Unauthorized practice of law is an offense that is sometimes committed in bankruptcy. When it happens it is rarely intentional on the part of the debtors. In fact I personally never seen a person or organization prosecuted for this at any level. That is significant because I started my career as a city prosecuting attorney, and later defended all manner of criminals. However, it does happen.
Sometimes a judge will threaten action for unauthorized practice of law. This normally occurs in state court when a defendant is being counseled by someone not an attorney in the halls of the courthouse. Then there is the “jail house lawyer”. The jail house lawyer is jaded and may have been burned more than once by the system. This is an inmate who has been in the system forever who is usually in the holding cell of the court and is telling younger, impressionable offenders not to cooperate with their attorney even if the counsel is in their best interest.
Bankruptcy Petition Preparer
So far, none of this has anything to do with unauthorized practice of law in the bankruptcy setting. You have every right to represent yourself in bankruptcy court. In other articles I address the error of taking this path. Representing yourself does not constitute the crime. The problem comes in where you hire a bankruptcy petition preparer to complete your papers.
A bankruptcy petition preparer is a glorified typist. He or she can only put in your papers what you tell them to include. They cannot make recommendations as to what you need to include to do it right. You cannot pay them for advice. The cost can only be for basic typing. Here lies the potential problem. There are parts of the bankruptcy petition which require serious bankruptcy law knowledge and legal analysis. Two examples of these parts are Schedule C and the Means Test.
This is where you apply the exemption laws of the the state you live in to protect your personal assets. Depending on where you lived the past 730 days there might be other state or federal exemptions involved. This schedule confounds inexperienced bankruptcy lawyers. I hate to see what an unrepresented debtor would do with it.
This one is a real adventure. Forget ever doing this one right on your own. I would only trust an experienced bankruptcy attorney for this one.
If your bankruptcy petition preparer tells you how to complete these schedules which are very legal in character they have committed unauthorized practice of law. Under Ohio law if you participate in any single element of a crime with another, you are guilty of aiding and abetting. That makes you as responsible for the crime as the person who committed it. Think in terms of the get away driver in a bank robbery.
On rare occasions the office of the United States Trustee in Cleveland has gone after bankruptcy petition preparers for unauthorized practice of law for advising debtors regarding the legal advice type schedules. Never have I seen a debtor dragged in. It could happen. Don’t risk it. Stay away from petition preparers.
Other Lawyers Writing on the Bankruptcy Alphabet
- Jay Fleischman, bankruptcy attorney in New York City
- Cathy Moran, Bay Area Bankruptcy Lawyer
- Omaha and Lincoln, Nebraska Bankruptcy Attorney, Ryan D. Caldwell
- Hawaii Bankruptcy Attorney, Stuart T. Ing
- Metro Richmond Consumer and Bankruptcy Attorney, Mitchell Goldstein
- Philadelphia Suburban Bankruptcy Lawyer, Chris Carr
- Los Angeles Bankruptcy Attorney, Mark Markus