  Does the size of the deficiency imply that the vehicle wasn’t sold in a commercially reasonable manner?  These are defenses that your attorney can use to get the lawsuit tossed out of court.

4.  BANKRUPTCY AUTOMATICALLY STOPS LAWSUITS AND GARNISHMENTS.  Anoter powerful option is a chapter 7 or chapter 13 bankruptcy.  Our office can file a bankruptcy for as little as $344 down.  The mere filing of the bankruptcy will stop all collection activity, including the lawsuit or garnishment.   We do all the work.  Typically, you keep your assets, and you pay absolutely nothing to Mr.Robin or Cavalry Portfolio.  A chapter 7 or chapter 13 bankruptcy is designed to give you a fresh financial start.

The worst thing you can do is “nothing.”  That’s what Mr. Robin is hoping will happen – if you do nothing, they’ll get a default judgment against you; they’ll garnish your paycheck and put a lien on your property.  Fight back!!   If you’re looking for an aggressive advocate with years of experience; an attorney who enjoys fighting  Sherwin P. Robin, give me a call, or send me an e-mail.

Brian R. Cahn | brc@perrottalaw.com | 770-382-8900

Perrotta, Cahn & Prieto, P.C. | www.northgabankruptcy.com

Atlanta | Dallas | Cartersville | Calhoun | Cartersville

How to Beat a Lawsuit or Garnishment filed by Frederick J. Hanna & Associates – Fight Back!

Over the years, I have successfully  represented hundreds, maybe even  thousands, of clients sued or garnished by the collection firm of Frederick J. Hanna & Associates.  I’ve managed to help these clients in a variety of ways, whether it’s defending the lawsuit, or erasing the judgment through bankruptcy.

If you’ve been sued by Frederick J. Hanna & Associates, I can help.   Here’s some practical advice:

1.  KNOW YOUR ENEMY.  Frederick J. Hanna & Associates is not a creditor.  They’re a debt collector.  Because they’re a debt collector, you are entitled to the protections afforded to you by Fair Debt Collection Practices Act (“FDCPA”).    The FDCPA protects you from unfair and unreasonable collection tactics.  If a representative from Frederick J. Hanna & Associates has violated any of the FDCPA provisions, we can help you fight back.  We will not hesitate to sue Frederick J. Hanna & Associates on your behalf, seeking monetary damages for FDCPA violations.  Call our office for your free case analysis, and we will tell you if you’ve got a valid claim.

Frederick J. Hanna & Associates was investigated by the State of Georgia Office of Conumer Affairs for unfair and deceptice practices, and possible violations of the FDCPA.

Frederick J. Hanna & Associates was recently busted by a consumer attorney for filing lawsuits against consumers that had falsified signatures.

Specifically, Frederick J. Hanna & Associates was in the news because of their falsified court filings one of their mass-lawsuit filing attorneys, Dennis Henry.  Apparently, it had been uncovered that several of the lawsuit complaints filed in Gwinnett county in late 2010 supposedly did not bear the signature of Dennis Henry, but a forgery possibly done from within Frederick J. Hanna & Associates.  Complaints filed within our court system are supposed to be actually signed by the attorney filing them, not someone else signing their name.  On top of that, they were notarized too.  Sounds a lot like the robosigning going on else where in the country.  If debt collection attorenys are too lazy to even use their own hand to sign complaints, what makes you think they will put effort into “validating” your debt, as they are required to do pursuant to the FDCPA?

You should know that Frederick J. Hanna & Associates or its client has likely purchased your debt from the original creditor or another collector.  When purchasing debt, the buyer does not pay anywhere near 100% of the value of the note.  For example, if you owe $10,000 to the original creditor, it’s likely that Frederick J. Hanna & Associates or its client purchased the receivable for pennies on the dollar – maybe for as low as 15%, (or $1,500, in our example).  That means that you may be able to settle the matter for pennies on the dollar.  If Frederick J. Hanna & Associates bought the receivable for $1,500, they may settle for $3,000.  This is a “win-win” settlement.  You’ve just settled your debt for only 30% of your balance, and Frederick J. Hanna & Associates or its client has doubled their investment.

