Legal News for Credit Union Managers Since 1990

Archive for January, 2023

16
Jan
2023

Right to Cancel – Truth-In-Lending Violation

Defective Notice of Right to Cancel results in Truth in Lending Violation and extends borrowers right to rescind. Here, New Maine National Bank granted a loan to the debtors secured by debtors’ residence. At the closing of the loan, the loan officer supplied the debtors with a “Notice of Right to Cancel” (hereinafter “Notice”). Pursuant to the […]

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13
Jan
2023

Cashier Checks: Bank Liable to Credit Union

Check-kiting scheme results in liability of Bank to Credit Union. Here, Clark Crapps was a member of First Railroad Community Credit Union and also held accounts at Columbia County Bank [Columbia] and First Community Federal Credit Union [Credit Union]. Crapps was engaged in an elaborate check-kiting scheme for which neither Columbia nor the Credit Union was aware. Columbia […]

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13
Jan
2023

Reopening Bankruptcy Case Denied

Debtors filed a Chapter 7 bankruptcy, were discharged and the case closed. Slightly more than one year after the case was closed, debtors submitted a motion to reopen the case and add two more creditors that they had failed to list in the original proceeding. The court denied the debtors’ motion and refused to reopen […]

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12
Jan
2023

Board Member Loses Suit Against Credit Union

In this case, John Heller was a member of the Board of Directors of CACL Federal Credit Union.    CUMIS Insurance Society informed CACL that the bond for Heller had been revoked.   Despite the loss of his bond and inability to find a replacement bond (as required by the NCUA), Heller ran for reelection […]

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11
Jan
2023

Cram-Down Plan Amendment Denied

Debtors attempt to cram-down secured loan to “unsecured” status after debtor’s Chapter 13 Confirmation Hearing was denied by Court. Here, debtor owed a loan to creditor secured by one Mercury automobile. Debtor’s Chapter 13 repayment plan proposed to cram-down the obligation to the fair market value of the vehicle and repay creditor only $1,125, plus […]

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10
Jan
2023

Temporary Freeze on Member Deposits

In an earlier precedent setting ruling, the bankruptcy court held that a bank’s temporary freeze on its depositor’s accounts did not violate the bankruptcy court’s automatic stay in a Chapter 7 proceeding. Here, the Bank of Newport had a standing policy that upon notice of a checking account customer filing a Chapter 7 Bankruptcy, the funds on […]

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10
Jan
2023

Credit Union Taking Possession Must Evict Occupants

Following the Credit Union’s purchase of the house, two occupants residing in the house at the time of the purchase were given notice that if they did not voluntarily move from the premises, they would be evicted.   Here, the residents did not move out, and a complaint for eviction was filed with the court.   The court […]

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09
Jan
2023

Member Disability Insurance Coverage Denied

In this case, the credit union brought an action alleging the defendant borrowed $6,000 and failed to repay the same. The credit union also produced a promissory note signed by the defendant (Shaham). Defendant purchased disability insurance at the inception of this loan and thereafter became disabled. The insurance company did not honor his claim […]

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06
Jan
2023

Member Loan Disability Insurance

In this case, Textron Lycoming Federal Credit Union brought an action alleging the defendant borrowed $6,000 and failed to repay the same. The credit union also produced a promissory Note signed by the borrower-defendant. Defendant purchased disability insurance at the inception of this loan and thereafter became disabled. The insurance company did not honor his […]

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05
Jan
2023

Creditor Ordered to Release Lien

In this case, debtors owed more than $15,000 to Hancock Bank on a loan secured by debtors’ Chevrolet Caprice. The amount owed was not in dispute. Debtors’ Chapter 13 Plan proposed to repay Hancock Bank the value of its security, which was listed at $8,175. The balance of the funds owed to Hancock of approximately $6,800 was […]

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« Previous Entries
  • Recently Posted Articles written by: Charels R. Harroun, Attorney at Law

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