Pending Legislation to Protect Creditor Fraud

This just posted on the NACBA newsletter regarding an important bill, S. 1054, "Fighting Fraud in Bankruptcy Act". This legislation will primarily operate to protect homeowners from dishonest mortgage banks, and compel the U.S. Trustee to ensure that mortgage companies are operating on the level.

"Senate Judiciary Committee Chairman Pat Leahy (D-VT), along with Senators Blumenthal (D-CT) and Whitehouse (D-RI) introduced legislation to strengthen the tools available to U.S. bankruptcy trustees to fight creditor fraud in bankruptcy court.  S. 1054, the “Fighting Fraud in Bankruptcy Act,” will bolster the EOUST’s ability to fight creditor fraud and protect homeowners in the bankruptcy process, while preventing needless litigation over its authority to do so.  The legislation will: (1) clarify that U.S. trustee has a duty to take action to remedy creditor abuse of the bankruptcy process; (2) permit the bankruptcy court, either on its own or in response to a motion from the trustee, to correct or sanction misconduct and fraud committed by creditors in the bankruptcy process; (3) empower the trustee to establish audit procedures to ensure that creditors are complying with the law; and (4) require a mortgage lender to certify under penalty of

 perjury that a foreclosure proceeding against active duty members of the military who are deployed is in compliance with the Servicemembers Civil Relief Act (SCRA)."   


This bill was also feature in a press release here. 

Please write your Senator asking them to vote in favor of this bill when it is presented to the Senate.

The author, Ben W. Koyl, is an attorney located in Chicago, IL. He is the principal of the Law Office of Ben W. Koyl, P.C. with offices located in the Chicago Loop, Beverly Woods / Blue Island, and Joliet, IL. The firm's website is http://www.chicagobklaw.com.