2.  BEWARE OF SETTLEMENT WITHOUT AN ATTORNEY REPRESENTING YOU.  The golden rule with regard to debt settlements is “get it in writing!”   You should always have your own attorney review any proposed consent judgment or settlement agreement.   Mr. Hanna’s office doesn’t represent you, so you should be skeptical about any proposed settlement offers.  The settlement should state that your credit will reflect that the account is settled and paid in full when the settlement amount is paid.

3.  KNOW YOUR OPTIONS.  When you’re sued, you have a number of options.

First of all, explore any possible defenses to the lawsuit.  For example, it’s possible that the lawsuit was filed after expiration of the applicable statute of limitations.  If so, an Answer can be filed raising the defense, and the case can be thrown-out by virtue of a Motion to Dismiss or a Motion for Summary Judgment

If the lawsuit was filed to recover a post-repossession deficiency on a repossessed vehicle, you may have several technical defenses based upon Georgia’s adaptation of the Uniform Commercial Code.  Did you receive a certified letter notifying you of your 10-day right of redemption?  Does the size of the deficiency imply that the vehicle wasn’t sold in a commercially reasonable manner?  These are defenses that we can explore.

4.  BANKRUPTCY AUTOMATICALLY STOPS LAWSUITS AND GARNISHMENTS.  Anoter option is a chapter 7 or chapter 13 bankruptcy.  Our office can file a bankruptcy for as little as $344 down.  The mere filing of the bankruptcy will stop all collection activity, including the lawsuit or garnishment.   We do all the work.  Typically, you keep your assets, and you pay absolutely nothing to Mr. Hanna and Associates.  A chapter 7 or chapter 13 bankruptcy is designed to give you a fresh financial start.

The worst thing you can do is “nothing.”  That’s what Hanna is hoping will happen – if you do nothing, they’ll get a default judgment and garnish your paycheck and put a lien on your property.  Fight back.   If you’re looking for an aggressive advocate with experience; an attorney who enjoys fighting  Frederick J. Hanna & Associates, give me a call, or send me an e-mail.

Brian R. Cahn | brc@perrottalaw.com | 770-382-8900

Perrotta, Cahn & Prieto, P.C. | www.northgabankruptcy.com

Atlanta | Dallas | Cartersville | Calhoun | Cartersville

Abogado con oficinas en Cartersville, Dallas, Calhoun y Dalton Georgia: Nos especializamos en las prácticas de Bancarrota; Ley Familiar; Ley Criminal; Testamentos y Fideicomisos; Accidentes de Auto; Negligencia y Abuso de Ancianos; Bienes y Raíces; y Compensación del Trabajador

DESPACHO DE ABOGADOS OFRECE SERVICIOS PARA LAS NECESIDADES LEGALES DE LA COMUNIDAD HISPANA

            En Perrotta, Cahn & Prieto, P.C. nos enfocamos en proporcionar representación legal ingeniosa por medio de atención individualizada a cada uno de nuestros clientes.  Nos especializamos en las prácticas de Bancarrota; Ley Familiar; Ley Criminal; DUI; Testamentos y Fideicomisos; Accidentes de Auto; Negligencia y Abuso de Ancianos; Bienes y Raíces; y Compensación del Trabajador.

Sirviendo al Norte de Georgia con oficinas en Cartersville, Dallas, Calhoun y Dalton.  Nuestras Asistentes Legales bilingües, Cristina Flores y Maria Salaices siempre están dispuestas a escucharle y ayudarle con sus necesidades legales.  Llámenos al 770-382-8900 para obtener su primera consulta gratis con uno de nuestros abogados.

