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FEDERAL RESERVE PLANS TO BUY $40 BILLION IN MORTGAGE SECURITIES A MONTH



The Federal Reserve said today that it will expand its holdings of long-term securities with open-ended purchases of $40 billion of mortgage debt a month in a bid to boost growth and reduce unemployment, Bloomberg News reported today. "If the outlook for the labor market does not improve substantially, the committee will continue its purchases of agency mortgage-backed securities, undertake additional asset purchases and employ its other policy tools as appropriate," the Federal Open Market Committee said today. The FOMC said it would likely hold the federal funds rate near zero "at least through mid-2015." Since January, the Fed had said that the rate was likely to stay low at least through late 2014. The Fed also said it will continue its program to swap $667 billion of short-term debt with longer-term securities to lengthen the average maturity of its holdings, an action dubbed “Operation Twist.” The central bank will also continue reinvesting its portfolio of maturing housing debt into agency mortgage-backed securities. Read more.

FORECLOSURE STARTS FELL ON ANNUAL BASIS IN AUGUST



Foreclosure listing firm RealtyTrac Inc. said that fewer homes were placed on the foreclosure track last month than in August last year, when they hit a 17-year high, the Associated Press reported yesterday. More than 99,400 homes entered the foreclosure process in August 2012, up 1 percent from July but down 13 percent from August last year, RealtyTrac said. At the same time, foreclosure starts increased almost exclusively in judicial states like Florida and New York, where the courts must sign off on foreclosures, the firm said. Conversely, in many non-judicial states like California and Arizona, the number of foreclosure starts declined versus August last year. Read more.

ANALYSIS: INVESTMENT FIRMS FLOCK TO FORECLOSURE AUCTIONS



The business of buying foreclosed homes, renovating and renting them out is morphing from a largely mom-and-pop business into the next big thing on Wall Street, according to a report in yesterday's Wall Street Journal. Investors who once chased only big-ticket deals now are buying houses one at a time. According to investment bank Jefferies & Co., major financial firms led by Colony Capital LLC, Blackstone Group LP, Och-Ziff Capital Management and Oaktree Capital Group LLC have raised more than $8 billion to buy houses, largely in markets pummeled by the housing crisis. At first, many investors hoped lenders would sell foreclosed houses in bulk. But most banks prefer to sell one house at a time, figuring that approach will fetch higher prices. As a result, the foreclosure circuit has not yet produced a giant windfall for buyers like Colony, though executives say early returns are promising. Yields on rents from houses owned by the firm are 7 to 8 percent, higher than many other types of real estate. Purchase prices have averaged 12 percent less than Colony expected, which should make it easier to sell the homes or borrow against them and exit with double-digit percentage gains. Read more. (Subscription required.)

REPORT: FINANCIAL CRISIS, RECESSION COST U.S. $12.8 TRILLION



The financial crisis and the Great Recession have taken a heavy toll on the U.S., and now public interest group Better Markets, which supports tougher financial regulations, said that it has calculated that cost to be at least $12.8 trillion, the Los Angeles Times reported today. The report tries to calculate the effect of the crisis and the recession in terms of reduced economic output and the costs of stabilizing the markets and bailing out banks and large financial firms. The estimate builds off previous calculations, including one by economists Alan S. Blinder and Mark Zandi. Blinder and Zandi released a report in 2010 estimating the total budgetary cost of the financial crisis to be $2.35 trillion. Better Markets used that amount as a jumping-off point for what it said was a conservative estimate of the true costs of the crisis. The group estimated that the loss in gross domestic product from 2008 to 2018 will be $7.6 trillion. Then they used the estimates of Blinder and Zandi to add an additional figure: an estimate of how much GDP loss was avoided by government bailouts and other interventions. That figure was $5.2 trillion from 2008 to 2012. Read more.

