If your phone rings with yet another unsolicited pitch for a loan you never asked about, a warranty you don’t need, or a credit card offer from a company you’ve never heard of, you’re not powerless. Federal law gives you the right to sue—and collect real money for every illegal call.

The Telephone Consumer Protection Act (TCPA) is one of the strongest consumer protection statutes on the books. It imposes strict penalties on companies that make automated or prerecorded calls to your cell phone without your consent. And unlike most federal claims, you don’t need a government agency to enforce it. You can file suit yourself.

This guide explains what the law covers, how to identify the companies behind the calls, and how to build a case that makes robocallers pay.

The numbers: The TCPA awards $500–$1,500 per illegal call or text, carries a four-year statute of limitations, and TCPA filings doubled in 2025—making it one of the most actively litigated consumer protection laws on the books.

What the TCPA Actually Prohibits

The TCPA targets several specific practices. If you’re receiving unsolicited loan pitches by robocall, chances are the caller is violating multiple provisions simultaneously.

• Autodialed or prerecorded calls to cell phones without prior express written consent. For marketing calls, verbal consent isn’t enough—the law requires written permission. If you never signed up for anything, every call is a separate violation.
• Do Not Call Registry violations. If your number is registered at donotcall.gov and you’re still receiving telemarketing calls, that’s an independent violation—even from live callers, not just robocalls.
• Calls after you’ve revoked consent. Under FCC rules effective April 2025, you can revoke consent by any reasonable means—saying “stop,” texting “STOP,” or telling the caller to remove you. The company has 10 business days to comply. Every call after that is a willful violation at the $1,500 tier.
• AI-generated voice calls. The FCC has ruled that AI-generated voices qualify as “artificial or prerecorded” under the TCPA. A call that sounds human but is actually AI is still covered.
• Calls outside permitted hours. Telemarketing calls before 8:00 a.m. or after 9:00 p.m. in your time zone violate the TCPA regardless of consent.

Step 1: Build Your Evidence File

Before you can sue, you need proof. Start documenting every unwanted call right now—even before you know who’s behind them.

What to Record for Every Call

• Screenshot your call log immediately. Date, time, and the number displayed. Don’t rely on memory.
• Save every voicemail. Prerecorded messages are direct evidence of a TCPA violation. Back them up to cloud storage or email them to yourself.
• Keep your phone bills. Carrier records show incoming call history and can be used to trace the source. Retain them for the full four-year limitations period.
• Keep a written log. Note whether the call was a prerecorded message or live person, what product or service was pitched, and whether you told them to stop calling.
• Don’t delete anything. Keep your phone handset through any litigation to prevent spoliation issues.

Step 2: Identify the Caller

This is the critical challenge. Robocallers hide behind spoofed numbers, shell companies, and third-party lead generators. But they can be found.

Answer and Extract Information

The most effective identification technique is counterintuitive: pick up the phone. Stay on the line, get transferred to the “live agent,” and before providing any personal information, ask: What company are you with? What’s your website? What’s your mailing address? Can you send me something by email? Even one of these details can be enough to identify the entity behind the calls and serve a complaint.

Use Technology and Public Records

• Reverse phone lookups. Services like Hiya, Nomorobo, CallerSmart, or even a Google search of the number can sometimes reveal the company or lead generator behind it.
• Check the FCC’s Robocall Mitigation Database. All voice service providers must certify their STIR/SHAKEN implementation status. This can help identify which VoIP provider originated the call. Search it at fcc.gov/robocall-mitigation-database.
• STIR/SHAKEN attestation data. The FCC’s caller ID authentication framework enables carriers to verify that caller ID information is legitimate. While there’s no private right of action under STIR/SHAKEN itself, the authentication data makes identifying robocallers in TCPA litigation far more practical. Your carrier may provide this information upon request.
• Subpoena carrier records. Once litigation is filed, you can subpoena your carrier’s call detail records and, through the originating carrier, trace back to the entity that placed the call. The Industry Traceback Group (ITG) also traces illegal robocalls back to their originating provider, and their data can surface through discovery.

Step 3: Confirm Your Legal Claims

For unsolicited loan marketing robocalls to your cell phone, you likely have multiple independent violations per call—each carrying its own statutory damages.

• No prior express written consent. Did you ever sign up, fill out a form, or click “I agree” authorizing calls from this company? If not, every call is a $500 violation—or $1,500 if the court finds it was willful.
• DNC Registry violation. If your number is registered and you’re receiving telemarketing calls, that’s a separate violation even without an autodialer.
• Failure to honor opt-out. Did you tell them to stop? Under the April 2025 FCC rule, they must comply within 10 business days. Every call after that is willful.
• No caller identification. TCPA regulations require telemarketers to identify themselves and the entity they represent and provide a callback number. Failure to do so is an additional violation.

Do the math: if a loan company has called you 20 times without consent, that’s potentially $10,000–$30,000 in statutory damages for your individual claim alone. The threat of class-wide exposure gives you significant settlement leverage.

Step 4: File and Litigate

You can bring a private action under the TCPA in federal or state court. You don’t need to show actual damages—statutory damages are automatic. Here’s how to maximize your position.

• File complaints with the FCC and FTC. Report violations at fcc.gov and ReportFraud.ftc.gov. These won’t litigate for you, but they create a public record of the caller’s behavior that strengthens your case.
• Consider both individual and class claims. If the same company is blasting robocalls to thousands of people, a class action multiplies the damages exponentially—and your leverage with it.
• Name the right defendants. Go after the company whose product is being marketed, not just the call center. The TCPA applies to the entity “on whose behalf” the call is made, which means the lender or lead buyer can be liable even if they hired a third-party dialer.
• Pursue FDCPA claims in parallel. If the robocalls relate to debt collection rather than marketing, you may have additional claims under the Fair Debt Collection Practices Act, which provides separate damages.

