Summary:
The Debtor, who suffers from a learning disability, called telephone directory assistance asking to be connected with “legal aid.” The operator connected him with “Legal Aid Alternatives”, which then referred him Glenda Ocasio. Ms Ocasio charge the Debtor $399 to prepare his Chapter 7 bankruptcy petition. She told the Debtor that she would be representing him in the bankruptcy case, that he would be able to keep all of his assets; that he did not need an attorney; that he should file under chapter 7; and that all of his debts would be discharged. Ms. Ocasio also filed several reaffirmation agreements on the debtor’s behalf, without his knowledge. The Debtor loss of substantial non-exempt assets because of this case.
The Bankruptcy Court first reiterated that the maximum fee for a bankruptcy petition preparer is $80.00. See In re Moore, 283 B.R. 852, 859 (Bankr. E.D.N.C. 2002). The Bankruptcy Court also found that Ms. Ocasio had violated the requirements of 11 U.S.C. §§ 110(e)(2)(A), (f), (h)(1) and (5), (i)(1), and (k) in violation of 11 U.S.C. §110(e)(2)(A) and sanctioned her in the amount of $6,249.00 and, because she had also been sanctioned by the Middle District of Georgia Bankruptcy Court for the same violations, Ms. Ocasio was permanently enjoined from acting as a bankruptcy petition preparer.
Even without having had the advice of an attorney, the Debtor’s request to have the case dismissed was denied, as the Bankruptcy Court found he had intended to file bankruptcy and “must take some responsibility for his actions.”
Commentary:
While the Bankruptcy Court did find that Ms. Ocasio had provided legal advice in violation of N.C.G.S. § 84-4, it is not clear that this matter was referred to the appropriate District Attorney under N.C.G.S. § 84-7 for further injunction and criminal prosecution.
For a copy of the opinion, please see:
Johnson-Bankruptcy Petition Preparer.pdf
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