COMMENTARY: WHY MARKETS NEED "NAKED" CREDIT DEFAULT SWAPS



Many regulators, politicians and academics are recommending a ban on "naked" credit default swap (CDS) purchases, but the premise that only sovereign-debt holders suffer when a country defaults is false, according to a commentary in the Wall Street Journal yesterday. Many other agents are adversely affected by a default, and they should be allowed to purchase sovereign CDS, according to the commentary. A 2006 Bank of England study found that the output losses for 45 sovereign debt defaults between 1970 and 2000 "appear to be very large—around 7 percent a year on the median measure—as well as long lasting." The haircut taken by investors after sovereign defaults ranges from 20-70 percent. But many bystanders in the sovereign-default drama also suffer significant losses of wealth and livelihood. Domestic importers and foreign exporters suffer when the default is accompanied by a devaluation. Financial institutions and holders of domestic corporate debt suffer as their asset values fall. Domestic companies suffer as their credit risk increases, with smaller businesses being especially harmed as banks reduce loan availability. Read the full commentary. (Subscription required.)

REPORT: HOUSEHOLD INCOME SINKS TO 1995 LEVEL



A report from the Census Bureau yesterday said that annual household income fell in 2011 for the fourth straight year to an inflation-adjusted $50,054, an amount last approached in 1995, the Wall Street Journal reported today. Median annual household income—the figure at which half are above and half below—now stands 8.9 percent below its all-time peak of $54,932 in 1999, at the end of the 1990s economic expansion. Other measures of well-being in the report were more positive. The poverty rate, which had risen in the past four years, held steady in 2011, and the number and share of people without health insurance fell. The shift in health coverage is in large part due to more Americans getting covered by government programs, such as Medicare. Read more. (Subscription required.)

ABI IN-DEPTH

ABI MEMBERS WELCOME TO ATTEND ACB'S FREE HALF-DAY "BANKRUPTCY: BACK TO THE FUTURE" PROGRAM IN SEPTEMBER



The American College of Bankruptcy invites you to attend a free half-day program on Sept. 28 in Chicago for a discussion of many of the challenging topics facing current bankruptcy and reorganization professionals. Topics to be addressed include recent decisions of the U.S. Supreme Court and Court of Appeals, important work of the Advisory Committee on Bankruptcy Rules, and developments in the field of bankruptcy ethics. The nation’s leading judges, academics and bankruptcy professionals are among the speakers for the program. While there is no cost to attend, seating is limited, so early reservation is suggested. For more information and to register, please click here.

LATEST CASE SUMMARY ON VOLO: LEFKOWITZ V. MICHIGAN TRUCKING LLC (IN RE GAINEY CORP.; 6TH CIR.)



Summarized by Omid Moezzi from the Office of Nancy Curry, Chapter 13 Trustee

The Sixth Circuit affirmed the bankruptcy court's ruling for an order dismissing the appellant's (the liquidation trustee) adversary complaint for failure to state a claim for relief pursuant to Federal Rule of Civil Procedure 12(b)(6).

There are more than 600 appellate opinions summarized on Volo, and summaries typically appear within 24 hours of the ruling. Click here regularly to view the latest case summaries on ABI’s Volo website.

NEW ON ABI’S BANKRUPTCY BLOG EXCHANGE: WHOSE FAULT IS IT THAT PONZI SCHEMES THRIVE?



The Bankruptcy Blog Exchange is a free ABI service that tracks 35 bankruptcy-related blogs. A recent blog post examines how defrauded investors are increasingly directing their blame at the SEC for failing to detect ponzi schemes.

Be sure to check the site several times each day; any time a contributing blog posts a new story, a link to the story will appear on the top. If you have a blog that deals with bankruptcy, or know of a good blog that should be part of the Bankruptcy Exchange, please contact the ABI Web team.

ABI Quick Poll

Bankruptcy courts should have unfettered discretion in adjusting fee applications, even when no party-in-interest has raised objections.

Click here to vote on this week's Quick Poll. Click here to view the results of previous Quick Polls.

