Custodial account – Sarah Long http://sarahlong.org/ Wed, 15 Dec 2021 04:09:17 +0000 en-US hourly 1 https://wordpress.org/?v=5.8 https://sarahlong.org/wp-content/uploads/2021/10/icon-44-120x120.png Custodial account – Sarah Long http://sarahlong.org/ 32 32 Cash-Advance Apps Court Users With Cute Mascots and Fast Payments — but Beware of the High Costs https://sarahlong.org/cash-advance-apps-court-users-with-cute-mascots-and-fast-payments-but-beware-of-the-high-costs/ Wed, 15 Dec 2021 03:01:46 +0000 https://sarahlong.org/?p=649 Download the Dave app on your smartphone, as millions of people already have, and you’ll be greeted by an anthropomorphic bear wearing thick-rimmed glasses and holding a pawful of cash. The friendly, upright ursid wants to help you get your finances on track. To do so, the digital financial services app will let you take […]]]>

Download the Dave app on your smartphone, as millions of people already have, and you’ll be greeted by an anthropomorphic bear wearing thick-rimmed glasses and holding a pawful of cash.

The friendly, upright ursid wants to help you get your finances on track. To do so, the digital financial services app will let you take out a cash advance of up to $250 with no interest. Asterisk. You’ll avoid overdraft fees. Asterisk. And get paid up to two days sooner. Asterisk.

Dave, founded in 2017 and backed by celebrity entrepreneur Mark Cuban, is expected to go public this quarter. It’s one of several fintech startups that offer “interest-free” cash advances, though the companies do make money through a combination of fees, tips or both, hence all the asterisks. The financial apps Earnin and Brigit work similarly, sans the animal mascots. The companies say they’re ushering in the end of predatory payday loans and overdraft fees, and they’ve been gaining popularity throughout the pandemic as cash-strapped users seek out fast funds.

However, consumer experts warn their fees are just as bad as — if not worse than — traditional payday loan APRs, with rates that can easily top 300%. And, they say, the apps can actually trigger overdraft fees. Policymakers are caught in the middle, mulling over how exactly to regulate them. They’re taking a hands-off approach — at least for now.

Dave’s cash-advance service on Virginia bankruptcy laws is just one of the app’s many financial features. The app itself is available for free. But the cash advance portion requires a membership fee of $1 per month, which the company says goes toward linking your bank account.

Once you take out a cash advance, the app prompts you to leave a tip, saying that Dave donates tip money to feed families in need. The recommended tipping amounts default to percentages — 5%, 10% or 15%. (“Tips are completely voluntary,” says Dave spokesperson Danny O’Keefe.)

Yet the techniques Dave and similar companies use to present their voluntary-tipping features are also raising red flags with consumer advocates.

“Some of these applications use some behavioral marketing to incentivize people to pay more,” says Charla Rios, a small-dollar loan researcher at the Center for Responsible Lending. “The more you tip, the happier the cartoon bear is, and that kind of thing.”

With Dave, you can set custom tipping amounts on a scale of 0% to 25% in the settings menu, except the percentages in this menu are now referred to as “healthy meals.” As you increase your tip, you’ll see a young animated girl in a bear shirt grow excited as she’s surrounded by fruit, veggies and bread. Move the tip all the way to zero, and all you’ll see is an empty plate.

O’Keefe confirmed that a portion of tips — not the whole sum — goes to Dave’s non-profit partner Feeding America. The company has provided about 31 million meals through the partnership and made more than $5 million in total charitable contributions, he says.

In Earnin’s case, there’s no monthly membership fee. If you take out a cash advance (of up to $500), the app prompts you to “pay it forward” by associating its tips with helping other Earnin users, who are represented by cutesy avatars of ninjas and astronauts. A $5 tip will help one user, the app says. A $10 tip will help two users, and so on.

It’s possible to skirt tipping altogether, but only if you know to tap “custom tip” and manually change the tipping dial to zero. According to the New York Post, not tipping previously had consequences: Earnin used to limit the amount of cash advances to New York users who did not tip. The company reportedly halted the “pay-to-play” practice in New York in 2019 under regulatory pressure.

In a statement to Money, Earnin wrote that tipping behavior and history are not used as criteria to determine cash-advance availability or amounts. The company did not elaborate on when or where the practice, as described by the Post, was in effect.

The Brigit app, on the other hand, doesn’t rely on the tip-based model. Instead, it charges users a $9.99 monthly membership fee to become eligible for a cash advance of up to $250 — as well as a host of other budgeting and credit score tracking features. The monthly fee applies regardless of whether users take out an advance or not. Brigit did not respond to Money’s request for comment.

A regulatory battle over the definition of ‘credit’

Consumer advocates say that apps like Dave and Earnin point to the voluntary nature of their tipping and fee structures to avoid being classified as credit products. That allows them to play by different rules than traditional creditors.

But regulatory guidance on newer fintech companies that offer cash advances and similar products has been somewhat mixed. As it stands, consumers currently don’t receive the same federal protections for a cash advance from a company like Earnin as they would for a cash advance or loan from a more traditional lender — from, say, a credit card company like Chase or even a payday lender like Amscot.

So how are they regulated? “That’s a good question,” says Lauren Saunders, an associate director at the National Consumer Law Center (NCLC). “They’re not, really.”

That’s because, in late 2020, the Consumer Financial Protection Bureau (CFPB) issued advisory guidance, concluding that payday advances from fintech companies generally aren’t considered credit, as defined by federal law. Therefore, the fintech lenders aren’t required to disclose the fees associated with advances in terms of APRs, or annual percentage rates.

The focus of the CFPB’s guidance was mostly on payroll advance services through companies like PayActiv. Such companies market themselves as an employee perk by partnering directly with employers, as opposed to the apps that are marketed directly to consumers.