Cristina Flores: cgf@perrottalaw.com   |  (678) 792-2025  |  Calhoun: (706) 629-9699  |  Cartersville:  (770) 382-8900  |  Dallas: (770) 445-1723

Maria Salaices: mes@perrottalaw.com  |   (678) 792-2267  |   Dalton: (706) 275-6022

www.NorthGaBankruptcy.com
www.PerrottaLaw.com

Brian R. Cahn: “General Order Staying Garnishments is needed for Chapter 7 Bankruptcy Cases”

It happens all the time.

When my clients make their initial consultation, it’s often because an aggressive creditor has filed a lawsuit, obtained a judgment, and started garnishing wages or bank accounts.

A garnishment can be devastating to an indivdual or family living paycheck-to-paycheck. Fortunately, a bankruptcy filing will stop the garnishment and allow the seized funds to be returned to the client.

The filing of a bankruptcy petition, whether chapter 7 or chapter 13, invokes the “automatic stay” codified in the Bankruptcy Code under 11 U.S.C. § 362(a). In a nutshell, the automatic stay is generally invoked immediately and automatically upon the filing of a bankruptcy petition. Therefore, once the bankruptcy case is filed, GARNISHMENTS are supposed to IMMEDIATELY STOP as a matter of law. The law is clear, but without a court order dismissing the garnishment or directing the bank or employer to release the funds, it’s not always easy to convince banks or employers to stop the garnishment or release the funds “automatically” or “immediately.”

It’s relatively easy to stop wage garnishments upon the filing of a chapter 13 bankruptcy in the Northern District of Georgia. A chapter 13 case, commonly referred to as a “wage earner plan,” involves submission of a weekly or monthly payment to creditors under a court-approved plan. The payments are deducted from the debtor’s paycheck pursuant to an “Employment Deduction Order” or “EDO.” Immediately upon the filing of a chapter 13 case, the Court issues an EDO, which is directed to the debtor’s employer. Here’s a link to the standard EDO form issued in the Northern District of Georgia.

The EDO instructs to employer to remit a set periodic payment to the chapter 13 trustee. Paragraph 4 of the Court-issued EDO contains the following language: “This order supersedes any previous order issued with respect to the debtor’s wages.” As a result of the EDO, which is usually issued within hours or days of filing of the chapter 13 case, the Employer has a clear and unambiguous mandate from the United States Bankruptcy Court, instructing the employer to STOP ANY PENDING WAGE GARNISHMENTS.

The real problem arises when a chapter 7 is filed in the Northern District of Georgia. Chapter 7 cases eliminate debt – there’s no EDO issued in the case. Most employers require a COURT ORDER stopping or dismissing the garnishment, or in the alternative, a DISMISSAL OF GARNISHMENT from the creditor. Since we don’t have an EDO, the debtor’s lawyerusually has to contact the attorney for the creditor responsible for the garnishment, and ask that attorney to DISMISS the garnishment. Many creditors attorneys are diligent, but it’s not uncommon for a creditors’ attorneys to take days, or weeks, before filing a dismissal. The delay often has catastrophic consequences when my clients need to pay their living expenses (utilities, insurance, house or car payments, etc.) and can’t get the garnishment lifted.

I am able to file various motions with the bankruptcy court, seeking a court order staying the garnishment, but these motions take 30 days minimum for a hearing, then several more days for entry of the order. If “justice delayed is justice denied,” then “money delayed is money denied.” I can also file a motion for contempt, if the creditor acted unreasonably or exercised control over my client’s funds. The problem, again, is the delay in ultimately recovering funds for my client, and the additional cost to my client for the additional legal work.

One of our neighboring jurisdictions – the United States Bankruptcy Court for the Western District of Tennessee – has SOLVED THE PROBLEM. That district allows the debtor’s attorney to cause an Order Staying Wage Garnishment to be immediately and automatically issued in a chapter 7 case, stopping all wage or bank account garnishments.

I can’t think of any reason for our District not to implement this form Order for chapter 7 cases. The Order simply follows the Code; specifically, the automatic stay. It’s time for our local bankruptcy attorneys and trustees to make a concerted effort to bring this problem, and the proposed solution, to the attention of our judges and clerk.