HAVE YOU TUNED IN TO BLOOMBERG LAW'S VIDEO PODCASTS?



Bloomberg Law's video podcasts feature top experts speaking about current bankruptcy topics. The podcasts are available via Bloomberg Law's YouTube channel so that you can access the programs from your computer or device of your choice! Click here to view the Bloomberg Law video podcasts.

INSOL INTERNATIONAL



INSOL International is a worldwide federation of national associations for accountants and lawyers who specialize in turnaround and insolvency. There are currently 37 member associations worldwide with more than 9,000 professionals participating as members of INSOL International. As a member association of INSOL, ABI's members receive a discounted subscription rate. See ABI's enrollment page for details.

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September

- 38th Annual Lawrence P. King and Charles Seligson Workshop on Bankruptcy & Business Reorganization

     September 19-20, 2012 | New York, N.Y.

- "When Is an Individual Chapter 11 the Best Fit?" Live Webinar

     September 27, 2012

- American College of Bankruptcy's "Bankruptcy: Back to the Future" Program

     September 28, 2012 | Chicago, Ill.

October

- Nuts & Bolts for Young and New Practitioners - KC

     October 4, 2012 | Kansas City, Mo.

- Midwestern Bankruptcy Institute Program, Midwestern Consumer Forum

     October 5, 2012 | Kansas City, Mo.

- Bankruptcy 2012: Views from the Bench

     October 5, 2012 | Washington, D.C.

- Chicago Consumer Bankruptcy Conference

     October 8, 2012 | Chicago, Ill.

- "Trending Issues: Examiners and Select Plan Confirmation Issues" Webinar

October 15, 2012

- International Insolvency and Restructuring Symposium

     October 18, 2012 | Rome, Italy

November

- U.S./Mexico Restructuring Symposium

     November 7, 2012 | Mexico City, Mexico

- Professional Development Program

     November 9, 2012 | New York, N.Y.

- Detroit Consumer Bankruptcy Conference

     November 12, 2012 | Detroit, Mich.

- Winter Leadership Conference

     November 29 - December 1, 2012 | Tucson, Ariz.

December

- Forty-Hour Bankruptcy Mediation Training

     December 4-8, 2012 | New York, N.Y.

2013

February

- Kansas City Advanced Consumer Bankruptcy Practice Institute

     February 17-19, 2013 | Kansas City, Mo.

U.S. MORTGAGE, CREDIT CARD DELINQUENCY RATES DECLINE



TransUnion Corp. reported today that the delinquency rates for mortgages and credit cards declined during the second quarter, and the firm predicts mortgage-delinquency rates will maintain their downward trajectory for the remainder of 2012, according to Dow Jones Newswires. The national mortgage delinquency rate--or the rate of borrowers at least 60 days past due--dropped for the second consecutive quarter, to 5.49 percent from the 5.78 percent mortgage delinquency rate in the first quarter. Between the first and second quarters of 2012, all but five states experienced decreases in their mortgage-delinquency rates, and 76 percent of metropolitan areas saw improvement in their mortgage-delinquency rates during the second quarter. Meanwhile, the national credit card delinquency rate--or the ratio of borrowers at least 90 days past due--dropped to 0.63 percent in the second quarter from 0.73 percent in the previous quarter. The credit card delinquency rate is at its lowest level since reaching 0.6 percent a year earlier. Read more.

COMMENTARY: THE GOVERNMENT SHOULD LOOK TO MASS MORTGAGE REFINANCING



With principal writedown no longer an option, the government needs to find a new way to facilitate mass mortgage refinancings, according to a commentary in today's New York Times by Prof. Joseph E. Stiglitz of Columbia University and Mark Zandi of Moody's Analytics. Refinancing at the current low rates would allow homeowners to significantly reduce their monthly payments, and a mass refinancing program would work like a potent tax cut. Refinancing would also significantly reduce the chance of default for underwater homeowners, according to the commentary. With fewer losses from past loans burdening their balance sheets, lenders could make more new loans, and communities plagued by mass foreclosures might see relief from blight. Read the full commentary.