All of these companies loosely fit under the umbrella of earned wage access, early wage advances or payday advances. (They go by many names.) Consumer advocates break them into two core categories: The employer-partnership model — the PayActivs — and the direct-to-consumer model — the Daves.

While consumer advocates do have a bone to pick with the employer-partnership model, they stress that the CFPB’s guidance for that model has a rippling effect on the far riskier direct-to-consumer apps.

The Center for Responsible Lending (CRL), the NCLC and 94 other consumer, faith and labor organizations wrote a letter to the CFPB in October, asking the agency to rescind its opinions and regulate fintech payday products as credit. Lobbyists for the fintech lending industry, the organizations wrote, are using the CFPB’s actions to argue for further exemptions from state lending laws.

While federal regulators have so far gone the laissez-faire route, state regulators are also grappling with the same questions.

The New York Department of Financial Services, in tandem with 10 other states and Puerto Rico, launched an ongoing investigation to determine if fintech lenders are skirting state lending rules. Some of the firms appear to collect “usurious” interest rates in “the guise of ‘tips’” or monthly membership fees, the DFS said in announcing the investigation in 2019.

On the other side of the country, California’s Department of Financial Protections and Innovation signed an agreement earlier this year with Earnin and four similar fintechs, exempting them from state APR disclosure requirements for now. In the meantime, the agency is collecting and analyzing quarterly reports from the companies to determine the “risk and benefits to California consumers.”

Congress is also entering the fray to determine how such companies should be regulated, if at all. The U.S. House Committee on Financial Services held a hearing in November to investigate the risks and benefits of fintech companies that offer cash advances and similar credit-like products.

“Shiny fintech garb does not remove the need for basic consumer protections,” Saunders, of the NCLC, testified at the hearing. “Earned wage access products are a form of payday loan — wage advances repaid on payday — and should be regulated as credit.”

Fees and tips — or sky-high loan APRs?

When you order lunch through Uber, a nearby food courier scrambles to grab your food and deliver it to your doorstep. After you place your order, Uber prompts you to leave a tip of 15% or 20%, which you can change depending on how good a job you think the courier did.

Apps like Dave and Earnin prompt you to tip in very similar ways. On the user side, whether it’s Uber or Earnin, it’s just a quick couple taps on your smartphone all the same. But Saunders says consumers should view the tips on cash advances very differently.

“The tip isn’t going to a human being who gave you a service,” she says. “It’s going to a big company that’s making money and is just using tips as a form of interest.”

Money lending is typically viewed in terms of APRs so consumers can compare products with different fees or interest rates in a standardized way.

But “the tips model can really add up in ways that are not apparent,” Saunders says.

Take, for instance, the 10% or 15% tips suggested by cash-advance apps. Those are simple percentages that don’t factor in time like APR does. Viewed through the lens of APR, those voluntary tips and fees could easily translate into three-digit APRs.

“Default tips on most of these apps are equivalent to interest rates that can be 200% or 300% APR or higher,” Saunders says.

For example, if you tip 15% on a $100 advance that you use to tide you over for two weeks until your next payday, that would equate to an APR of 391%. And that’s not including all of the other fees that could apply.

For instance, a cash advance through both Dave or Earnin may take several business days to hit your bank account by default. To expedite your advance, they charge you extra: Dave’s fees range from $1.99 to $5.99, depending on the advanced amount ($5.99 for an advance of $100 or more), and Earnin charges a flat “Lightning Speed” fee of $2.99, no matter the amount. (According to Earnin, the fee is voluntary, part of a “small test” and not available to all Earnin users. The company will refund it if the advance doesn’t transfer on time.)

A 14-day, $100 immediate cash advance through Dave — including its $1 membership fee and a 15% tip — would translate into an APR of over 573% if the apps were subject to the same rules as other payday lending products. According to state-by-state rules from the Consumer Federation of America, a 573% APR for a $100, 14-day loan from a traditional payday lender would violate lending laws in more than 30 states.

“That is an example of why it should be a regulated product, because it is a form of credit at this point,” says Rios of CRL.

Rios also warns of additional fees, beyond the sky-high APRs, associated with cash-advance apps. For example, despite their marketing as overdraft avoidance tools, the apps may actually trigger overdraft fees from your bank. That’s because when the time comes to pay back your advance, the lending apps may automatically deduct the funds from your bank account — regardless of whether enough funds are available.

Following a class action lawsuit settled in March, Earnin was ordered to pay $3 million to users who were charged overdraft fees. Earnin denied any wrongdoing in the settlement.

“If we trigger an overdraft due to an error on our part, Earnin will cover the fee,” the company wrote in its statement to Money.

Consumer advocates, including Rios and Saunders, stress that app-based cash advances should be used only as a last resort, and preferably not at all. They’re calling for stronger consumer protection rules to help keep everyday borrowers from racking up unexpected fees and paying three-digit APRs.

Saunders says that there is “a lot of interest” from lawmakers and regulators regarding this new breed of fintech lenders, pointing to the multi-state investigation led by New York’s financial regulators as well as the recent House committee hearing. However, neither have led to clear next steps in terms of policy change.

For now, she says, the ball is in the CFPB’s court.

More From Money:

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This article originally appeared on Money.com and may contain affiliate links for which Money receives compensation. Opinions expressed in this article are the author’s alone, not those of a third-party entity, and have not been reviewed, approved, or otherwise endorsed. Offers may be subject to change without notice. For more information, read Money’s full disclaimer.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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How businesses can adapt amid the changing legal needs of COVID https://sarahlong.org/how-businesses-can-adapt-amid-the-changing-legal-needs-of-covid/ Tue, 14 Dec 2021 21:45:00 +0000 https://sarahlong.org/how-businesses-can-adapt-amid-the-changing-legal-needs-of-covid/ By Avi Stadler (December 14, 2021, 4:45 p.m. EST) – There is no small irony in the fact that the legal profession, with a reputation for reluctance to resist change, is one of the main beneficiaries of the disruptive forces unleashed by the Pandemic by covid19. Major law firms, many of which cut salaries and […]]]>
By Avi Stadler (December 14, 2021, 4:45 p.m. EST) – There is no small irony in the fact that the legal profession, with a reputation for reluctance to resist change, is one of the main beneficiaries of the disruptive forces unleashed by the Pandemic by covid19.

