Have any of you seen this? I filed a chapter 7 for a client with about
$14,000 in her account, which was scheduled and exempted, but they locked
the client out of her account until the chapter 7 trustee advised them of
his intention regarding the funds. The trustee is going to abandon the
funds, but it's taken over 30 days to get this resolved, during which time
the debtor hasn't had access to her money. I wish I'd heard of this before.

Wells Fargo is doing this nationally. It is, IMO, borderline permissible.
Wells Fargo is attempting to avoid a claim by the Trustee that it improperly
and prematurely released funds that might be the property of the bankruptcy
estate.

In 99.9% of cases, they aren't, but that never prevented someone from
guarding against that .1% possibility.

Brett Weiss
lawyer@brettweiss.com
www.brettweiss.com

Maryland, DC and Federal bars
Member, National Association of Consumer Bankruptcy Attorneys

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"JoblessDave" <JoblessDave@notlisted.us> wrote in message
news:1%Sdf.39$Xd6.30@fed1read06... Have any of you seen this? I filed a chapter 7 for a client with about $14,000 in her account, which was scheduled and exempted, but they locked the client out of her account until the chapter 7 trustee advised them of his intention regarding the funds. The trustee is going to abandon the funds, but it's taken over 30 days to get this resolved, during which time the debtor hasn't had access to her money. I wish I'd heard of this before.

"Brett Weiss" <lawyer@brettweiss.com> wrote in message
news:_sqdnURTK5MwqOTeRVn-vg@giganews.com... Wells Fargo is doing this nationally. It is, IMO, borderline permissible. Wells Fargo is attempting to avoid a claim by the Trustee that it improperly and prematurely released funds that might be the property of the bankruptcy estate.

Wells Fargo's letter states that they are "required by Sections 541 and 542
of the Bankruptcy Code to act in good faith to preserve the status quo and
so must follow the trustee's direction with regard to the Estate Funds."
But section 542 provides that an entity, other than a custoidan, in
possession of property that the debtor may exempt, *shall deliver* to the
trustee, and account for, such property.

When I wrote my post the Trustee had promised me an abandonment. That was
days ago, and I still haven't seen it filed. I know I'll have a remedy 30
days after the conclusion of the meeting of creditors, but I don't see a way
to expidite the Trustee's action. I wonder how Wells Fargo or the Trustee
would respond to a demand that funds be *delivered* to the trustee?