the Coming Crisis – Part Iii

Pension Plans And The Detroit Municipal Bankruptcy Please read the preceding articles of this series on pensions plans and the Detroit municipal bankruptcy to gain a better context and understanding of this article.    The plan proposed by the city of Detroit in its municipal bankruptcy in late July of 2014, was accepted by approximately 82% of the Police and Fire Retirement System and by about 73% of the General Retirement System retirees and current Detroit employees. The majority of bondholders disapproved of the bankruptcy Read More +

the Coming Crisis – Part Ii

Pension Plans And The Detroit Municipal Bankruptcy Please read Part I of this series on Pension Plans and Municipal Bankruptcy to gain a better context for this and the following blog articles on Municipal Bankruptcy, Detroit, and the coming crisis in governmental pension plans.    According to the Chicago Tribune, the City of Detroit proposed a plan to US Bankruptcy Judge Steven Rhodes, in Detroit, that would adjust the approximately 18 billion dollars in debt acquired by the city. The debt acquired by the City Read More +

the Coming Crisis – Part I

Pension Plans And Municipal Bankruptcy    Detroit is in Bankruptcy. Detroit is Bankrupt. As of the date of this article, August 19, 2014, Detroit is the debtor in a municipal bankruptcy. Not only individuals or persons, or corporations, can file Bankruptcy. Cities can also file bankruptcy, and seek its benefits and protections. A major issue in the Detroit Bankruptcy, and a major reason for its bankruptcy, is the pension benefits and medical benefits promised to the civil servants of Detroit, both present and retired. Those Read More +

the Rise of the “foreclosure Rescue” Companies

   With the many millions of homeowners having difficulty with the terms of their mortgages, there has been created a large number of groups that portend to assist such homeowners in modifying their mortgages. While there are legitimate and well meaning participants, there are also a number of unscrupulous foreclosure rescue companies that are essentially scams. Such bad actors often make unsubstantiated promises such as guarantees that one can retain their home or receive a lower mortgage payment. Weller Legal Group and Jay Weller have Read More +

the History of Debtors Prisons and Why It is Important to You (3 of 3)

Debtors Prisons In Early American History Debtor’s Prisons existed in the United States dating from the beginning of Colonization to 1850. Numerous important early political figures were incarcerated throughout the history of debtors prisons, most likely giving the Founders a perspective on the ills of the debtor prison system. William Morris, one of the signors of the Declaration of Independence, was imprisoned from 1798-1801 in a debtors’ prison in Washington, DC. One of his more regular visitors was George Washington. James Wilson, another signor of Read More +

the History of Debtors Prisons and Why It is Important to You (2 of 3)

Debtor Prisons In United States Today In the United States, although there are no Debtors Prisons specifically, a debtor can be imprisoned in numerous circumstances under criminal penalties which are usually imposed monetarily, but for which the debtor is unable to pay. For example, persons can be found in Contempt of Court and imprisoned after nonpayment of garnishments, confiscations, fines, back taxes and child support. Such penalties are framed as Contempt of Court, the rationale given is obstruction, fraud or negligent nonpayment. Many debtors are Read More +

the History of Debtors’ Prisons and Why It is Important to You (part 1 of 3)

Debtors’ prisons have existed for many centuries on this planet, and in fact, many forms of bonded servitude and slavery still exist today. Bonded servitude is practiced in India, and other nations, and slavery in its most brutal forms, is practiced in various parts of Africa. Debtors’ prisons are facilities where persons are imprisoned who are unwilling or unable to pay their debts. Bankruptcy Laws were eventually formulated and enacted in order to betray the harsh penalties imposed upon the populace, usually upon the most Read More +

Origins of Bankruptcy Law in the United States

The United States Constitution gives Congress the power to establish laws on the subject of Bankruptcy throughout the United States. Congress first exercised this power the Bankruptcy Act of 1800. This act, which virtually copied the existing English law, provided for involuntary bankruptcies and was only available to traders (merchants). The act was repealed three years later in 1803. Two more short-lived federal bankruptcy laws were enacted from 1841 to 1843 and from 1867 to 1878. A permanent federal bankruptcy law would not go into Read More +

Bankruptcy in England

Bankruptcy law in England was once quite harsh. Bankruptcy was considered a crime and people who could not pay their debts were thrown into debtors’ prison or had their ears cut off. In fact, the first legislation dealing with bankruptcy in England was the Statute of the Bankrupts in 1542. One purpose of this law was to prevent people who owed money from escaping England. Only creditors could commence a bankruptcy proceeding. This law aided in the collection of debts and did not provide relief Read More +