Major law firms, many of which cut salaries and cut staff at the start of the pandemic, are busier than ever in 2021.

This shouldn’t be surprising. New legislation and new social and economic arrangements have historically created an increased demand for legal services.

The new laws impose additional compliance obligations. Economic stress and changes in the status quo necessarily require a recalibration of business risks, triggering an increase …

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Automatic suspension and bankruptcy of debtors https://sarahlong.org/automatic-suspension-and-bankruptcy-of-debtors/ Tue, 14 Dec 2021 20:10:37 +0000 https://sarahlong.org/automatic-suspension-and-bankruptcy-of-debtors/ If you’re facing debt issues You might think filing for bankruptcy would aid. It’s crucial to know the meaning of bankruptcy and what options are that are available. Because bankruptcy isn’t permanent it could eliminate your debts and permit you to begin over. A lot of creditors have been warned of the necessity to cease collections once […]]]>

If you’re facing debt issues You might think filing for bankruptcy would aid. It’s crucial to know the meaning of bankruptcy and what options are that are available. Because bankruptcy isn’t permanent it could eliminate your debts and permit you to begin over.

A lot of creditors have been warned of the necessity to cease collections once they’ve been informed that a debtor has made bankruptcy filings and read more information about Bankruptcy HQ VA bankruptcy laws. But the “why” of this warning, and in particular an automatic suspension is frequently not understood or even acknowledged. Because violations of automatic stays are serious It is vital that creditors are aware of what an the automatic stay is, how it safeguards, and the best way to request a waiver from the stay to ensure that the creditor is able to continue to pursue their claims. collection efforts.

What exactly is this automatic stop? What is it protecting?

The debtor is able to begin bankruptcy through filing a bankruptcy petition. This applies regardless of whether the debtor file in Chapter 7, 11, 13, or another Chapter in the United States Bankruptcy Code. In the 11 USC SS 362 et seq. the filing of a bankruptcy petition causes an automatic stop to all collection actions against the debtor and estate of the debtor’s bankruptcy. When you file the bankruptcy petition the bankruptcy estate of the debtor “estate” is created.

“Estate” or “estate” in bankruptcy covers almost all the debtor’s rights, including but not limited to inventory, equipment tangible property and cash, as well as accounts that are not paid receivables, contract balances that have not been paid and more. . In the event of doubt, a creditor in bankruptcy must presume that the security on which the creditor is claiming interests is part of estate in bankruptcy.

What is the right thing for the creditor to do when the bankruptcy filing?

After receiving an official notice the bankruptcy petition The creditor is forbidden from taking any steps to recover any debt due to the debtor prior to the time of filing. Also, up to you get advice from a bankruptcy professional:

  • Stop contact: Automatic “robo” calls, standard collection calls, e-mails, letters, etc.
  • Stop collection efforts: Litigation, foreclosure proceedings, enforcement actions, etc.
  • Stop new contract Renegotiation of contract refinancing, mortgage modification, refinancing agreements for wage garnishment and repayment plans. A creditor should not end the contract with a debtor if the debtor has filed for bankruptcy.

What is a debtor able to be able to do to recover?

Although the automatic stay protections happen instantly, they’re not undefined. If a petition is filed for a stay the creditor may seek the permission of the court to continue collecting actions against a debtor, and, in particular, against assets from the estate in bankruptcy. For instance mortgagees can apply for relief to foreclose on an asset that may be “under the water”. In the same way, a lender may seek relief to take possession of an asset that is not secured, such as an automobile. In all cases the lender must prove before the judge that there exists an “cause” that warrants the lifting of the automatic stay.

Please click here for an illustration of the process of staying and the factors that creditors must take into consideration when deciding whether or not to apply for a stay.

In determining whether or not there exists a “reason” to lift the suspension, judges take into consideration a variety of factors, such as:

  • In the event that the warranty was properly covered;
  • If the debtor takes great care to preserve the collateral
  • If the debtor hasn’t paid the tax on the guarantee
  • If the debtor is able to make an interim payment on the collateral (i.e. sufficient payment for protection);
  • If equity exists in the collateral
  • In the event that the collateral required for the debtor’s reorganization (i.e. mechanic who requires his garage mortgage to repair vehicles and manage his own business);
  • If the worth of the collateral decreases and
  • If the debtor is at the root for the “undue delay” in the bankruptcy proceeding.

If a debtor is in any of the categories above, a court could identify an “ground” that allows the court to lift an automatic stay. If the creditor’s request to lift stay is granted, the creditor is then able to pursue all attempts to collect against the guarantee that is not susceptible to automatic suspension. It is vital that the obligee only proceed against this guarantee , which is clearly stated in the compensation request and the order that grants it. If the creditor pursues recovery actions against property belonging to the estate or against the individual debtor however, the creditor could be penalized for violating the automatic stay.

In contrast, a court could refuse a creditor’s request to lift the stay automatic. If that is the case the guarantee is still an asset in the estate of bankruptcy and is subject to the safeguards provided by the stay. This means there is no foreclosure and no litigation, there is the repossession of property, etc. It’s important to know that creditors may have more than just a bite take. A creditor whose initial claim was denied can file a second claim to recover damages in the event that, after months from the date of filing bankruptcy, the debtor, as an example continues to be unable to pay, or destroys any property in the process, or keeps no insurance.

