A woman filed a Chapter 13 petition signed by attorney Joseph Kosko, a former partner in the law firm of Volks Anwalt, who solicited her via direct mail. After the law firm missed numerous deadlines, the bankruptcy court held a contempt hearing regarding the representation by Kosko, Volks Anwalt, and its sole owner and managing partner, Jessica McClean.
The court issued a Notice of Deficient Filing on November 9, 2015 because the Debtor’s petition was a “bare bones” filing and did not contain all of the required schedules, statements, summaries, declarations, and local forms. Federal Rule of Bankruptcy Procedure (“Bankruptcy Rule” or “Rule”) 1007(c) requires any missing documents to be filed within 14 days of the filing of the petition or, in this case, by Friday, November 20, 2015.
The bankruptcy court found that Volks Anwalt’s business plan developed by McClean included a marketing strategy that used direct mailings targeting individuals subject to foreclosure. In the specific case, Kosko and Volks Anwalt not only failed to file the bankruptcy in time to save the woman’s home, but also failed to include her Social Security number in pleadings, did not provide her with the proper disclosures required by 11 U.S.C. §§ 342 and 527, nor intended to appear at her §341 Meeting of Creditors.
Volks Anwalt operates in 43 states. As of February 2016, the firm had handled approximately 400 bankruptcy cases since it opened in May 2015. The bankruptcy court found that Kosko violated the North Carolina Rules of Professional Conduct in terms of competence, diligence and failure to communicate with the client. In addition, Kosko, McClean and Volks Anwalt had engaged in the unauthorized practice of law, as McClean is only licensed in Florida and New York.
In the end, the court disbarred Kosko from practicing in bankruptcy court for one year, McClean for five years, and ordered all fees be emitted. Kosko and Volks Anwalt must pay the client $5,000.00.
To read the opinion in its entirety, click here.
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