Here’s a nightmare for any creditor with a bankrupt debtor: Your borrower filed bankruptcy; they have no assets, you went to the trouble of filing a claim on a debt you’re never going to get paid on; and, now, you get sued for not properly redacting your proof of claim.
A hot-button issue in Bankruptcy court is adversary proceedings (i.e. bankruptcy lawsuits) against creditors for failure to redact personal information when they file Proofs of Claim.
When you file a Proof of Claim in Bankruptcy Court, you are obliged to comply with Federal Rule of Bankruptcy Procedure 9037.
To clarify, “redaction” means that you must cross out or otherwise remove personal identifying information. If you file a proof of claim containing personal information, there are ways to “fix” the filing. A creditor can file a motion to redact. The offending information can be blocked.
If you would like more information about creditor’s rights, or need assistance from an attorney, contact Windtberg & Zdancewicz to schedule an initial consultation.
The attorneys at Windtberg & Zdancewicz, PLC, provide Arizona residents and businesses with experienced legal representation in all collection matters. We are experienced in creditor’s rights including garnishments, charging orders, attachment, property execution, trustee’s sales, foreclosures, judgments, judgment collection, domestication of foreign judgments, and creditor’s issues in bankruptcy cases. If you need assistance with your collection matters, please contact us at (480) 584-5660.