Your Robocall Action Plan

1. Register your number on the National Do Not Call Registry at donotcall.gov if you haven’t already.
2. Start logging every unwanted call—date, time, number, content. Screenshot your call log and save voicemails.
3. Answer the next robocall and extract the company name, website, email, or mailing address.
4. Tell the caller to stop. Say “stop calling me” clearly. Note the date. This starts the willful-violation clock.
5. Run reverse lookups on the calling numbers. Check the FCC’s Robocall Mitigation Database.
6. Keep your phone and phone bills. Do not switch devices or delete records during the limitations period.
7. File complaints with the FCC and FTC to create a public record.
8. Consult with a consumer protection attorney to evaluate your claims and file suit.

Key Legal Developments to Know

TCPA law is evolving rapidly. A few developments that strengthen your hand in 2025–2026:

• FCC consent revocation rule (effective April 2025). Consumers can now revoke consent by any reasonable means—”stop,” “quit,” “end,” “opt out,” “cancel,” or “unsubscribe.” Companies get 10 days, then every subsequent contact is willful.
• AI voice calls are covered. The FCC’s February 2024 Declaratory Ruling confirmed that AI-generated voices are “artificial or prerecorded” under the TCPA. Companies can’t dodge the law by using natural-sounding AI.
• STIR/SHAKEN is making callers traceable. The FCC’s caller ID authentication framework, mandated by the TRACED Act, makes it increasingly difficult for robocallers to hide behind spoofed numbers. While there’s no private right of action under STIR/SHAKEN, the data it generates is invaluable in TCPA litigation.
• Courts are setting standards independently. A 2025 Supreme Court decision shifted TCPA interpretation authority from the FCC to the courts, meaning judges now set their own standards—and many are ruling favorably for consumers.

If robocall harassment has contributed to financial stress or overwhelming debt, you don’t have to face it alone. Lakelaw’s bankruptcy attorneys have helped thousands of people find a fresh financial start. Contact us today for a free, confidential consultation.

How Fraudsters Exploit Lawyers, Trust Accounts, and the Prestige of Your License

By David P. Leibowitz

You went to law school to help people, not to become a money mule. But to a new breed of international fraudster, your law license, your trust account, and your professional instinct to help a client in need make you the perfect target.

These scams aren’t crude. They’re engineered to exploit the specific mechanics of legal practice—IOLTA accounts, escrow obligations, the duty to act on a client’s behalf, and the time pressure of transactions. The FBI has issued repeated warnings. State bars across the country post new alerts nearly every month. Yet lawyers keep falling for these schemes, sometimes to the tune of hundreds of thousands of dollars, because the scams are designed to look exactly like the legitimate work lawyers do every day.

If you handle collections, real estate closings, business transactions, or any matter that involves receiving and disbursing funds, you need to read this.

The Fake Collection Client

This is the most widespread scam targeting lawyers, and the FBI has flagged it repeatedly. Here’s how it works: you receive an email—often from someone overseas—asking whether you handle debt collection in your state. The story is always plausible. A foreign company is owed money by a U.S.-based debtor. They need local counsel to send a demand letter and collect the funds.

You agree. You send the demand letter. And then something remarkable happens: the debtor agrees to pay immediately—in full, no negotiation, no pushback. A cashier’s check arrives at your office, often drawn on a Canadian bank or another institution that’s difficult to verify quickly. You deposit it into your IOLTA account. Your “client” asks you to wire the proceeds—minus your fee—to an overseas account.

Days later, your bank notifies you that the check was counterfeit. The funds are clawed back. But the wire you sent is gone. And because it came out of your trust account, you are personally liable for every dollar.

Red Flags

• Unsolicited contact from an overseas “client” you’ve never met, often with a vague or generic email address.
• The debtor capitulates immediately with no negotiation—the fastest, easiest collection of your career.
• Payment arrives by cashier’s check, often from a Canadian or foreign bank, sometimes for more than the alleged debt.
• The client pressures you to wire funds quickly, before the check has fully cleared—often citing an “urgent business need.”
• Communication is exclusively by email. The client resists phone calls, video conferences, or any verification of identity.

How to Protect Yourself

• Never disburse funds until a check has fully cleared. Cashier’s checks can take weeks to be returned as counterfeit. Your bank’s “available balance” is not confirmation that funds are good.
• Verify the client independently. Search the company name, check business registries, and insist on a video call before accepting the engagement.
• Be suspicious of any collection where the debtor pays without resistance. In what universe does a debtor immediately agree to pay a demand letter in full, from a lawyer they’ve never heard of?
• Call the issuing bank directly to verify the cashier’s check—using a number you find independently, not one printed on the check itself.

The Real Estate Wire Intercept

Business email compromise has become the most financially devastating form of cybercrime targeting the legal profession. The FBI’s 2024 Internet Crime Report documented over 21,000 BEC complaints with losses exceeding $2.7 billion—and real estate transactions are among the most frequently targeted.

Here’s the scenario: you’re handling a closing. Somewhere in the email chain, a hacker has been quietly monitoring the thread—often for weeks. At the critical moment, just before closing, someone in the transaction receives an email that appears to come from you, from the title company, or from the lender. It contains “updated” wire instructions. The email uses the right logos, the right tone, and references the correct property and transaction details. The only thing different is the account number—which now routes to a fraudster’s account.

Red Flags

• Last-minute changes to wiring instructions sent via email, especially close to the closing date.
• Subtle changes to email addresses—a single character swap, a different domain extension, or a display name that doesn’t match the actual address.
• Unusual urgency in the request: “This needs to go out today” or “time is of the essence.”
• The email thread feels slightly off—different formatting, a different signature block, or a tone that doesn’t match the sender’s normal style.