DURBIN SEES VISA ACCORD THWARTING PUSH TO CAP CREDIT CARD FEES



Senator Richard Durbin (D-Ill.)'s office told retailers that their efforts to have Congress rein in credit card swipe fees would be imperiled if they support a $6.6 billion antitrust settlement with Visa Inc. and MasterCard Inc., Bloomberg News reported yesterday. "This is going to foreclose the prospect of good legislation for the foreseeable future," Dan Swanson, senior judiciary counsel for Durbin, said in a conference call with the Food Marketing Institute. Durbin, the Senate Majority Whip, won the inclusion of limits on debit-card swipe fees, or interchange, in the 2010 Dodd-Frank Act. That trimmed annual revenue for the biggest U.S. banks by about $8 billion and benefited retailers including Wal-Mart Stores Inc. and Target Corp. Credit-card swipe fees are higher and generate about $40 billion a year for lenders such as JPMorgan Chase & Co., Bank of America Corp. and Citigroup Inc. The Food Marketing Institute, a trade group whose members include Target, Sears Holdings Corp. and Wal-Mart, does not have a position on the settlement. Visa, MasterCard and banks agreed last month to resolve the seven-year-old case, one of the largest class actions in history. The deal, which requires the approval of U.S. District Judge John Gleeson in Brooklyn, N.Y., may be nullified if enough merchants refuse to join the proposed class action. Read more.

MUNICIPAL BOND RULE MIRED IN LEGISLATIVE LIMBO



A provision of the Dodd-Frank Act that would require municipal bond advisers to put the interests of taxpayers first has been bogged down in a rule-making quagmire in Washington, D.C., the New York Times reported today. As part of the wide-ranging regulatory changes that followed the financial crisis of 2008, the Dodd-Frank Act included a provision that would make municipal advisers "fiduciaries," meaning they must put local residents’ interests ahead of their own. Making advisers fiduciaries would be “the first time in the history of the securities laws that issuers of the securities have been protected,” said Robert W. Doty, president of AGFS, a consulting firm in Sacramento. He is a registered municipal adviser and favors the fiduciary mandate. But before that provision can take effect, the law calls for the Securities and Exchange Commission to define "municipal adviser." The SEC proposed a definition 20 months ago, but it was swiftly beaten back by the banking, brokerage and engineering industries, among others. Opponents argued that the SEC was overreaching and that they were already regulated and should not be given a new mandate. Additionally, Rep. Robert J. Dold (R-Ill.) introduced a bill last year that would eliminate the measure. Read more.

ANALYSIS: HARD TIMES SPREAD FOR CITIES



Fiscal woes that have caused high-profile bankruptcies in California are surfacing across the country as municipalities struggle with uneven growth and escalating health and pension costs following the worst recession since the 1930s, the Wall Street Journal reported today. Budget crunches already have prompted Michigan lawmakers to authorize emergency fiscal managers, and led the mayor of Scranton, Pa., to temporarily cut the pay of all city workers to the minimum wage. In a majority of the nation's 19,000 municipalities—urban and rural, big and small—stagnant property tax revenues, diminish aid from states and rising costs are forcing less dramatic but still difficult steps. Moody's Investors Service recently said that while municipal bankruptcies are likely to remain rare, it warned of a "a small but growing trend in fiscally troubled cities unwilling to pay their debt obligations." Read more. (Subscription required.)

ABI MEMBERS WELCOME TO ATTEND ACB'S FREE HALF-DAY "BANKRUPTCY: BACK TO THE FUTURE" PROGRAM IN SEPTEMBER



The American College of Bankruptcy invites you to attend a free half-day program on Sept. 28 in Chicago for a discussion of many of the challenging topics facing current bankruptcy and reorganization professionals. Topics to be addressed include recent decisions of the U.S. Supreme Court and Court of Appeals, important work of the Advisory Committee on Bankruptcy Rules, and developments in the field of bankruptcy ethics. The nation’s leading judges, academics and bankruptcy professionals are among the speakers for the program. While there is no cost to attend, seating is limited, so early reservation is suggested. For more information and to register, please click here.

