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An Iowa woman has been sentenced to prison after pleading guilty to bankruptcy concealment following an investigation by the FBI, the Des Moines Register reported. According to a news release from the U.S. Department of Justice, Debra Leisinger, 58, of Sumner in Bremer County admitted as part of a plea agreement in U.S. District Court for the Northern District of Iowa that after filing for Chapter 7 bankruptcy protection in December 2022 she concealed from creditors an inheritance check for $147,969.28. "As a part of her scheme, Leisinger attempted to discharge over $65,000 in debts that she owed to her creditors but keep her entire inheritance,” the release states. “Ultimately, the United States Trustee discovered Leisinger’s scheme, she waived her chapter 7 discharge, her bankruptcy was dismissed, her inheritance was applied to repay her creditors, and she was prosecuted federally.” Leisinger was sentenced on Dec. 21, 2023, to two months in prison and a two-year term of supervised release. She was also ordered to pay $5,000 in court fees.

A U.S. bankruptcy court judge this week dismissed the personal bankruptcy filing of Boston Market owner Jay Pandya and his wife, Mital, who had sought federal debt protection last month, RestaurantBusinessOnline.com reported. The dismissal came at the request of a U.S. bankruptcy trustee. The trustee said that Pandya had not provided insurance information on two properties he owned. They also said that Pandya had not responded to repeated requests for that information over a two-week period. The dismissal adds to the uncertainty over the future of Boston Market, which has closed as many as 200 locations this year, mostly due to evictions from landlords over unpaid bills. The company has been sued at least 140 times over the past three and a half years, since Pandya acquired the chain from Sun Capital Partners. Most of the lawsuits are over unpaid bills, from employees, landlords and various contractors. The biggest lawsuit is from US Foods, which has accused Boston Market of refusing to pay bills for food distribution. The distributor is asking a judge to award it nearly $12 million in that case. In his bankruptcy filing, Pandya said that he was not the sole owner of any business. But the filing also cited some of his business debts, including a $10 million US Foods liability.

The U.S. Supreme Court declined to hear a case over whether a bankruptcy judge can certify a nationwide class of individuals who allege Citigroup Inc. willfully violated their bankruptcy discharges, Bloomberg Law reported. The high court’s order yesterday leaves in place an August ruling by the U.S. Court of Appeals for the Second Circuit that freed Citi from facing a nationwide class action claim for allegedly refusing to correct the tradelines for consumers whose credit card debts were discharged in bankruptcy. The Second Circuit held that a bankruptcy court lacks the authority to hold a creditor in contempt for violating a debt discharge injunction issued by another bankruptcy court, and thus can’t grant broad relief to a nationwide class. Petitioner Kimberly Bruce said that the justices should hear the dispute because there’s nothing in the Bankruptcy Code that prohibits certification of a nationwide class of debtors or imposes the jurisdictional limitation outlined by the Second Circuit. Moreover, the August ruling stands in conflict with First Circuit precedent, she said. Bruce, who was initially permitted by the U.S. Bankruptcy Court for the Southern District of New York to bring a civil contempt claim against Citi on behalf of a nationwide class, said there’s no need to make thousands of class members return to hundreds of bankruptcy judges “to obtain the same relief against the same defendant.” Read more.

The Supreme Court will hill oral argument today in Office of the United States Trustee v. John Q. Hammons Fall 2006, LLC to determine whether the appropriate remedy for the constitutional uniformity violation found by this court in Siegel v. Fitzgerald is to require the United States Trustee to grant retrospective refunds of the increased fees paid by debtors in U.S. Trustee districts during the period of disuniformity, or is instead either to deem sufficient the prospective remedy adopted by Congress or to require the collection of additional fees from a much smaller number of debtors in Bankruptcy Administrator districts. Click here to listen to the argument today at 10 a.m. ET.

A bankruptcy attorney appeared in U.S. District Court in St. Louis on Wednesday to answer charges accusing him of defrauding the state of Missouri and lending institutions, according to DOJ press release. Michael Toscano was indicted on Dec. 20, 2023, in U.S. District Court in St. Louis on three counts of mail fraud and one count of wire fraud. He turned himself in yesterday and pleaded not guilty to the charges. The indictment alleges that from roughly April 1, 2018, though Dec. 19, 2023, Toscano devised a scheme to defraud the state of Missouri and lending institutions by falsely claiming bankruptcy filers’ vehicles had been abandoned, and then selling some through his used car dealership. Toscano also obtained referrals from other bankruptcy attorneys whose clients sought to surrender their vehicles to creditors rather than to continue to pay their vehicle car loans, according to statements made in court on Wednesday. Toscano told debtors to deliver their vehicles to his office in Creve Coeur or to a St. Charles County storage facility, the indictment says. He also picked up some vehicles that were inoperable, it says. Toscano then mailed documents to the Missouri Department of Revenue and the holders of liens on the vehicles falsely claiming that they had been abandoned and that he’d incurred towing and storage fees, the indictment says. He demanded payment, writing that he would seek an abandoned motor vehicle title or mechanic’s lien if the fees were not paid within 30 days, the indictment says. In some cases, Toscano delayed notifying lienholders for as long as 45 days, causing storage fees to exceed $2,300, the indictment says. If payment was not made, Toscano submitted false and fraudulent documents to the contract license offices of the DOR seeking the issuance of abandoned vehicle titles or mechanic lien titles and then offered the vehicles for sale through his used car dealership, the indictment says.