The KEL law firm is facing a lawsuit alleging it routinely allowed clients to pay bankruptcy legal fees using credit cards, a violation of bankruptcy law. Credit card purchases are considered new debts and new debts are prohibited in the days before filing for bankruptcy and during the bankruptcy process. That is because bankruptcy courts often erase a filer’s credit card debt, which means the nation’s banking system would be on the hook for KEL’s legal fees.
The suit, which seeks class-action status, contends that KEL “uses standardized procedures when attempting to collect attorney’s fees by charging credit cards prior filing Chapter 7 bankruptcy.” It seeks the return of all bankruptcy fees paid by credit card—the amount of which is cited at $1,700 in the suit—and $1 million in punitive damages.
The lawsuit states an Orlando resident paid his bankruptcy fees to KEL using a Discover credit card and a BJ’s credit card. During the course of the filing, the debtor decided to switch to a new law firm, which noticed the prior fee payment on the credit cards to KEL. Jacksonville law firm Mickler & Mickler filed the proposed class action on behalf of the debtor.
If you are in financial crisis and considering filing for bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade & Garcia, P.A. has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com.
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