Feel free to e-mail me with any questions, or leave a comment below.

If you are being sued or garnished, please call my office for your free and confidential chapter 7, chapter 11 or chapter 13 bankruptcy consultation. I have offices in Cartersville, Atlanta, Dallas, Dalton and Calhoun.

Brian R. Cahn
(770) 382-8900
brc@perrottalaw.com
www.NorthGaBankruptcy.com
www.PerrottaLaw.com
Cartersville | Dallas | Dalton | Calhoun | Atlanta

Chapter 7 Bankruptcy: How do lawyers get paid?

Here’s the scenario: I’ve met with an attorney and discussed all the options. Chapter 7 bankruptcy seems to be the best option for me. Wipe-out tens of thousands of dollars in credit card debt, medical bills, back taxes, etc. Keep the car and house. This is a HUGE RELIEF. But wait, the fee for the bankruptcy is more than a thousand dollars – I don’t have any money!

Your first instinct may be to use a credit card. Yes, I’ve had dozens of clients ask me if they can charge their bankruptcy fees to a credit card with an available balance, or take a cash advance. Is this a good idea, or even legal? The answer is “no.” Section 523(a)(2) of the Bankruptcy Code provides that recent credit card charges or cash advances may not be dischargeable in a bankruptcy. In general, charges made on a credit card within 90 days of filing bankruptcy will not be eliminated by the bankruptcy. The policy behind the Section makes sense – it’s not fair to go crazy with the credit cards right before filing bankruptcy. Essentially, incurring charges without the intent to repay them is fraud.

The next instinct would be to ask your lawyer if he can file the case for a small down payment, then make payments on the balance. For a variety of reasons, this option is problematic in the context of a chapter 7. First of all, this arrangement creates a debtor-creditor relationship between you and your attorney. You owe your attorney the balance of the fee, so your attorney is a creditor – just like the credit card lenders and medical bills. In my opinion, this creates a conflict of interest. Your attorney needs to represent you against your creditors, and that’s difficult to do when he’s one of them.

Last week, one of my colleagues, an attorney from Rome, GA, filed a CLASS ACTION LAWSUIT against a high-volume bankruptcy firm – Clark & Washington (“C & W”). The lawsuit is filed on behalf of all clients of C & W that paid for their bankruptcy after it was filed through a series of post-dated checks. The lawsuit alleges that C & W’s collection of fees post-bankruptcy constitutes a violation of the automatic stay. The issues are complicated, because there’s a provision in the Bankruptcy Code that specifically ALLOWS a creditor to present a post-dated check for payment after a bankruptcy. Clearly, the ethical implications and threat of lawsuits should give any attorney pause before collecting post-filing fees.

Perrotta, Cahn & Prieto has a better solution. We allow our clients to make payment arrangements on their chapter 7 case. The case isn’t filed until the fees are paid, but we provide pre-bankruptcy legal representation to our clients as soon as we are paid the first dollar. In that regard, we notify collectors, pursuant to the Fair Debt Collections Practices Act (FDCPA) that all collection activity is to be directed to our firm, and not the client. If a lawsuit is filed, we help defend our clients. Our legal defense and resources give our clients the time and breathing room they need until the case is filed.

For a free consultation, contact our office today. (770) 382-8900

You can e-mail me directly with any questions. Brian R. Cahn brc@perrottalaw.com

We have offices located throughout Northwest Georgia, including Cartersville (serving Bartow County), Dalton (serving Whitfield, Murray and surrounding counties), Dallas (serving Cobb, Paulding, Polk and surrounding counties) and Calhoun (serving Gordon, Floyd and surrounding counties).

Brian R. Cahn
brc@perrottalaw.com
www.NorthGaBankruptcy.com
www.PerrottaLaw.com
Cartersville | Dallas | Dalton | Calhoun | Atlanta