ABI IN-DEPTH

LATEST CASE SUMMARY ON VOLO: FIRST PREMIER CAPITAL LLC V. REPUBLIC BANK OF CHICAGO (IN RE EQUIPMENT ACQUISITION RESOURCES; 7TH CIR.)



Summarized by Allen Guon of Shaw Gussis Fishman Glantz Wolfson & Towbin LLC

Seventh Circuit Court of Appeals affirmed the district court's ruling, which affirmed the bankruptcy court's ruling, that the granting of the settlement motion was not an abuse of discretion.

There are 600 appellate opinions summarized on Volo typically within 24 hours of the ruling. Click here regularly to view the latest case summaries on ABI’s Volo website.

NEW ON ABI’S BANKRUPTCY BLOG EXCHANGE: FIFTH CIRCUIT HOLDS STATE AGENCY PROCEEDINGS EXEMPT FROM AUTOMATIC STAY



The Bankruptcy Blog Exchange is a free ABI service that tracks 35 bankruptcy-related blogs. A recent post examines the Fifth Circuit’s ruling on June 18 in Halo Wireless, Inc. v. Alenco Communications, Inc., et al., affirming a bankruptcy court order that various state public utility commission proceedings initiated against Halo could proceed despite Halo’s subsequent chapter 11 bankruptcy.

Be sure to check the site several times each day; any time a contributing blog posts a new story, a link to the story will appear on the top. If you have a blog that deals with bankruptcy, or know of a good blog that should be part of the Bankruptcy Exchange, please contact the ABI Web team.

ABI Quick Poll

The Twombly/Iqbal rule for pleading ‘plausible’ claims has been applied too stringently in dismissing avoidance actions for failure to state a claim.

Click here to vote on this week's Quick Poll. Click here to view the results of previous Quick Polls.

HAVE YOU TUNED IN TO BLOOMBERG LAW'S VIDEO PODCASTS?



Bloomberg Law's video podcasts feature top experts speaking about current bankruptcy topics. The podcasts are available via Bloomberg Law's YouTube channel so that you can access the programs from your computer or device of your choice! Click here to view the Bloomberg Law video podcasts.

INSOL INTERNATIONAL



INSOL International is a worldwide federation of national associations for accountants and lawyers who specialize in turnaround and insolvency. There are currently 37 member associations worldwide with more than 9,000 professionals participating as members of INSOL International. As a member association of INSOL, ABI's members receive a discounted subscription rate. See ABI's enrollment page for details.

Have a Twitter, Facebook or LinkedIn Account?

Join our networks to expand yours.

September

- 7th Annual Golf and Tennis Outing

     September 11, 2012 | Maplewood, N.J.

- Complex Financial Restructuring Program

     September 13-14, 2012 | Las Vegas, Nev.

- Southwest Bankruptcy Conference

     September 13-15, 2012 | Las Vegas, Nev.

- 38th Annual Lawrence P. King and Charles Seligson Workshop on Bankruptcy & Business Reorganization

     September 19-20, 2012 | New York, N.Y.

- American College of Bankruptcy's "Bankruptcy: Back to the Future" Program

     September 28, 2012 | Chicago, Ill.

October

- Nuts & Bolts for Young and New Practitioners - KC

     October 4, 2012 | Kansas City, Mo.

- Midwestern Bankruptcy Institute Program, Midwestern Consumer Forum

     October 5, 2012 | Kansas City, Mo.

- Bankruptcy 2012: Views from the Bench

     October 5, 2012 | Washington, D.C.

- Chicago Consumer Bankruptcy Conference

     October 8, 2012 | Chicago, Ill.

