This morning, while I was waiting for my case to be called, the US Bankruptcy Court in Boston issued a preliminary injunction against Bryon Martinez d/b/a Homestead Financial Corporation of Lynn, Massachusetts. The case is an Adversary Proceeding – a lawsuit filed in the bankruptcy court (Morse v. Martinez, Docket no. 05-1471) . The injunction prohibits him and his company from “preparing any bankruptcy documents for any person in any United States Bankruptcy Court in the District of Massachusetts …and from soliciting payment or receiving payment for providing any bankruptcy services or preparing any bankruptcy documents for any person in any [Massachusetts Bankruptcy Court]." The preliminary injunction is in effect until a full trial takes place.
According to the Complaint filed by the US Trustee, Martinez is a bankruptcy petition preparer (although not an attorney) who found his “clients” by combing through public records searching for folks who were facing foreclosure. He filed bankruptcy petitions on behalf of bankruptcy debtors, but did not disclose his status as a bankruptcy petition preparer (which is required by the US Bankruptcy Code). He would then tell his clients he would attempt to obtain refinancing of their homes, once the bankruptcy petition was filed.
According to sworn statements, Martinez provided legal advice to bankruptcy debtors, and in some cases, completely wrong and unlawful advice – such as altering income, expense, asset and debt disclosures. The complaint alleges that he would also refer some of his customers to attorneys, but he accompanied the people to meetings, and provided the attorneys with completed questionnaires, which are routinely used by bankruptcy attorneys as one of many ways of collecting and verifying information that is included in bankruptcy filings.
The Complaint alleges that Martinez is engaged in the unlawful practice of law and not complying with the US Bankruptcy Code. The US Trustee seeks a permanent injunction prohibiting him from preparing bankruptcy petitions for people in Massachusetts, disgorgement of all fees for engaging in the unlawful practice of law and additional damages for unfair and deceptive acts and practices. So far, Martinez has not defended himself against the allegations. A request for default is pending.
Unfortunately, for every guy like Martinez out there, there likely will be another to fill his shoes. While people facing foreclosure should always explore all available options, one of those options must include meeting and talking with a competent bankruptcy attorney who can listen to all facts and give honest and complete advice that can be relied on. According to the US Trustee, that is not Mr. Martinez and Homestead Financial Corporation.
If you do not live in Massachusetts, you can locate a bankruptcy attorney by going to the website of the National Association of Consumer Bankruptcy Attorneys.
