Atlanta Bankruptcy Law Blog

We all remember that "Jerry Maguire" line, "Show me the money!" However, did Georgia residents know that the 1996 blockbuster was based on a real man? Leigh Steinberg, a sports agent whose former client list includes notable athletes like Oscar De La Hoya, has recently filed for Chapter 7 bankruptcy. Steinberg filed for bankruptcy when the Orange County Superior Court commissioner issued a bench warrant. In the past, the agent did not show up to court to address his $1.4 million debt.

Steinberg allegedly stopped paying for an office back in 2009, according to sources. He claims that financial trouble was a result of his 2008 divorce. Furthermore, the agent lost track of his finances while he was in rehab. As a result, he has confronted many legal matters over several unpaid bills.

Celebrity news outlets are not just reporting on divorces and custody battles these days. A number of financial dramas are playing out in the entertainment industry, and some big names have been hit with state and federal tax liens. In a few cases, the tax debts are tied to divorces and child support payments.

Locally, the Georgia Department of Revenue has filed a tax lien against singer-producer The-Dream. At issue is the 34-year-old's tax bill from 2007, when The-Dream reportedly didn't pay about $60,500 in income taxes. Interest has accrued and fees have accumulated over the past few years, and The-Dream now owes more than $117,000.

The Banking and Finance Committee of the Georgia State Senate resurrected a bill last week that its authors hope will smooth out some rough spots in foreclosure registries around the state. The bill would establish new registry guidelines and would place a limit on local fees charged to owners of properties in foreclosure. The full Senate may vote to advance the bill (House Bill 110) fairly soon.

During the foreclosure crisis, cities and counties realized that these distressed properties were falling into disrepair. The mere fact of a foreclosure in a neighborhood will have a negative effect on area home values; a rundown home will only exacerbate the problem.

We are talking about the recent decision by JPMorgan Chase & Co. that surprised credit card industry insiders and consumer advocates alike. The bank stopped filing collection lawsuits against credit cardholders. While the bank has offered no explanation, some speculate that documentation and legal problems are behind it.

Those documentation issues include allegations of robo-signing, a term Georgia is familiar with. According to one consumer advocate, the robo-signing problem in the mortgage industry was dwarfed in comparison to the problems in the credit card industry.

Anyone in Atlanta who has been seriously delinquent with credit card payments probably knows that banks will often file lawsuits against consumers to collect on the debt. Generally, the suits aren't worth more than a few thousand dollars each. The bank, though, is thinking about the big picture: Multiply that thousand dollars by a few thousand debtors, and those collection lawsuits can add up.

They can really add up. From lawsuits and other collection activities, JPMorgan Chase & Co. recovered $1.4 billion last year. When Chase backed off on collection suits, then, both the industry and consumer advocates raised their eyebrows.

We are picking up the discussion from our Dec. 21 post about a new rule adopted by the Federal Reserve Board. As we explained, rules (also called regulations) put the meat on the bones of laws passed by Congress. The law we've been talking about is the 2009 Credit CARD Act, and the rule could have a negative effect on some borrowers who are trying to rebuild their credit or even just to establish a credit history.

The rule requires credit card applicants age 21 or older to show the "independent ability to pay." Critics -- including Atlanta's own Home Depot -- say the rule significantly narrows the language of the law. The CARD Act calls for people 21 or older to show that they can pay according to the terms of the credit agreement.

So many organizations remind us that this is the time of year to give -- give cash, add donations to estate plans, drop toys or winter coats in collection bins and so on. Cash-strapped Atlantans may want to participate, but one look at their checkbooks convinces them otherwise. The holidays can mean tapped out credit cards and missed mortgage payments for some homeowners.

Charitable organizations like Habitat for Humanity are reporting an uptick in donations from those homeowners, though. They are choosing to donate their homes rather than go through foreclosure.

We are continuing our discussion from our last post. The Federal Reserve Board has issued a rule that lawmakers believe runs counter to the spirit of the law. The law is the 2009 Credit CARD Act. The rule, according to a group U.S. Representatives and a large number of retailers, will make it difficult, if not impossible, for stay-at-home spouses to establish a credit history or to rebuild their credit.

The law was meant to protect consumers. This is the law that put limits on fees and prohibited card companies from raising interest rates without notice or imposing different interest rates for different purchases.