How to Protect Yourself

• Establish a firm policy: wiring instructions never change by email. Communicate this to all parties at the outset of every transaction.
• Verify all wiring instructions by phone using a known number—never a number from the email itself.
• Enable multi-factor authentication on all firm email accounts. A compromised inbox is the most common entry point for these attacks.
• Train every person in your office who touches financial transactions. Paralegals, assistants, and bookkeepers are often the ones who actually initiate wires.

Escrow and Trust Account Abuse

Your IOLTA account is a laundromat waiting to happen—at least, that’s how criminals see it. Money that passes through a lawyer’s trust account acquires a veneer of legitimacy. Sophisticated fraud rings know this, and they’re engineering scenarios designed to push funds through your escrow in ways that make you an unwitting participant in money laundering.

Common setups include: an overseas “client” asks you to hold funds in escrow pending a business transaction that never quite materializes, or a new client asks you to receive a wire, hold it briefly, and forward it to a third party minus your fee. The transaction may be framed as an equipment sale, a consulting agreement, or a settlement of a foreign dispute. The funds are real—but they’re stolen. And when law enforcement traces the money, the trail leads to your trust account.

Red Flags

• A client asks you to receive and forward funds with no substantive legal work beyond holding money.
• The transaction structure doesn’t make legal sense. Why does an equipment sale between two foreign parties need a U.S. lawyer to hold escrow?
• Multiple parties you can’t independently verify—the “buyer,” “seller,” and “client” may all be the same person or organization.
• The client is indifferent to your fee or offers an unusually generous retainer for minimal work.

How to Protect Yourself

• Never let your trust account be used as a payment pass-through. If the primary purpose of your engagement is to receive and forward funds rather than provide legal services, walk away.
• Know your client. Conduct due diligence that goes beyond a signed engagement letter. Verify corporate registrations, confirm identities, and understand the economic substance of the transaction.
• Understand your obligations under anti-money laundering frameworks. While the U.S. hasn’t adopted the ABA’s recommended “gatekeeper” rules in full, the ethical and criminal exposure is real.
• Consult your state bar’s ethics hotline if a potential engagement feels unusual. Most bars are happy to help you spot a scam before it becomes a disciplinary matter.

The Overpayment Scam

A variation on the collection scam, but worth its own section because it’s devastatingly effective. A new client retains you for a straightforward matter—a contract dispute, a personal injury settlement, a family law collection. A check arrives, but it’s for more than the agreed amount. The client apologizes for the “error” and asks you to deposit the check, keep your fee, and wire the overage back.

The check is fraudulent. The “error” was the whole point. And you’ve just wired clean money from your trust account to a criminal.

How to Protect Yourself

• Any overpayment followed by a request to return the excess is a scam. Full stop. Legitimate clients do not accidentally overpay and then urgently need the difference wired to a third-party account.
• Return overpayments by the same method they arrived. If a check came in, send a check back to the same account. Never wire a refund from a check deposit.
• Wait for final clearance—not “available funds.” Banks make funds “available” long before a check has truly cleared. Cashier’s checks drawn on foreign banks can take weeks to bounce back.

AI-Powered Impersonation

Artificial intelligence has made these scams dramatically more convincing. Fraudsters now use AI to generate flawless legal correspondence, clone the voices of known contacts, and create deepfake video. A scammer posing as a foreign client can now produce emails that read like they were written by a sophisticated business professional—because they were written by an AI trained on corporate communications.

More alarmingly, the FBI has warned of criminal operations that impersonate existing law firms and real attorneys, complete with cloned websites and fabricated bar credentials, to victimize people who’ve already been scammed once. Your name and your firm’s reputation can be weaponized without your knowledge.

How to Protect Yourself

• Monitor your firm’s online presence. Periodically search for your name, your firm name, and your bar number to check for impersonation websites or fraudulent use of your credentials.
• Don’t rely on the quality of written communications as a trust signal. AI has eliminated grammatical errors as a reliable red flag. A perfectly written email no longer means a legitimate sender.
• Verify voice and video. If a client or counterparty calls with an urgent financial request, hang up and call back at a known number. AI voice cloning is now available to anyone.

The Lawyer’s Fraud Prevention Checklist

Eight Rules to Protect Your Practice

1. Never disburse trust funds until checks have irrevocably cleared. “Available” doesn’t mean “good.”
2. Verify every new client’s identity independently—especially those who contact you unsolicited from overseas.
3. Insist on live communication. Clients who refuse phone or video calls are a serious red flag.
4. Never wire funds to a third party you haven’t independently confirmed.
5. Treat wiring instruction changes as hostile until verified by phone.
6. If a collection or transaction seems too easy, it’s probably a trap.
7. Refuse to let your trust account be used as a pass-through.
8. Document your due diligence. If you’re ever investigated, your file should show what you checked and when.

If You Suspect You’ve Been Targeted

Speed matters. If you’ve deposited a suspicious check or wired funds based on a potentially fraudulent instruction, act immediately.

• Contact your bank’s fraud department and request an immediate recall of any outgoing wires. Recovery rates drop sharply after the first 24 hours.
• Notify your state bar. Most bars have dedicated scam reporting channels and will not treat your report as a disciplinary matter.
• File a report with the FBI’s IC3 at ic3.gov and with the FTC at ReportFraud.ftc.gov.
• Notify your malpractice carrier immediately. Prompt reporting is typically a condition of coverage.
• Preserve all communications—emails, texts, checks, wire confirmations. These are evidence.
• Alert colleagues in your local bar. Scammers often work geographic regions systematically. If they targeted you, they’re targeting other lawyers in your area.