- "Trending Issues: Examiners and Select Plan Confirmation Issues" Webinar

     October 15, 2012

- International Insolvency and Restructuring Symposium

     October 18, 2012 | Rome, Italy

November

- U.S./Mexico Restructuring Symposium

     November 7, 2012 | Mexico City, Mexico

- Professional Development Program

     November 9, 2012 | New York, N.Y.

- Detroit Consumer Bankruptcy Conference

     November 12, 2012 | Detroit, Mich.

STOCKTON EXPERIENCED YEARS OF UNRAVELING PRIOR TO BANKRUPTCY



Stockton, Calif., recently became the largest city in the country to declare bankruptcy, but evidence of its unraveling has been mounting for years, the New York Times reported today. Housing prices shot up in the early 2000s, when commuters from the San Francisco Bay area bought and built homes in Stockton. After the bubble burst, the median home price plummeted by more than 60 percent in the last five years. In the first half of this year, the city had the highest foreclosure rate of any in the country, according to RealtyTrac. The unemployment rate has hovered around 17 percent for the last few years, nearly double the national average. While Stockton’s bankruptcy troubles can be traced in part to the collapse of the housing market and the subsequent erosion of the city's tax base, for years city leaders also mismanaged and overspent funds, pushing the city into financial peril, analysts and current city officials say. Stockton cannot afford the $417 million it owes for retiree health benefits, city officials say, and this year a bank repossessed city-owned parking garages and a $40 million building the city had bought intended to house an upgraded City Hall. Since 2009, the city has cut 25 percent of its police officers, 30 percent of its Fire Department and over 40 percent of all other city employees. Read more.

CALIFORNIA'S "CHARTER" CITIES ARE UNDER THE MICROSCOPE



The last three large California cities to seek bankruptcy protection are all "charter cities," and now another charter city, Compton, says that it may have to file for bankruptcy by September, the Wall Street Journal reported today. Of California's 482 cities, 121 have their own constitutions, or charters. That gives them more leeway in governing their own affairs, including the freedom to set their own rules about elections, salaries and contracts. But that autonomy may be at the root of some of their fiscal problems, some experts say. Charter cities are exempt from state laws that mandate salary limits for elected officials. These cities also were free during good times to include generous worker pay and staffing agreements in their charters that can be difficult to alter quickly during financial duress. Read more. (Subscription required.)

FORECLOSURE CRISIS HITTING OLDER AMERICANS



A new AARP report says that more than 1.5 million older Americans have already lost their homes, with millions more at risk as the national housing crisis takes its toll on those who are among the worst positioned to weather the storm, the Associated Press reported today. According to AARP:

• Nearly 600,000 people who are 50 years or older are in foreclosure.

• About 625,000 in the same age group are at least three months behind on their mortgages.

• Nearly 3.5 million — 16 percent of older homeowners — are underwater, meaning their home values have gone down and they now owe more than their homes are worth.

AARP said that over the past five years, the proportion of loans held by older Americans that are seriously delinquent jumped by more than 450 percent. Homeowners who are younger than 50 have a higher rate of serious delinquency than their older counterparts. But the rate is increasing at a faster pace for older Americans than for younger ones, according to AARP’s analysis of more than 17 million mortgages. Read more.

Click here to read AARP's press release on the report.

COMMENTARY: THE CFPB’S NEW MORTGAGE DISCLOSURES ARE A BUST



The Consumer Financial Protection Bureau's (CFPB) "Mortgage Disclosure Team" just came out with two proposed forms that are supposed to make things easier for borrowers, but lenders, including nonprofit Habitat for Humanity, are concerned that the new forms will impede their ability to enable low-income families to become homeowners, according to a commentary in today's Wall Street Journal. The CFPB is proposing to replace the old mortgage disclosure forms with a new Loan Estimate Form and Closing Disclosure Form. However, any lender, including organizations such as Habitat, is at legal risk if they try to help low-income borrowers who lack the ability to repay their loans. The new rules would also forbid many borrowers from making smaller payments every month, followed by a single, one-time balloon payment to retire the principal at the end, according to the commentary. Read more. (Registration required.).