In conclusion, creditors should be aware of the advice given to them in relation to dealing with debtors who are bankrupt. In fact, it’s more beneficial to petition the bankruptcy court to grant the lifting of the stay , rather than a remission of the infractions to the stay.

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Duties of Directors: A Hard Reality Following the Recent ‘Marka Decision’ and Subsequent Amendments to UAE Bankruptcy Law | White & Case LLP https://sarahlong.org/duties-of-directors-a-hard-reality-following-the-recent-marka-decision-and-subsequent-amendments-to-uae-bankruptcy-law-white-case-llp/ Tue, 14 Dec 2021 18:46:16 +0000 https://sarahlong.org/duties-of-directors-a-hard-reality-following-the-recent-marka-decision-and-subsequent-amendments-to-uae-bankruptcy-law-white-case-llp/ On November 1, 2021, Federal Legislative Decree No. 35 of 2021 (the “Decree”) (amending certain provisions of Federal Legislative Decree No. 9 of 2016 relating to bankruptcy (the “United Arab Emirates Bankruptcy Law” )) entered into force. The issuance of the decree follows an important decision on the duties of directors by the Dubai Magistrate’s […]]]>

On November 1, 2021, Federal Legislative Decree No. 35 of 2021 (the “Decree”) (amending certain provisions of Federal Legislative Decree No. 9 of 2016 relating to bankruptcy (the “United Arab Emirates Bankruptcy Law” )) entered into force. The issuance of the decree follows an important decision on the duties of directors by the Dubai Magistrate’s Court in the case involving the bankruptcy of Marka Holdings PJSC (“Marka”) (the “Marka Case”).

Overview

In the Marka case1, the Dubai Magistrate’s Court found the officers and directors of Marka personally liable for the debts of Marka in an amount equal to approximately AED450 million (which was close to the total amount of all debts payable by Marka) .

Prior to the issuance of the decree, the Bankruptcy Law of the United Arab Emirates and Federal Law No. (2) of 2015 Regarding Commercial Companies (as amended) (“CCL”) contained provisions relating to the potential personal liability of members of the board of directors of directors and officers of a company. In particular, such people could previously, under certain conditions, be held personally liable under UAE bankruptcy law for the payment of a company’s debts if a UAE court found them liable for that company’s losses.2

The Marka case may therefore appear to comply with the provisions of UAE bankruptcy law before the issuance of the decree. Despite this, since the court’s findings were released, the Marka case has been seen as an important development in the UAE’s approach to personal liability in corporate Virginia bankruptcy laws proceedings. Indeed, (1) such an approach to personal liability does not appear to have previously been applied in practice by courts in the United Arab Emirates; and (2) the extent to which this personal liability has been applied. While the particular fact pattern may be specific to the case and may be distinguished in the future, nonetheless, there was a discernible market reaction to the outcome.

The decree entered into force shortly after the Marka case. The changes made by the decree apply to Articles 144 and 201 of the Bankruptcy Law of the United Arab Emirates, in particular with regard to the liability of directors and officers in the event of bankruptcy. It should be noted that the decree itself does not provide for any significant stand-alone amendments to the UAE bankruptcy law, except for the clarification of the previous provisions relating to the personal liability of directors and officers. The changes include, among other things, (1) the clarification that each director or manager will be held liable to the extent of their responsibility for such debts; (2) granting directors or managers detained in violation of the law the right to appeal the relevant decision; and (3) further introducing a financial penalty for breach of the relevant articles in an amount not exceeding 100,000 AED) (this is in addition to the criminal liability previously included in the law).

The timing of the promulgation of the decree to be read in conjunction with the Marka decision can be seen as a key reminder to the market by the UAE government of the existence of personal accountability to senior officials of a business. In addition, taken together, the decree and the Marka case reinforce the government’s objective of demonstrating and upholding ‘best practice’ standards for corporate governance and accountability in the United Arab Emirates, in order to continue to attract foreign investment to the country.

Implications and Considerations

The decision in the Marka case can potentially be overturned following its appeal. Notwithstanding this, directors and officers (who under UAE bankruptcy law include anyone who takes an active role in a company’s decision-making) are now susceptible (if they don’t not already) to more actively seek separate independent advice to ensure that decisions made on material transactions will not affect their personal liability as a result of bankruptcy or similar insolvency proceedings.

The decision in the Marka case is fairly recent and it remains to be seen whether the ruling will establish a new approach to personal liability in UAE corporate bankruptcy proceedings. The UAE legal system does not operate on the basis of a binding precedent. As such, the court ruling in this case does not mean that it would apply in all other cases. Nonetheless, directors and managers in the UAE are likely to remain aware of their obligations under relevant laws and ensure compliance.

1 Case # 14/2019 Bankruptcy proceedings
2 Articles 144 and 201 of the UAE Bankruptcy Law and Article 162 of the CCL

[View source.]

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$ 800 Million Interim Settlement In Boy Scouts Bankruptcy For Victims Compensation Fund https://sarahlong.org/800-million-interim-settlement-in-boy-scouts-bankruptcy-for-victims-compensation-fund/ Tue, 14 Dec 2021 18:19:13 +0000 https://sarahlong.org/800-million-interim-settlement-in-boy-scouts-bankruptcy-for-victims-compensation-fund/ DOVER, Del. – Lawyers in the Boy Scouts of America bankruptcy case reached a tentative settlement whereby one of the organization’s largest insurers would contribute $ 800 million to a fund for victims of sexual abuse on children. The deal announced Monday that Century Indemnity Co. and affiliates are expected to contribute $ 800 million […]]]>

DOVER, Del. – Lawyers in the Boy Scouts of America bankruptcy case reached a tentative settlement whereby one of the organization’s largest insurers would contribute $ 800 million to a fund for victims of sexual abuse on children.