There is no shame in being targeted. These are professional criminals running industrial-scale operations. The shame would be in not warning your colleagues. Share this guide with every lawyer you know.

If fraud has left you or your clients facing overwhelming debt, you don’t have to face it alone. Lakelaw’s bankruptcy attorneys have helped thousands of people find a fresh financial start. Contact us today for a free, confidential consultation.

Fraud isn’t what it used to be. Gone are the days of obvious Nigerian prince emails riddled with typos. Today’s scammers are sophisticated, patient, and deeply manipulative. They use artificial intelligence to clone voices, craft flawless phishing emails, and build elaborate fake identities. They exploit trust, urgency, and emotion—the very qualities that make us human.

The good news? Once you understand how these schemes work, they become far easier to spot. This guide walks through the most common types of fraud people encounter today and offers concrete steps you can take to protect yourself and the people you care about.

Phishing: The Gateway to Almost Every Scam

Phishing is the bread and butter of modern fraud. A scammer sends you a message—by email, text, or even a phone call—that appears to come from a trusted source: your bank, the IRS, Amazon, your employer, or a delivery service. The message creates urgency (“Your account has been compromised!”) and pushes you to click a link, open an attachment, or hand over personal information.

How to Protect Yourself

• Slow down. Urgency is the scammer’s best weapon. If a message demands you act immediately, that’s your cue to pause and verify independently.
• Never click links in unexpected messages. Instead, go directly to the company’s website by typing the URL yourself, or call the number on the back of your card.
• Inspect sender addresses carefully. Scammers use addresses that look almost right—like support@amaz0n-security.com instead of a real Amazon domain.
• Enable multi-factor authentication (MFA) everywhere. Even if a scammer steals your password, MFA makes it dramatically harder for them to access your accounts.

Bank and Government Impersonation

This is phishing’s more aggressive cousin. You receive a call or text claiming to be from your bank’s fraud department, the Social Security Administration, or even law enforcement. The caller ID might actually display your bank’s name—scammers can spoof that. They’ll tell you your account has been compromised and instruct you to move your money to a “safe” account, hand over login credentials, or purchase gift cards to “resolve” a supposed legal issue.

The manipulation is powerful because it exploits authority and fear. When someone tells you your life savings are at risk, rational thinking goes out the window.

How to Protect Yourself

• Your bank will never ask you to move money to a “safe” account. This is not a real thing. If anyone says this, it’s a scam. Period.
• Hang up and call back. Don’t use a number the caller gives you. Look up your bank’s number independently and call them directly.
• No legitimate entity will ever ask for gift cards as payment. Not the IRS, not your bank, not the police. Gift card payment requests are always a scam.
• Don’t trust caller ID. Technology makes it trivially easy to make a call appear to come from any number.

Romance Scams: When Love Is a Lie

Romance scams are among the most emotionally devastating forms of fraud. A scammer creates a fake profile on a dating app or social media platform and builds a relationship with you over weeks or months. They’re attentive, charming, and seemingly perfect. There’s always a reason they can’t meet in person—they’re deployed overseas, working on an oil rig, or traveling for business.

Once a strong emotional bond is established, the requests for money begin. A medical emergency, a business deal gone wrong, a plane ticket to finally come see you. The amounts escalate. Victims have lost hundreds of thousands of dollars—sometimes their entire retirement savings—because the emotional connection felt so real.

How to Protect Yourself

• Be wary of anyone who can never meet in person or video chat. Scammers will always have excuses. A real person who cares about you will find a way to be present.
• Never send money to someone you haven’t met in person. No matter how compelling the story. This is the single most important rule.
• Do a reverse image search on their photos. Scammers steal photos from real people’s social media profiles. A quick search can reveal whether the images appear elsewhere online.
• Talk to someone you trust. Scammers isolate their victims. If a friend or family member raises concerns about your online relationship, listen to them with an open mind.

Pig Butchering: The Long Con of Fake Investments

The term “pig butchering” comes from the Chinese phrase “shā zhū pán,” which refers to fattening a pig before slaughter. It’s a chillingly accurate metaphor. In these scams, a stranger contacts you—often through a “wrong number” text, a dating app, or social media—and gradually builds rapport. After weeks of friendly conversation, they casually mention an incredible investment opportunity, usually in cryptocurrency.

They guide you to a professional-looking but completely fake trading platform. You invest a small amount and watch your “returns” grow. Encouraged, you invest more. The platform shows impressive gains. But when you try to withdraw your money, you discover it’s gone. The platform was fake, the returns were fabricated, and the person you trusted was a scammer—or tragically, in many cases, a trafficking victim forced to run the scam.

How to Protect Yourself

• Be deeply skeptical of unsolicited investment advice from strangers. Nobody reaches out to random people to share a genuinely profitable investment opportunity.
• Research any trading platform independently. Check whether it’s registered with the SEC or FINRA. If you can’t find it on established regulatory databases, don’t use it.
• Guaranteed high returns don’t exist. Any investment that promises consistent, outsized returns with little risk is either a scam or something that will eventually become one.
• Be cautious of “wrong number” texts that turn into friendships. This is a classic pig butchering opener. A real wrong number doesn’t lead to a months-long relationship and investment tips.

AI-Powered Scams: The New Frontier

Artificial intelligence has supercharged fraud. Scammers can now clone a loved one’s voice from a few seconds of audio scraped from social media and use it to call you in a panic, claiming they’ve been arrested or are in danger. AI-generated deepfake videos can make it look like a trusted figure—a CEO, a celebrity, or even a family member—is endorsing a scam. Phishing emails crafted by AI are grammatically flawless and personalized in ways that make them nearly indistinguishable from real communications.