STUDENT DEBT HITS THE MIDDLE-AGED



Student debt is rising sharply among all age groups, but middle-aged Americans appear to be struggling the most with payments, according to new data released on Tuesday by the Federal Reserve Bank of New York, the Wall Street Journal reported yesterday. The delinquency rate—or the percentage of debt on which no payment has been made for 90 days—was 11.9 percent for debt held by borrowers aged 40 to 49 as of March. That compares with a rate of 8.7 percent for borrowers of all ages. Two-thirds of the nation's $900 billion in student debt is held by Americans under 40, the Fed estimates. But borrowers over 40 are having a particularly tough time with student debt for several reasons, consumer and higher-education experts say. Many debtors over 40 are still paying balances incurred years ago from college, while their home values and savings have declined sharply in recent years. An Education Department program that provides loans to parents to fund their kids' education is also among the fastest-growing of the government's education loan programs. Read more. (Subscription required.)

REPORT: PENSION UNDERFUNDING ON THE RISE



The amount by which pensions at S&P 500 companies are underfunded grew from $245 billion to $355 billion between 2010 and 2011, according to a new report from Standard & Poor's, CongressDaily reported today. Additionally the transportation bill Congress passed at the end of June included a pension provision that broadened the timeline used to calculate how much companies should stow away to cover pension obligations. The longer timeline reduces the short-term impact of the recession, freeing up cash for companies to spend (and the government to tax). But the benefits are fleeting: "It appears that Congress was willing to permit future payments to obtain tax receipts now, even though the expected net return would turn negative after five years," according to the report. Read more.

COMMENTARY: KEEPING CREDIT BUREAUS IN CHECK



The Consumer Financial Protection Bureau (CFPB) on Sept. 30 will start supervising credit reporting agencies, including the big three: Equifax, TransUnion and Experian, according to a commentary in yesterday's Washington Post. For years, consumer advocates have complained that the information collected often includes errors. Under the Fair Credit Reporting Act, the bureaus and any businesses supplying them with data must correct inaccurate information. The bureaus, in turn, are required to put systems in place that allow consumers to dispute information. However, surveys have shown that getting erroneous information removed from credit files can be an exasperating experience. The credit bureau industry claims that most reports are accurate, but one problem with the system, according to the commentary, is that the bureaus rely on information provided to them by companies seeking to collect debts. The CFPB will supervise credit reporting agencies that have more than $7 million in annual receipts. This means that the agency's authority will cover about 30 companies that account for about 94 percent of the market. The three major credit bureaus issue more than 3 billion consumer reports a year and maintain files on more than 200 million Americans, the CFPB said. Read more.

ABI IN-DEPTH

“SUBJECTING BUSINESS PROJECTIONS TO SCRUTINY IN VALUATION DISPUTES” WEBINAR TO BE HELD ON JULY 30!



Reassembling the speakers from the highest-rated panel at the New York City Bankruptcy Conference this year, ABI will be holding a live webinar on July 30 at 11 a.m. ET titled, "Subjecting Business Projections to Scrutiny in Valuation Disputes." Panelists include:

• Moderator David Pauker of Goldin Associates, LLC (New York)
• Martin J. Bienenstock of Proskauer (New York)
• David M. Hillman of Schulte Roth & Zabel LLP (New York)
• Bankruptcy Judge Robert E. Gerber (S.D.N.Y.)

The panel will address:

• How much deference should management projections be accorded?
• How do you determine whether projections are unrealistically optimistic or pessimistic?
• What is the relevance of "market consensus?"
• How do management’s incentives impact projections?

The webinar is available to ABI members for $75 and is approved for 1.0 CLE hours in Calif., Ga., Hawaii, Ill., N.Y. (approved jurisdiction policy) S.C. and Texas. CLE approval is pending in Del., Fla., Pa. and Tenn. To register, please click here.

