• Report: #593558
Complaint Review:

USA Bankruptcy Associates

  • Submitted: Thu, April 15, 2010
  • Updated: Tue, April 27, 2010

  • Reported By: John — Hattiesburg Mississippi United States of America
USA Bankruptcy Associates
Internet United States of America

USA Bankruptcy Associates AVOID THIS COMPANY Internet

*Consumer Comment: Hmmm . . .

*Author of original report: Response to Comment

*General Comment: A review of the TOS could have averted this problem

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I am an experienced attorney who is embarrassed to have been ripped of by this fraudulent company.

I thought I could save my client some money by using this service to prepare a Chapter 7 Bankruptcy Petition for a corporation. Nothing on the website says that they cannot prepare corporate petitions. Once I signed up, I found that you could only use their service to prepare individual bankruptcy petitions.

I contacted them through their cheesy and restrictive email process and they refused to refund my money, insisting that we had a "contract." The only thing is that they did not provided what I contracted to receive.

Repeated "arguments" through the email system were pointless.

This company is a complete scam. Run, do not walk, away from them!

This report was posted on Ripoff Report on 04/15/2010 11:27 AM and is a permanent record located here: http://www.ripoffreport.com/reports/usa-bankruptcy-associates/internet/usa-bankruptcy-associates-avoid-this-company-internet-593558. The posting time indicated is Arizona local time. Arizona does not observe daylight savings so the post time may be Mountain or Pacific depending on the time of year.

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#1 Consumer Comment

Hmmm . . .

AUTHOR: Tim - (U.S.A.)

The attorney's response is a bit disingenuous. The language on the site states, in many places, that they provide services for individuals. Also, when entering information on the sign-up page, it clearly asks for the "personal information" of the "person filing bankruptcy." You have to enter a first and last name. How did you get around this?

Also, as I stated above, the TOS CLEARLY state "we do not prepare corporate services." Granted, they should change this language to read "we do not prepare corporate petitions." But this should have at least served as a red flag.

Finally, while the preparation of a bankruptcy petition is not, in and of itself, the practice of law, a corporate bankruptcy petition does require the signature of an attorney. Further, some portions of the schedules do call for legal conclusions (i.e. whether a debt is "liquidated, unliquidated, or contingent"). I've always been under the impression that this presents a bar to the use of petition preparation services by corporations.

However, I would agree that they probably should give a refund in this case as it should have become apparent, very shortly into the preparation process, that the client was a corporation and that they could not perform the work. This situation differs from the situation presented in the justification for their refund policy (the "cold feet" scenario).

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#2 Author of original report

Response to Comment

AUTHOR: John - (United States of America)

The comment to my initial post, like USA Bankruptcy Services, claims that the company cannot represent corporations in court. I was fully aware of that. The excuse offered by the company and the commentator that USABS cannot represent corporations is irrelevant. USABS cannot represent individuals either, since to do so would constitute the unauthorized practice of law. They just prepare paperwork.

This company allegedly prepares the paperwork for people to file for themselves. I was seeking to use the service to prepare paperwork that I would file as an attorney for the corporation. Neither constitutes USABS rendering legal services for corporations.

The company's website does not say that they do not prepare corporate petitions. It should say so. Regardless, since I did not get what I paid for, they have no reason not to refund my money. It is no different than ordering something only to find out that the product is sold out.

The fact that they are taking advantage of their own failure to disclose and refusing to issue a refund under these circumstances proves that they are a fraud.

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#3 General Comment

A review of the TOS could have averted this problem

AUTHOR: Tim - (U.S.A.)

The reporter, an experienced attorney:

1. Placed his client's fiscal and legal well-being in the hands of an ill-researched petition preparation service (if you're even marginally familiar with post-BAPCPA bankruptcy law, you can easily see the dubious nature of their marketing);

2. Failed to recognize that corporations are not permitted to act pro se in federal courts and therefore are not permitted to use bankruptcy petition preparation services (an attorney's signature is required);

3. Failed to review the TOS, even as the sign-up page requires you to verify that you have reviewed and agree to them.

Had he reviewed the TOS, he would have surely seen the following statement: "We do not prepare corporate services."

Granted, this statement is not worded correctly (corporate services?). But the TOS, which were agreed to, specifically state that they don't do corporate work.

The TOS also states that refunds will only be given when a client can't receive a discharge due to the fault of the company. I won't get into their justification for this policy, but I did find it convincing.

I don't know whether or not this company is a scam. In my opinion, this report didn't present any evidence of a scam. I reviewed the website and I found their marketing to be largely based in misconceptions regarding the 2005 changes to the Bankruptcy Code.

Bankruptcy petition preparation services do provide a cost-effective alternative to paying for an attorney to handle a simple and routine bankruptcy case. But everyone contemplating bankruptcy should at least consult with a qualified attorney, because not all cases are "simple and routine."

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