How to Protect Yourself

• Establish a family code word. Agree on a secret word or phrase with your close family members. If someone calls claiming to be a loved one in distress, ask for the code word before taking any action.
• Verify independently. If you receive an alarming call from someone you know, hang up and call them directly at their known number.
• Be skeptical of celebrity endorsements for investments. Deepfake videos of public figures promoting crypto or investment schemes are increasingly common. Always verify through official channels.

Universal Rules for Staying Safe

Regardless of the specific type of scam, a handful of principles will protect you from the vast majority of fraud attempts.

1. If it feels urgent, slow down. Scammers manufacture panic.
2. Verify through independent channels. Never use contact info the suspicious party provides.
3. Never send money to someone you haven’t met in person.
4. If it sounds too good to be true, it is.
5. Talk to someone you trust before making any financial decisions based on an unexpected contact.
6. Protect your digital life. Use unique passwords, enable MFA, and keep software updated.

What to Do If You’ve Been Scammed

If you’ve fallen victim to fraud, act quickly. There is no shame in being scammed—these criminals are professionals, and they target smart, capable people every day. What matters is what you do next.

• Contact your bank or financial institution immediately. Freeze accounts and attempt to recover funds.
• File a report with the FTC at ReportFraud.ftc.gov and with the FBI’s Internet Crime Complaint Center (IC3) at ic3.gov.
• Change your passwords on any accounts that may have been compromised.
• Place a fraud alert or credit freeze with the three major credit bureaus (Equifax, Experian, TransUnion).
• Seek support. Fraud can be emotionally devastating. Talk to trusted friends, family, or a counselor. You are not alone, and this was not your fault.

Scammers succeed by exploiting trust, emotion, and urgency. Your best defense is awareness, skepticism, and a willingness to pause before you act. Share this guide with someone you care about—because the more people who understand how these schemes work, the harder it becomes for fraudsters to find their next victim.

If fraud has left you facing overwhelming debt, you don’t have to face it alone. Lakelaw’s bankruptcy attorneys have helped thousands of people find a fresh financial start. Contact us today for a free, confidential consultation.

Entering 2025, more and more Americans are falling behind on their bills as consumer debt continues to skyrocket.

US households are relying more heavily on credit cards in order to meet basic needs and combat the mounting economic pressures — rising inflation, historically high auto loan payments, soaring student loan debt, insufficient retirement savings, and more.

We’ll dive into key factors behind this consumer debt crisis and explore potential debt relief solutions, including personal bankruptcy.

As Inflation Increases, So Does Financial Insecurity

The cost of living in 2024 still remains higher than in previous years, despite the Fed attempting to lower and stabilize inflation at their 2% target rate.

According to an October 2024 Bank of America survey, nearly 45% of Americans perceived themselves as living paycheck to paycheck. Housing, transportation, and utilities are getting more expensive, forcing individuals and families to make difficult choices like maxing out their credit cards or cutting back on essentials.

Groceries alone have gone up by 2.3% compared to this period last year. The US Department of Agriculture (USDA) reported a 2.5% increase for the cost of meats, and a 40% spike for the cost of eggs.

Stronger Reliance on Credit Cards for Basic Needs 

With high inflation and stagnant wages, many Americans have turned to credit cards as a lifeline for covering basic needs.

The Federal Reserve Bank of New York reported that credit card debt in the US has now surpassed $1.14 trillion dollars, which is 5.8% higher than the same period last year. It only pushes consumers to persistent debt with the average APRs having now reached a record-high of 22.8%, according to the Federal Reserve Board.

Consequently, Americans are struggling to make minimum payments. The risk of penalties and lower credit score make borrowing even more costly.

Read our blog article on how to clear your debt when you have maxed out credit cards.

The Costly Resurgence of Student Loan Payments

The COVID-19 pause on student loans set interest rates to 0%, which gave borrowers an opportunity to pay student loans interest-free or take a break from paying altogether. However, in September 2023, the 3-year long administrative forbearance came to an end.

Now there are over 46 million borrowers with an outstanding total balance of $1.75 trillion dollars in federal and private student loan debt, paying an estimated $500 per month. This financial strain has borrowers resorting to deferred payments, income-driven repayment plans, or applying for a student loan discharge.

Rainy Day Funds Are Depleting & Disappearing

With a lack of emergency funds comes a lack of financial preparedness.

According to Bankrate’s 2024 annual emergency fund report, 56% of US adults wouldn’t be able to pay for an emergency expense of $1,000 or more. This could be a trip to the emergency room, unexpected car repair, or income to pay for expenses while between jobs.

Financial advisors generally suggest setting aside at least 3 to 6 months of living expenses for life emergencies. Start rebuilding your rainy day fund by opening up a savings account and budgeting your expenses each month.

Seek a Way Out with Debt Relief Programs

If your debt continues to pile up and starts to feel unmanageable, consider bankruptcy, debt consolidation, and other debt relief options.

Chapter 7 bankruptcy wipes out all unsecured debts like credits cards or medical bills in exchange for selling some of your assets, often taking a few months to complete.

Chapter 13 bankruptcy lets you keep your assets and puts you on a reorganization plan to pay back a portion of your debt over a 3-5 year timeframe based on what you can afford.

Yes, your credit scores will be impacted, but they offer a fresh start for what may seem like an inescapable cycle of debt. Also, the stigma of bankruptcy has lessened over the years as many Americans have recognized that it’s more important to regain their financial stability than handle an uphill battle all by themselves.

Safely & Confidently Navigate Bankruptcy with Lakelaw

If you’re struggling with debt, you don’t have to go through this alone. Financial challenges can be overwhelming, but facing them is a true sign of strength, not failure.

