February 8, 2023

Volume XIII, Number 39

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February 07, 2023

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February 06, 2023

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Consumer Advocate Appointed New Director of Justice Department’s U.S. Trustee Program

The Director of the Justice Department’s U.S. Trustee Program (USTP), which oversees the administration of bankruptcy cases, is about to change for the first time in nearly 20 years. Clifford White will be stepping down from the role and consumer advocate Tara Twomey will be taking up the mantle. In a recent press announcement, Attorney General Merrick B. Garland noted that the USTP “plays a critical role in ensuring the fairness of the bankruptcy process — including by providing impartial oversight and protecting consumer debtors from fraud and abuse.” Garland said, “I am confident that Ms. Twomey’s leadership will advance USTP’s mission to promote the integrity and efficiency of the bankruptcy system for debtors, creditors, and the public.”

Twomey has extensive bankruptcy and consumer credit experience. She currently serves as the executive director for the National Consumer Bankruptcy Rights Center, an “organization dedicated to protecting the integrity of the bankruptcy system and preserving the rights of consumer bankruptcy debtors.” She is also Of Counsel to the National Consumer Law Center (NCLC), which “works across a number of issues facing consumers to stop exploitative practices, help financially stressed families build and retain wealth, and advance economic fairness.” Twomey has authored several books and articles on bankruptcy law and practice and is a contributing author of several books published by the NCLC, including Foreclosures: Defenses, Workouts and Mortgage Servicing. In 2019, she also was appointed as the Special Consumer Counsel to the Official Committee of Consumer Creditors in the Chapter 11 cases of Ditech Holding Corporation and its affiliates. In that role, she evaluates the consumer claims arising from Ditech’s servicing practices and makes determinations as to which claims will be paid out of the $10 million claim fund. In addition, she was appointed by Chief Justice Roberts to the Judicial Conference Advisory Committee on Bankruptcy Rules in 2021.

Twomey’s appointment likely signals increased focus and scrutiny on creditor practices in bankruptcy cases at a time when bankruptcies may be on the rise again. The USTP serves to provide impartial oversight in the bankruptcy process, as well as protect consumer debtors from fraud and abuse. Since 2015, the USTP has entered into multiple national settlements with various mortgage servicing companies regarding improper bankruptcy practices and filings, particularly in Chapter 13 cases. Under Twomey’s leadership, the USTP is likely to continue prioritizing proper handling of consumer debtors’ mortgage claims in bankruptcy.

© 2023 Bradley Arant Boult Cummings LLPNational Law Review, Volume XIII, Number 25
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About this Author

Christy Hancock Financial Services Lawyer Bradley
Partner

Christy Hancock’s practice is dedicated to financial services regulatory compliance and litigation. Her work with mortgage servicing and financial institution clients has given her a broad base of knowledge regarding laws affecting the mortgage servicing business, including bankruptcy and foreclosure best practices, payment application, correspondence requirements, allowable fees, loan modifications, escrow requirements, and property preservation. In recent years, the majority of her practice has focused on advising large financial institutions on bankruptcy-related...

704.338.6005
Alex Dugan Bradley Lawyer Mortgage Servicing
Partner

Alex Dugan regularly represents financial services and mortgage company clients with compliance matters, including risk management and remediation, state investigations, regulatory compliance, and operational implementation of legal guidelines. Alex’s practice focuses on the bankruptcy compliance and regulatory concerns that her clients face. She is also a member of the firm's Auto Finance and Payment Systems industry teams.

With this experience and perspective, Alex provides daily guidance to clients on bankruptcy-related regulatory and compliance matters, supervises large-scale...

615.252.4638
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