LATEST CASE SUMMARY ON VOLO: STUDENSKY V. MORGAN (IN RE MORGAN; 5TH CIR.)



Summarized by Aaron Kaufman of Cox Smith Matthews Inc.

The Fifth Circuit reversed the judgment of the district court and held that where a debtor does not claim a homestead exemption and then sells the homestead post-petition, the debtor has the burden of claiming the exemption in the proceeds within the six months allowed under applicable state law. In this case, because the debtor failed to claim an exemption in his homestead and failed to claim an exemption in the proceeds during the six months following the sale (i.e., while the proceeds were exempt under state law), the debtor lost his right to claim an exemption in the sale proceeds. The trustee's objection should have been sustained. The lower courts' decisions were reversed and remanded.

More than 570 appellate opinions are summarized on Volo typically within 24 hours of the ruling. Click here regularly to view the latest case summaries on ABI’s Volo website.

NEW ON ABI’S BANKRUPTCY BLOG EXCHANGE: LIBOR SCANDAL UNDERMINES BANKERS' CLAIMS OF OVERREGULATION



The Bankruptcy Blog Exchange is a free ABI service that tracks 35 bankruptcy-related blogs. A recent post examines the issues surrounding the Libor scandal and how it is undermining the push by bankers for looser regulations.

Be sure to check the site several times each day; any time a contributing blog posts a new story, a link to the story will appear on the top. If you have a blog that deals with bankruptcy, or know of a good blog that should be part of the Bankruptcy Exchange, please contact the ABI Web team.

ABI Quick Poll

The anti-modification rule for home mortgages in chapter 13 should be repealed, subjecting mortgage debts to bifurcation like any other secured claim.

Click here to vote on this week's Quick Poll. Click here to view the results of previous Quick Polls.

IS YOUR ABI MEMBERSHIP PROFILE CURRENT?



Keeping a current profile will allow you to benefit from one of ABI's most important services - networking. When you update your profile, you are putting your most valuable information in the membership directory. Be sure to include your areas of expertise, firm information, education and join any other committees that are of interest. Click here to update your profile.

INSOL INTERNATIONAL



INSOL International is a worldwide federation of national associations for accountants and lawyers who specialize in turnaround and insolvency. There are currently 37 member associations worldwide with more than 9,000 professionals participating as members of INSOL International. As a member association of INSOL, ABI's members receive a discounted subscription rate. See ABI's enrollment page for details.

Have a Twitter, Facebook or LinkedIn Account?

Join our networks to expand yours.

July

- Southeast Bankruptcy Workshop

     July 25-28, 2012 | Amelia Island, Fla.

-Valuation Webinar, July 30 at 11 a.m. ET

August

- Mid-Atlantic Bankruptcy Workshop

     August 2-4, 2012 | Cambridge, Md.

September

- Complex Financial Restructuring Program

     September 13-14, 2012 | Las Vegas, Nev.


- Southwest Bankruptcy Conference

     September 13-15, 2012 | Las Vegas, Nev.

- 38th Annual Lawrence P. King and Charles Seligson Workshop on Bankruptcy & Business Reorganization

     September 19-20, 2012 | New York, N.Y.

October

- Nuts & Bolts for Young and New Practitioners - KC

     October 4, 2012 | Kansas City, Mo.

- Midwestern Bankruptcy Institute Program, Midwestern Consumer Forum

     October 5, 2012 | Kansas City, Mo.

- Bankruptcy 2012: Views from the Bench

     October 5, 2012 | Washington, D.C.

- Chicago Consumer Bankruptcy Conference

     October 8, 2012 | Chicago, Ill.

- International Insolvency and Restructuring Symposium

     October 18, 2012 | Rome, Italy

November

- Detroit Consumer Bankruptcy Conference

     November 12, 2012 | Detroit, Mich.