At Lakelaw, we will take care of you with the kindness, courtesy, respect, professionalism, and dedication that has been our hallmark since we were founded in 1999.

We’ve been named one of the best bankruptcy law firms in the country by Best Lawyers, Super Lawyers, U.S. News & World Report, Martindale-Hubbell, and Lawdragon. We also have over 50 5-star reviews across Google and Yelp.

Thanks to inflation, you can make over $100,000 and still file for Chapter 7 bankruptcy. 

Here in Illinois, a married couple without children can make up to $84,000 and still qualify for Chapter 7 bankruptcy. Even a family of 4 can make $120,000 and still be qualified to file Chapter 7. That’s all because of the “Means Test.”

 

What Is the Bankruptcy Means Test & How Does It Work?

 

The Bankruptcy Means Test is a calculation that takes your average monthly income from the past 6 months and compares it to the median income for a same sized household in your state.

According to Cubit, the median income for households in Illinois in 2024 is $78,433. Even if you find yourself making more, your disposable income may be lower after deducting consumer debt obligations and monthly expenses such as rent, utilities, food, transportation, and childcare.

If you make less than the median income, you can file Chapter 7 bankruptcy without regard to the Means Test if your filing is not otherwise considered “abusive”. Don’t worry; if you are thinking of filing a case, your budget probably leaves nothing over from paycheck to paycheck. Your bankruptcy case won’t be an abuse.

You can check your eligibility by filling out the following means test forms:

• Form 122A-1: Chapter 7 Statement of Your Current Monthly Income
• Form 122A-2: Chapter 7 Means Test Calculation
• Form 122A-1Supp:  Statement of Exemption from Presumption of Abuse Under § 707(b)(2)

 

What If I Don’t Pass the Means Test?

 

You can still qualify for alternative debt relief solutions if you don’t pass the means test for Chapter 7 bankruptcy, such as debt consolidation or debt settlement.

You can also file for Chapter 13 bankruptcy if you have regular income to make monthly payments. While in a repayment plan, creditors are legally prohibited from suing or garnishing wages.

At Lakelaw, we will help you analyze your finances. Our bankruptcy lawyers will calculate the allowances and deductions you are entitled to take under the Means Test calculation.

We will investigate whether there are special circumstances which allow you to overcome the presumption of abuse that arises if you want to file a bankruptcy case and make more than the median income cut-off points.

If it turns out that you must file for Chapter 13, we will do everything legally possible to minimize the payments you would have to make during your Chapter 13 repayment plan.

 

Safely & Confidently Navigate Bankruptcy with Lakelaw

 

If you are thinking about filing for bankruptcy, it’s probably because the pressure of credit card payments, garnishment, collection calls, and other creditor harassment is driving you crazy. 

Don’t be afraid. We at Lakelaw will take care of you with the kindness, courtesy, respect, professionalism, and dedication that has been our hallmark since we were founded in 1999. If we need to go to bat for you in court, we will always represent you fearlessly and zealously. With close to 50 years of practice, we can speak truth to power on your behalf. And we will.

 

A Day of Historic Wins

We knew we had a great day at the Lakelaw office when our friends and fellow attorneys were congratulating us on our back-to-back victories. So we thought we should tell our friends about it, too.

Bankruptcy Court Case Win #1: Green v. Leibowitz

On Tuesday, July 16, 2024, the Seventh Circuit Court of Appeals issued its opinion in Green v. Leibowitz, affirming David Leibowitz’s position as the bankruptcy trustee that a Canadian retirement plan was subject to creditors’ claims and not exempt under Illinois law.

This decision culminated two years of litigation in the bankruptcy court, the district court, and finally, the Seventh Circuit Court of Appeals. The Seventh Circuit even cited another Lakelaw win, People ex rel Leibowitz v. Family Vision Services, an Illinois Supreme Court decision that David Leibowitz won, in support of its decision.

Before becoming a bankruptcy lawyer, David Leibowitz started his career as a clerk to a judge and former professor in the Illinois Appellate Court. David has successfully appealed in the Illinois Appellate Court and the Illinois Supreme Court, as well as bankruptcy appeals in the federal district court and appeals in the Seventh Circuit Court of Appeals. He has been on the brief in two matters in the United States Supreme Court.

Get a free confidential consultation today.

Bankruptcy Court Case Win #2: Chapter 11 Reorganization

Our winning streak continued later that afternoon. 

David Leibowitz asked the bankruptcy court to stop lawsuits against the principals of his Chapter 11 debtor client, so that they could focus on reorganizing their company in Chapter 11. 

Most of David’s friends discouraged him from trying this because they said a bankruptcy court would never grant this relief. But David knew this particular judge had granted precisely this sort of motion in another case 14 years ago. And despite opposition from 4 opponents and over 2 hours of their argument, Judge Cox issued a written, published opinion, enjoining or stopping, the lawsuits against the debtor’s principals so they could formulate their Chapter 11 bankruptcy plan without outside interference and costs.

This victory came only two weeks after David filed his emergency motion for an injunction. Sometimes, justice can be swift as well as effective.

Secure Your Victory with Our Award-Winning Law Firm

At Lakelaw, you can count on being represented fearlessly and passionately. 

Named one of the best bankruptcy law firms in the country by Best Lawyers, Super Lawyers, U.S. News & World Report, Martindale-Hubbell, and Lawdragon, we take great pride in providing all of our clients with razor-sharp and ethically sound legal services.

Safely navigate personal and business bankruptcy with lawyers who care. 

This month marks the 25th anniversary of Lakelaw!

From a tiny office in Steve Simonian’s suite in Waukegan, Illinois, Lakelaw grew to five offices along the shore of Lake Michigan from Chicago to Milwaukee, Wisconsin.