The deal announced Monday that Century Indemnity Co. and affiliates are expected to contribute $ 800 million to the fund in exchange for being released from liability for abuse claims. The payment would bring the amount of money in the proposed trust to over $ 2.6 billion, which would be the largest sexual abuse settlement in U.S. history.

The settlement comes as more than 82,000 sexual abuse claimants face a Dec. 28 deadline to vote on a previously announced Boy Scout reorganization plan.

The plan called for the Boy Scouts and its some 250 local councils to contribute up to $ 820 million in cash and property to a fund for victims. They would also cede certain insurance rights to the fund. In return, local councils and the national organization would be released from any additional responsibility for sexual abuse complaints.

The plan also includes settlement agreements involving another of the Boy Scouts’ main insurers, The Hartford, and the former BSA’s largest troop sponsor, The Church of Jesus Christ of Latter-day Saints, commonly known as the Mormon Church. The Hartford agreed to contribute $ 787 million to the victims’ fund and the Mormons agreed to contribute $ 250 million. In return, the two entities would be released from any further responsibility for allegations of child sexual abuse.

The Century settlement, which is subject to court approval, provides for additional contributions from the BSA and its local councils on behalf of approved sponsoring organizations. They include a commitment of $ 40 million from local councils and potential additional payments of up to $ 100 million from BSA and local councils due to growth in membership due to the continued sponsorship of chartered organizations. scout units.

“This is an extremely important step forward in BSA’s efforts to fairly compensate survivors, and we hope it will lead to further settlement agreements with other parties,” the Boy Scouts said. in a prepared press release. “In addition to our ongoing negotiations with other insurers, BSA has worked diligently to create a structure that will enable churches affiliated with the Roman Catholic Church and churches affiliated with The United Methodist Church that have sponsored Scout units to contribute to the proposed settlement trust to compensate survivors. “

The Boy Scouts, based in Irving, Texas, filed for bankruptcy protection in February 2020, seeking to end hundreds of individual lawsuits and create a fund for men who say they have been sexually abused in their childhood. Although the organization faced 275 lawsuits at the time, it now faces more than 82,000 sexual abuse claims in Virginia bankruptcy laws.

Lawyers for an ad hoc group called the Coalition of Abused Scouts for Justice, which represents around 18,000 abuse claimants, said in a press release that the Century settlement is another reason for victims to vote for the plan. reorganization of the BSA.

“Not only is the coalition creating the largest possible compensation fund for survivors – it’s the only fund on the table, and it is gone with a ‘no’ vote,” said the lawyer and co-founder of the Anne Andrews coalition. “The coalition also continues to work with the Boy Scouts of America on accountability and safety measures to ensure that no child suffers the horrendous damage and abuse our customers have suffered.”

The coalition, which is affiliated with more than two dozen law firms, played a dominant role in the bankruptcy despite the existence of a formal committee tasked with representing the best interests of all abuse claimants. He has also been at the center of various disputes over information sharing and how the BSA reorganization plan and trust distribution procedures were developed.

Opponents of the plan include several other law firms, as well as the official committee of abuse claimants appointed by the US bankruptcy trustee. The committee said the plan is “grossly unfair” and represents only a fraction of the potential liabilities of settlers and what they should and can pay.

The committee, for example, said settlements with local Boy Scout councils would leave them over $ 1 billion in cash and goods above what they need to complete the Scouting mission. The committee also noted that sponsoring organizations such as churches and civic groups can avoid liability for abuse claims dating back to 1976 simply by transferring their interests in insurance policies purchased by the BSA and local councils to the fund. victims, without paying money or property.

The News of the Century settlement came on the same day that an Indiana bankruptcy judge approved a $ 380 million settlement involving USA Gymnastics and more than 500 victims of sexual abuse by the former doctor of the national team Larry Nassar. The deal, which also involves the US Olympic and Paralympic Committee, is in addition to the $ 500 million Michigan State University agreed to pay in 2018 to settle lawsuits brought by more than 300 Nassar victims, former associate professor and sports doctor at the school.

Nassar’s $ 880 million combined settlements averages over $ 1 million per victim, while the proposed $ 2.6 billion Boy Scouts bankruptcy settlement averages about $ 31,600 per victim .

___

This story was first published on December 13, 2021. It was updated on December 14, 2021 to correct the fact that a settlement with the victims of sports doctor Larry Nassar involved Michigan State University, not the ‘University of Michigan.

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4 tips to avoid bankruptcy when running a startup https://sarahlong.org/4-tips-to-avoid-bankruptcy-when-running-a-startup/ Tue, 14 Dec 2021 17:52:34 +0000 https://sarahlong.org/4-tips-to-avoid-bankruptcy-when-running-a-startup/ You shouldn’t neglect the financial health of your startup during the critical early stages. The ultimate success of your start-up business depends on how well you operate and manage your finances. Educate yourself on all aspects of corporate finance and make financial projections to anticipate estimated corrections and profitable periods. Banks, alternative lenders, and peer-to-peer […]]]>

You shouldn’t neglect the financial health of your startup during the critical early stages. The ultimate success of your start-up business depends on how well you operate and manage your finances.

  • Educate yourself on all aspects of corporate finance and make financial projections to anticipate estimated corrections and profitable periods.
  • Banks, alternative lenders, and peer-to-peer lenders are resources to turn to if you need cash to grow your business.
  • The main objective of this article is to educate start-up entrepreneurs who are starting a new business and who want to know how to manage the financial health of their startup.

When starting a startup, financing may be the last thing you want to think about, but putting financial planning aside is a bad habit for new entrepreneurs. The pressure to be successful and profitable can strain any new business. Regardless of your level of corporate finance knowledge, there are a few key questions and resources that you should keep in mind.
Here are seven steps you can take to begin the financial preparation process.

