Consumer Payment Card News

Bankruptcy Reform

The House Judiciary Committee is holding a hearing today on bankruptcy reform as Chairman James Sensenbrenner (R-Wis.) has introduced a new version of the legislation. This will be the first hearing on bankruptcy reform this year, since the House voted down the legislation last year. Bankruptcy reform bills were first introduced in Congress six years ago. In mid-November 2002, the House rejected the bill by a vote of 172-243. The revised version is expected to omit the “Schumer Admendment” which dealt with the dischargeability of debts related to abortion clinic protests. Meanwhile, the National Retail Federation praised the reintroduction of bankruptcy reform legislation. The NRF noted that bankruptcy filings reached a record high of more than 1.5 million last year, and one in every seven American households will have filed for bankruptcy in the next decade if the rate of increase continues. NRF sent a letter to Sensenbrenner thanking him for reintroducing the bill and another to all House members urging them to co-sponsor the measure. Under the proposed legislation, consumers who have the ability to pay some of their debts will be forced into a Chapter 13 filing rather than filing for full liquidation under a Chapter 7 filing.

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