Our team of bankruptcy lawyers have always focused on helping people and businesses with financial difficulties. We have also been proud of our public service, having won numerous awards for our pro bono service, including the prestigious Excellence in Pro Bono Service Award from the District Court for the Northern District of Illinois.
 

What’s In Store for the Next 25+ Years

 
Now we celebrate the addition of two new members, John Hiltz and Blair Zanzig. These distinguished attorneys will ensure that Lakelaw will continue to serve clients excellently, retaining our core values of “Care, Kindness, Courtesy, Respect, and Dedication.” Stay tuned for more details and watch for updates on our website.

Lakelaw thanks our loyal clients and friends for their support over the past 25 years. We look forward to even greater things in the next quarter century and beyond.
 

An essential backbone of the global economy, more and more trucking companies are going out of business. Challenges such as fuel price changes, regulations, labor shortages, and economic downturns can harm the industry’s stability and financial health. 

Bankruptcy law can help trucking companies survive in these difficult times. Speak with a trusted bankruptcy attorney today.

Troubles Facing the Trucking Industry

Fluctuating Fuel Prices

Fuel costs are a big expense for trucking companies. Volatility in oil prices can greatly impact their bottom line. Expensive fuel can make it difficult for companies, especially small ones, to make money and stay afloat.

Stringent Regulations

Trucking companies must follow many complex state and federal regulations, from vehicle pollution to how long drivers can work. Compliance with these regulations can be costly and time-consuming. 

For example, the Electronic Logging Devices (ELD) mandate, which requires drivers to electronically record their driving hours, has imposed additional financial burdens on many operators.

Labor Shortages

The industry is currently facing a significant driver shortage. This is magnified by an aging workforce and the challenge of attracting younger drivers. This shortage can lead to increased wages and benefits costs, further straining the financial resources of trucking companies.

Economic Downturns

Recessions can lead to decreased demand for freight services, as businesses reduce production and consumers cut back on spending. Such downturns can be devastating for trucking companies, particularly those heavily reliant on industries sensitive to economic cycles, like manufacturing and retail.

Rising Insurance Costs

Trucking companies naturally face high insurance premiums because of the inherent risks associated with transporting goods over long distances. These costs have been steadily increasing, partly due to the rise in litigation and settlement amounts against trucking companies involved in accidents.

Maintenance and Equipment Costs

The cost of maintaining and updating trucks and equipment can be substantial. As technology advances, older vehicles may become obsolete or require expensive upgrades to remain compliant with regulatory standards.

Why You Should Consider Declaring Bankruptcy

Many people often view bankruptcy as a last resort, but it can provide a lifeline for trucking companies facing hard times. By filing for bankruptcy, a company can restructure its debts, reduce its obligations, and emerge as a more competitive and financially stable entity.

Here are 5 benefits of filing for bankruptcy for your trucking company.

Automatic Stay

Upon filing for bankruptcy, an automatic stay is immediately enacted. This halts all collection activities, including lawsuits, repossessions, and foreclosures. This reprieve can provide trucking companies with the breathing room needed to reorganize without the constant pressure from creditors.

Debt Restructuring

Bankruptcy allows for the restructuring of debts. For example, under Chapter 11, a trucking company can propose a reorganization plan for renegotiating terms with creditors, downsizing operations to reduce costs, or liquidating assets to pay off debts. This process enables the company to realign its financial obligations with its current capacity to pay.

Discharge of Unsecured Debts

Bankruptcy can lead to the discharge of certain unsecured debts, such as credit card debts, unsecured business loans, and some judgments. Eliminating these obligations can significantly reduce the overall debt burden, freeing up resources for essential expenses like fuel, maintenance, and payroll.

Contract and Lease Modifications

Chapter 11 bankruptcy offers the opportunity to reject or modify existing contracts and leases that are no longer favorable or sustainable. This can be particularly useful for renegotiating lease terms on vehicles or equipment, potentially leading to lower monthly payments.

Fresh Start

Successfully emerging from bankruptcy can provide a trucking company with a fresh start. With a more manageable debt load and streamlined operation, the company can focus on profitability and long-term sustainability without the weight of past financial missteps.

Navigating Bankruptcy in the Trucking Industry

The decision to file for bankruptcy should not be taken lightly. It involves careful consideration of the company’s financial situation, future prospects, and the potential impact on employees, customers, and business relationships. 

If your trucking company is at risk of going out of business, Lakelaw can help.

With over 50 years of experience in bankruptcy law, David P. Leibowitz is nationally recognized for excellence by Super Lawyers, Martindale-Hubbell, Lawdragon, and more. David has also represented numerous trucking companies and assisted them with cost reduction, reorganization, and asset liquidation.

I’m worried about you, especially with more and more people on the verge of maxing out their credit cards. 

Credit cards are extremely convenient and easy to use. With the holidays coming up – Black Friday, Small Business Saturday, Cyber Monday, Hanukkah, Christmas – there are all kinds of incentives to buy. But with temptation to charge comes consequences at large.

Alarming Credit Card Debt Statistics

People are using their charge cards at very high rates – between 80-90% of availability. This is red alert territory.

According to LendingTree, as of December 2022, Illinois ranks 16th in the country for the highest average credit card debt per person ($7,756). Also, the 30-day delinquency rate – or the percentage of total outstanding credit card balances at least 30 days overdue – climbed to 2.77% by the second half of 2023. That’s the highest rate seen since Q3 2012.