  1. Open a commercial bank account
    A business bank account is one of the most important parts of organizing your startup finances. Whether opening a checking account, cash management account, or savings account, opening a commercial bank account makes sense for the following reasons:Prepare for tax season. The separation of professional and personal expenses makes easier tax returns. If you skip this step, tax season is approaching and it can be difficult to separate business and personal expenses. This can lead to lost cuts or create a supply nightmare in the future.

    Provides legal protection. A commercial bank account can protect you from personal liability to a limited extent, depending on the legal form of your business. For example, if your business is sued, a business bank account can help prove that your business is a separate entity from you, which can protect your personal assets.

    Makes you look more professional. With a business bank account, customers can pay for your business instead of making payments to you in person. This ensures that your project looks more professional.

    Take away food: A business bank account is essential because it separates personal and business finances.

  2. Learn About Financial Literacy
    It takes time to put in place the right learning tools and resources to understand and manage your business finances, but it will save you a lot of stress and money. If you don’t understand something, don’t be afraid to admit it.“A very small percentage of new business owners are successful on Virginia bankruptcy laws where all financial issues, and even fewer of them understand all the numbers on the page,” said Barry Multz, financial advisor, author and spokesperson for Small Business Administration. In addition, by educating yourself and using the right protection against financial fraud you make sure that you and your businesses are protected from day to day financial threats.

    Main dishes to take away: You don’t have to be a full-fledged corporate finance expert, but you do need to know what it all means and how to track and manage it.

  3. Manage your cash flow
    Cash flow is the money that comes in and goes out of your business. When you earn more money than you spend, you have positive cash flow. Since 61% of small businesses around the world have cash flow issues, you need to be extra careful with your business. Here are some ways to avoid negative cash flow:Send invoices as quickly as possible.
    Take care of your debts and your savings.
    Borrow before you need it.
    Evaluate your business to see where you can save.
    Adjust your balance to save money.

    Main dishes to take away: Manage your business’s cash flow by quickly creating and submitting invoices, reducing costs and debt where possible, and adjusting inventory as needed.

  4. Research your financial needs
    While some business owners start their own projects, others use outside funds to grow their business. There are a lot of things to keep in mind while going this route, including how much money you need, your loan repayment terms, your creditworthiness, and when you will need the money. Not all types of financing are right for your business. So figure out exactly what your business needs to make informed decisions.Here are some financing options for entrepreneurs and small business owners:

    Conventional loans from banks
    Commercial lines of credit
    Advance payments
    Peer-to-peer borrowing

    Main dishes to take away: Small businesses have many financing options, including bank loans, grants, and alternative lenders.

Your time and money are precious, so you want to make sure they are used efficiently. It takes more than luck to be successful in the financial and entrepreneurial world. Being in a rush will only hurt your business in the long run. Instead, redirect your thinking to the finer things in life, like money and energy.

Follow the latest news live on CEOWORLD magazine and get updates from the US and around the world. The opinions expressed are those of the author and are not necessarily those of CEOWORLD magazine. Follow CEOWORLD magazine on Twitter and
Facebook. For media inquiries, please contact: info@ceoworld.biz

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Church bankruptcy legal fees climb to $ 6 million | Guam News https://sarahlong.org/church-bankruptcy-legal-fees-climb-to-6-million-guam-news/ Tue, 14 Dec 2021 14:00:00 +0000 https://sarahlong.org/church-bankruptcy-legal-fees-climb-to-6-million-guam-news/ While the clergy sexual abuse claimants await compensation, the Archdiocese of Agana has been billed and paid around $ 6 million in professional fees, mostly from law firms hired by the church and its creditors in the case of the Virginia bankruptcy laws of the archdiocese. The amount includes invoices that Chief Justice Frances Tydingco-Gatewood […]]]>

While the clergy sexual abuse claimants await compensation, the Archdiocese of Agana has been billed and paid around $ 6 million in professional fees, mostly from law firms hired by the church and its creditors in the case of the Virginia bankruptcy laws of the archdiocese.

The amount includes invoices that Chief Justice Frances Tydingco-Gatewood of the District Court of Guam previously approved for law firms, accounting firms and real estate professionals since 2019, based on a review documents filed in Virginia bankruptcy laws court.

The church and the creditors’ committee have hired dozens of lawyers who each charge $ 250 to $ 750 an hour. The $ 750 is a reduced rate offered for the Guam case – the original rate was $ 1,025 per hour, according to Virginia bankruptcy laws court documents.

This week alone, five law firms filed their seventh claim for interim compensation, while a sixth law firm filed its first billing claim with rates of up to $ 395 per hour.

For expenses and services rendered from August 1 to November 30, 2021, the six law firms are seeking court approval of their latest billings totaling over $ 637,000.

  • $ 265,551: Stinson LLP, the Minnesota-based attorney for the Official Committee on Unsecured Creditors, including clergy sexual abuse claimants and other creditors. The court previously awarded the law firm more than $ 2.3 million, but a portion has yet to be paid by the archdiocese.
  • $ 172,375: Elsaesser Anderson Chtd., Lawyer for the Archdiocese based in Idaho. The court had previously awarded him nearly $ 1.2 million, but a portion has yet to be paid.
  • $ 136,529.39: Patterson Buchanan Fobes & Leitch, Special Adviser to the Archdiocese. The court had previously awarded him $ 575,309.
  • $ 34,675: Guam lawyer John Terlaje, Archdiocesan lawyer. The court had previously awarded him $ 226,352.
  • $ 23,475: Blank Rome LLP, Archdiocesan Special Insurance Advisor. The court had previously awarded him $ 211,640.
  • $ 4,520: Hiller Law LLC, special advisor to the Creditors Committee, in particular in the Delaware Boy Scouts of America bankruptcy case. This is the first time that the law firm has filed a request for fees.

