Debt Relief Agencies

DEBT RELIEF AGENCIES– 11 U.S.C. § 526-528

Milavetz, Gallop & Milavetz, P.A. v. U.S., – U.S.-, 130 S.Ct. 1324 (2010)

1. Attorneys who provide bankruptcy assistance are “debt relief agencies” under §

101(12A);

2. Section 526(a)(4) does not prohibit a debt relief agency from advising an “assisted

person” to incur any new debt. Rather, it “prohibits debt relief agency only from advising a

debtor to incur more debt because the debtor is filing for bankruptcy, rather than for a valid

purpose.” 130 S.Ct. at 1336.

3. Because § 528′s requirements that a law firm identify itself as a debt relief agency and

include certain information about its bankruptcy-assistance and related services are “reasonably

related to the [Government’s] interest in preventing deception of consumers”, those requirements

are valid. 130 S.Ct. at 1340.

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