Article Abstract:
Bankruptcy filings have increased, along with bankruptcy costs and the number of fraudulent bankruptcy filings. Personal bankruptcy filings increased by an average of 39,600 per year between 1980 and 1988, and they are expected to increase by an average of 52,500 per year between 1991 and 1998. Bankruptcy costs totaled $12 billion for creditors and $1.5 billion for bank credit card issuers in 1988. Fraudulent bankruptcies have also increased, involving such tactics as transferring assets a shortly before filing for bankruptcy, and incurring debts without expecting to repay them. Visa USA has been attempting to decrease bankruptcies and bankruptcy fraud through a consumer education program and the Bankruptcy Recovery Program.
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Article Abstract:
The only viable alternative to bankruptcy is a debt management program (DMP) in which the original contract is renegotiated with payment over an extended period. The Portland, OR Consumer Credit Counseling Service (CCCS) reports a dramatic increase in DMP clients after beginning paid television advertising in 1983. The initial investment of $9,000 over six months resulting in 66 new DMP clients. The 1987 monthly investment of $7,000 produced 2,238 active DMPs. A controlled test of advertising in five cities and five comparable control cities will monitor the number of bankruptcies filed and the number of DMPs negotiated by CCCS offices during the first half of 1988.
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Article Abstract:
Public utilities may be facing bankruptcy judges who are not agreeing with the positions advocated by utilities. Bankruptcy judges should comply with state laws related to utilities' practices. In the case of Robinson, the bankruptcy court relied on Section 959(b) of the Bankruptcy code in deciding that Section 366(b) of the Bankruptcy Code did not preempt all state laws related to the termination of the services of a utility. In disputes involving Section 366(b), bankruptcy courts should ensure that their decisions fit within the scope of Section 959(b).
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