The bankruptcy court has also previously ordered payments to other professional services firms involved in the bankruptcy proceedings, including Davis & Davis PC, the Archdiocese’s Special Immigration Council; and Deloitte & Touche LLP, the archdiocese’s accounting firm.

Among those who also previously received payments from the Archdiocese for work related to bankruptcy cases were the law firms of Paul Richler, special insurance adviser to the creditors committee; Cornerstone Valuation Guam Inc., real estate appraiser and consultant for the Creditors Committee; Keen-Summit Capital Partners LLC, Additional Real Estate Agent for the Creditors Committee; and Re / Max Diamond Realty, real estate agent for the Archdiocese.

The archdiocese pays the fees of lawyers representing both the church and the creditors committee. This is in addition to the amounts contained in the competing reorganization plans of the two parties for the Archdiocese.

In addition to growing legal fees for the Archdiocese, the church faces a challenge with its revised compensation plan for some 270 people who claim to have been raped, sexually abused or assaulted by priests and other clergy in Guam dating from the 1950s.

The archdiocese has offered to pay up to $ 34.38 million to survivors of clergy sexual abuse, while the creditors committee seeks a minimum of $ 100 million and real estate.

Guam’s clergy sex abuse scandal exploded in 2016, when former altar boys from Hågat publicly accused then Archbishop Anthony Apuron of raping or assaulting them in the 1970s.

The Vatican investigated and later convicted Apuron for assaulting several minors and stripped him of his title. Dozens of other Guam clergy have been accused of child sexual abuse.

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USA Gymnastics’ $ 380 Million Bankruptcy Plan Gets Approval (1) https://sarahlong.org/usa-gymnastics-380-million-bankruptcy-plan-gets-approval-1/ Mon, 13 Dec 2021 21:33:45 +0000 https://sarahlong.org/usa-gymnastics-380-million-bankruptcy-plan-gets-approval-1/ USA Gymnastics’ Chapter 11 plan to settle hundreds of sexual abuse claims by paying victims $ 380 million, largely from insurance proceeds, has received Virginia bankruptcy laws court approval. the plan, backed by the 476 abuse survivors who returned a vote, allows the sport’s governing body to close bankruptcy filed over revelations that team doctor […]]]>

USA Gymnastics’ Chapter 11 plan to settle hundreds of sexual abuse claims by paying victims $ 380 million, largely from insurance proceeds, has received Virginia bankruptcy laws court approval.

the plan, backed by the 476 abuse survivors who returned a vote, allows the sport’s governing body to close bankruptcy filed over revelations that team doctor Larry Nassar sexually assaulted hundreds of gymnasts women for several years. Some of the organization’s biggest stars, like Simone Biles and Aly Raisman, have joined with other gymnasts in seeking redress for the abuse they suffered.

All USAG insurers, including National Casualty Co. and Virginia Surety Co., have agreed to contribute to a bankruptcy plan trust for victims with legal claims against the organization. TIG Insurance Co. has become the latest insurer to settle with the USAG and abuse survivors, agreeing to a deal ahead of Monday’s hearing in the U.S. Southern District of Indiana Bankruptcy Court.

The US Olympic and Paralympic Committee is paying $ 34 million directly as part of the settlement.

The plan “is certainly in the best interests of creditors,” Justice Robyn L. Moberly said at the hearing before approving the plan.

“This historic settlement ends another chapter in the Larry Nassar scandal,” victim attorney John Manly of Manly, Stewart & Finaldi said in a statement on Monday. “We won for a simple reason, the courage and tenacity of the survivors. These brave women have relived their abuse publicly, in countless media interviews, so that no more child is forced to suffer physical, emotional or sexual abuse in pursuit of their dreams.

“USA Gymnastics is deeply sorry for the trauma and pain that the survivors endured as a result of the actions and inaction of this organization,” USAG President and CEO Li Li Leung said in a statement. communicated. “The reorganization plan that we jointly tabled reflects our own responsibility to the past and our commitment to the future.”

USA Gymnastics filed for bankruptcy in December 2018 over the consequences of Nassar’s abuse. The former team doctor is serving prison terms for sexual assault and possession of child pornography.

The organization at the start of the year reached a viable framework for dealing with abuse that relies on payments from insurers. The Chapter 11 plan, approved for a creditors vote in October, calls for distributing funds to abused gymnasts and maintaining programs to report abuse and support athletes. The USAG originally predicted the settlement fund would total around $ 425 million, but that figure was reduced following further negotiations with insurers.

“For years we have demanded changes from these organizations that we have been lacking, and the institutional reforms that form part of this regulation will help to ensure that this abuse does not happen again in the future for young athletes,” he said. Former Olympic gymnast Tasha Schwikert Moser said in a statement. declaration.

The case is In re USA Gymnastics, banker. SD Ind., N ° 18-09108, hearing of 12/13/21.

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CWT exits Chapter 11 bankruptcy a day after filing https://sarahlong.org/cwt-exits-chapter-11-bankruptcy-a-day-after-filing/ Fri, 12 Nov 2021 08:00:00 +0000 https://sarahlong.org/cwt-exits-chapter-11-bankruptcy-a-day-after-filing/ A U.S. bankruptcy court judge on Friday approved travel management firm CWT’s plan to come out of Chapter 11 bankruptcy, a day after TMC filed a petition, the company said on Friday. The court approval appears to put CWT on track to complete the financial recapitalization process it announced in September, including the prepackaged Chapter […]]]>


A U.S. bankruptcy court judge on Friday approved travel management firm CWT’s plan to come out of Chapter 11 bankruptcy, a day after TMC filed a petition, the company said on Friday. The court approval appears to put CWT on track to complete the financial recapitalization process it announced in September, including the prepackaged Chapter 11 filing.