Here are some more key statistics pulled from WalletHub’s national survey: 

• 56% of Americans say they have more credit card debt than they did 12 months ago
• 57% of Americans with credit card debt say it will take them more than a year to pay it all off
• 54% of Americans say that credit cards overall have cost them more money than saved them money
• 23% of Americans are in debt because of frivolous spending
• 24% of Americans would move in with their in-laws to get out of credit card debt

For us, this is an early warning sign of bankruptcy. Credit card companies start dunning you when you are 60 days behind payment. They may even file suit and garnish your wages when you fall 90 days or more behind.

Want a brighter financial future? Speak with an experienced debt consolidation lawyer.

What Happens If You Max Out a Credit Card?

Having a maxed out credit card means that you’ve met or exceeded your credit card limit. You have no more borrowing power until you pay off the monthly minimum amount plus interest.

New spending habits must be created in order to pay off a maxed out credit card. Here are some ways you can do just that.

1. Hide Your Credit Cards

Yes, physically take out your maxed out credit cards from your wallet and lock them in a vault. Freeze your cards, then hide them in a secure and inconspicuous place – behind a picture frame, buried in a potted plant, inside the freezer.

You can also leave your cards with a loved one. This creates more visibility and accountability on your part for tackling the debt head-on, not continuing to build on it.

2. Remove Digital Wallets

Apple Wallet, Google Wallet, Amazon, Uber, Lyft, DoorDash – these are common places where you can store your payment information and make online purchases with just a single tap.

Remove saved credit cards from your apps and online accounts. If you need to make a purchase, use your debit card or a payment service that’s linked to your bank account like PayPal or Venmo.

3. Calculate What You Owe

The principal might be $4,000 right now, but you’ll need to pay off more than the minimum amount each month if you want to make a significant dent on your credit card balance.

We recommend using a credit card minimum payment calculator to determine exactly what your payment schedule must look like in order to wipe clean of your debt. Use this time to carefully examine your budget and cut out things that you don’t need.

4. Start Paying Off Your Debt

Figure out which credit card has the highest rate of interest and put as much as you can above the minimum payment on that card until you pay it off. Repeat with the card with the next highest rate.

Make sure to redeem any accumulated reward points you have accrued for spending or paying off your credit card balance. These statement credits will help speed up the repayment process.

5. Negotiate with Credit Card Issuers

Don’t have any money left over to pay your debt? Contact each credit card company and ask them to reduce their interest rate. It never hurts to ask. If you have good credit, you may be eligible to transfer one balance to another credit card. 

Settle Your Debt with a Credit Card Debt Lawyer

Chapter 7 or Chapter 13 bankruptcy are last resort options to consider for outstanding debt. If you are being sued, garnished, can’t sleep, or can’t deal with your debt, contact David P. Leibowitz from Lakelaw – Chicago’s most trusted bankruptcy law firm. 

At Lakelaw, we have represented over 10,000 cases in the past 50 years, helping our clients to confidently navigate through any financial crisis. We have also been recognized for excellence by every rating service in the industry including Super Lawyers 2024 and Martindale-Hubbell Client Champion 2023.

At Lakelaw, we represent you fearlessly and zealously. Contact us today to schedule a free confidential consultation.

Post-Collapse: The Uncertain Lifespan of Cryptocurrency

What happens to your crypto when you die? Or when your cryptocurrency goes bankrupt?

Bitcoin, Etherium, Dogecoin, Litecoin, Monero, and other popular cryptocurrencies can’t be saved on your computer. And by its nature alone – not FDIC insured, high volatility, pseudonymous-esque transactions, legal uncertainty – you can’t keep crypto in a bank either.  There are horror stories about people dying with loads of crypto assets on their devices and their survivors unable to find the key.

For this reason, crypto exchanges have flourished. But in the 2022 collapse, household names in the crypto industry – Celsius Network, Voyager Digital, FTX, BlockFi – all filed for bankruptcy under Chapter 11. On top of these security risks, crypto owners now need to be hyper aware of crypto bankruptcies and how to navigate around them.

What Happens If the Crypto Exchange Goes Bust?

If you lost funds to a cryptocurrency when it declared bankruptcy, you may be eligible to file a customer claim.

Crypto wallets protect your digital currencies. Coinbase, SafePal, Exodus, and Guarda are some “hot wallets” on the crypto market. If you have a wallet, then you can argue that the crypto exchange is simply holding what you own as a “custodian” and that the ownership remains yours. But if you don’t have a wallet, you may find yourself simply holding a claim. 

Here’s the interesting part. If you have a claim, that claim is calculated in the dollar value of what you have as of the date of the filing of the bankruptcy.

So, any upside in the increase in value of the cryptocurrency after the filing of the bankruptcy case no longer belongs to you – any more than if your claim was for a gold bar. Your claim would not be for the gold bar but rather for the value of the gold bar as of the date of the filing of the bankruptcy case.

Protect Your Digital Assets with a Cryptocurrency Lawyer

Crypto investors are savvy and well-versed in all matters of cryptocurrency. However, bankruptcy is another story altogether. Some of the smartest lawyers in the country have been spending full time addressing the highly technical, unique, and brand-new issues that have arisen in these novel cryptocurrency bankruptcy cases. And as is frequently the case, the creditors, especially the individual creditors, are left blowing in the wind. 

Yes, there are creditors’ committees representing the interests of unsecured creditors. But you want to be sure that your own individual interests are being represented and protected as well. For the most part, your cryptocurrency has not been stolen, but it has been mishandled. Undoubtedly, this will end up costing you dearly.

If you’ve invested in cryptocurrency and the crypto is held in an exchange in bankruptcy, hire an attorney who is versed in Chapter 11 bankruptcy and cryptocurrency to represent your interests and recover your losses.

At Lakelaw, we represent you fearlessly and zealously. Contact us today to schedule a free confidential consultation.