Bankers, Businesses Back Bankruptcy Bill
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Supporters of a federal bankruptcy reform bill say the plan’s tougher regulations would apply only to people who make more than the median income in their state, allowing low-income earners free to declare themselves broke. “The bill keeps the courthouse door open, but also holds people accountable for their debts,” said Laura Fisher, spokeswoman for the American Bankers Association (search). “It eliminates some abuse in the system.” But critics point out that the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (search) — which could get a final vote in the U.S. Senate this week — is not intended to protect lower-end economic groups either. “Consumers are not out there lobbying Congress to obtain more favorable treatment for consumers,” said Paul Sweeney, partner at Linowes and Blocher in Bethesda,Md. “You have very well-financed credit card companies pushing to have this legislation passed.” In any case, many businesses and consumers agree that the bankruptcy bill, which has been a top legislative priority of banks and credit card companies for several years, will likely pass this time. |