In a statement released Friday night, CWT said its plan had “the overwhelming support of CWT’s financial stakeholders” and would wipe out about half of its debt.

“We are delighted to have received early court approval of the agreement we have reached with CWT’s financial stakeholders, which positions the company for long-term success and provides significant financial resources to continue the business. growth and development of our business, ”said Michelle McKinney Frymire, CEO of CWT. Friday’s statement.

RELATED: CWT’s McKinney Frymire embarks on recapitalization and takeover

CWT had prepared the Chapter 11 bankruptcy petition to expedite the closing of the restructuring and recapitalization deal, and filed it in a U.S. bankruptcy court in Texas on Thursday. A pre-defined process is a process in which debtors and creditors agree to restructuring terms before Chapter 11 filing. The company said in September that the recapitalization deal plan would replace existing debt of $ 1.5 billion. of CWT with new senior debt of $ 625 million and a new unused revolving credit facility.

RELATED: CWT’s deposits light its way to and out of Chapter 11 [$ subscription]

CWT announced Friday that the plan would raise $ 350 million in new equity in its business and announced $ 100 million in product development, including improving its myCWT travel management platform.

“Having reached this milestone, we are now in a position to move beyond the pandemic and accelerate investments that create innovative programs and cutting-edge experiences, including an enhanced myCWT platform,” said McKinney Frymire in the press release. “As business travel continues to recover, we look forward to building on our momentum, continuing to advance our strategic priorities for the benefit of our customers, partners and other stakeholders, and delivering exceptional experiences to our customers, travelers and participants. ”

The TMC said the investment would also be geared towards “increasing CWT’s existing omnichannel experience, allowing it to continue its track record of strong growth before the pandemic and enhancing the existing sustainable solutions it offers to its customers and their travelers, “a process that” will include expanding the breadth and depth of CWT’s omnichannel content, travel comparison capabilities, analytical reporting, and the choice and availability of travel solutions. sustainable to further improve the point-of-sale experience for travelers and carbon footprint details to enable better information decision-making. ”

Further details will be forthcoming, according to CWT.

RELATED: CWT prepares prepackaged Chapter 11 filing



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Women’s fashion store exits bankruptcy to reopen in Outlets at Wind Creek Bethlehem https://sarahlong.org/womens-fashion-store-exits-bankruptcy-to-reopen-in-outlets-at-wind-creek-bethlehem/ Tue, 09 Nov 2021 08:00:00 +0000 https://sarahlong.org/womens-fashion-store-exits-bankruptcy-to-reopen-in-outlets-at-wind-creek-bethlehem/ A women’s fashion and accessories store, which initially filed for bankruptcy and closed all of its stores in 2019, has plans for a return to the Outlets at Wind Creek Bethlehem. The Wind Creek location was one of 261 Charming charlie stores in 38 states that would have closed two years ago. It plans to […]]]>


A women’s fashion and accessories store, which initially filed for bankruptcy and closed all of its stores in 2019, has plans for a return to the Outlets at Wind Creek Bethlehem.

The Wind Creek location was one of 261 Charming charlie stores in 38 states that would have closed two years ago. It plans to reopen in its original space opposite the general store on the lower level. Wind Creek spokeswoman Julia Corwin said on Wednesday that there was no specific opening date scheduled yet.

Founded in 2004 by an entrepreneur Charles Chanaratsopon, the chain says its newly reopened stores will include Charming Charlie’s usual color grouping model and an extensive catalog, according to a Press release. The store is known for its clothing, handbags, costume jewelry, gifts, beauty supplies, shoes, scarves, tech gadgets, travel products, pets and children, as well as RSVP and special occasion pieces.

The company announced a national expansion last March. The move comes after Charming Charlie filed two Chapter 11 bankruptcy protection cases in 2018 and 2019, respectively, which qualifies as what professionals in the restructuring industry are calling a “Chapter 22” bankruptcy. according to USA Today.

The company then said in its court case it was facing “unsustainable operating expenses, including onerous leases” at a time when so many physical stores faced immense competition online.

Soon also available at the factory center will be Angry Jack Ax Throwing Club. Moves into space vacated by fashion retailer Van Heusen | IZOD Golf.

The site, owned by husband-and-wife team AJ and Nikki Mitchell from Downingtown, County Chester, initially announced in July plans to open the outlet center. It is not known if there were any delays in the plans; Corwin returned the comment to the Mitchell’s, who could not be reached immediately for further information. According to the company’s website, Angry Jack’s concept is to have customers experience lots of friendly competitions in a causal atmosphere.

Wind Creek will be the fourth site for Angry Jack’s, which already has three other sites in Chester County, Pennsylvania, and Elkton, Maryland.

Angry Jack’s Ax Throwing Club Plans To Move Into Space Left Vacant By Longtime Fashion Retailer Van Heusen Soon | IZOD Golf. The site is owned by husband and wife team AJ and Nikki Mitchell from Downingtown, Co. Chester.

Charming Charlie and Angry Jack Ax Throwing Club will join Bonworth, another women’s fashion and accessories boutique that opened last August. It moved to the lower-level space vacated by GH Bass & Co. The retailer has been around for about four decades with retail stores in 14 states, according to the Company Website.

There are at least eight vacant positions at the brand center. This is where shoppers will find empty spaces: one between Hartstrings and Famous Footwear; two next to the space that will house Charming Charlie; one between the general store and Corningware Corelle & More; two between Talbots and Kay Jewelers; and two next to Coach.

The factory hub, 77 Wind Creek Boulevard, offers its two levels of premium brands at affordable prices. The site is popular with shoppers, connecting the casino and the hotel.

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Pamela Sroka-Holzmann can be reached at pholzmann@lehighvalleylive.com.



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