Today’s sophisticated desktop publishing makes it easy to produce virtually undetectable fraudulent checks with which to bilk unsuspecting businesses and financial institutions, say the NCUA officials. However, the law gives financial institutions “reasonable time” to check the authenticity of a check if they have “reasonable cause” to doubt its collectibility. In one California case, checks […]

Here, a 34 year old credit union loan officer submitted a Workers’ Compensation claim against her employer credit union for post-traumatic stress disorder. The claim was denied and on appeal the credit union prevailed. The Court of Appeals of Oregon found the credit union employee had been exposed to an armed robbery at another credit union […]

Here, debtor purchased more than $1,100 of collector Barbie dolls and accessories within 40 days of filing for bankruptcy. Debtor sought to discharge these debts to the creditor who issued the credit card upon which the charges were placed. Creditor filed an adversary complaint with the Bankruptcy Court claiming that these Barbie doll purchases were “luxury […]

In this case, a member of First Railroad Community Credit Union, Clark Crapps, held accounts at Columbia County Bank [Columbia] and Florida’s 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 allowed immediate credit on deposits made to […]

Here, the debtor owed more than $3,900 to ITT Financial Services on a loan secured by various items of personal property, including a Pentax Camera and lens, snowblower, color television set, VCR, stereo system, a gun, power saw and an electric guitar. The initial debt was refinanced several times by the debtor and on each […]

In this case, the Federal Court held that a guarantor on a loan is not excused from liability even when the principal debtor files bankruptcy. In this case, an obligation to the creditor was guaranteed by a third-party. The principal debtor filed bankruptcy and proposed to “cram down” the obligation to the creditor. Creditor filed an action […]

Here, a state court judgment found the debtor liable for fraud. Although the federal court has exclusive jurisdiction as to determining dischargeability in bankruptcy, the federal court nevertheless found the debtor was precluded from refuting the state court judgment. Hence, the debtor could not collaterally attack the state court judgment in federal court, and the […]

Bank-Fund Staff Federal Credit Union held a mortgage on debtors’ real estate.  The loan was in default and the credit union sought to foreclose and obtain possession of the property. The credit union initiated foreclosure proceedings and sent a Notice of Foreclosure Sale to debtors. The foreclosure notice, however, erroneously stated that the members did […]

PERSONAL LIABILITY VERSUS CORPORATE LIABILITY. In this case, the debtors, McClellan and Hoyt, were, respectively, the president and secretary of Calistoga Court Club, Inc. Calistoga Court Club, Inc. applied for and received a loan for $30,420 from a predecessor in interest to Mountain America Credit Union. The loan went into default and the debtors’ corporation […]

Debtor issued three checks to his creditors prior to his filing a Chapter 7 bankruptcy, however, those checks had not cleared debtor’s bank at the time he filed bankruptcy. The Trustee in Bankruptcy sought an order compelling debtor to turn over the funds in his account at the time he filed for bankruptcy in the […]