Bankruptcy Petition Preparer Sentenced to Two Years Prison for Contempt of Court
Baltimore, Maryland - U.S. District Judge Catherine C. Blake sentenced Jerry Thomas, age 36, of Bowie, Maryland, yesterday to two years in prison followed by three years of supervised release for contempt of court, after he continued to act as a bankruptcy petition preparer in violation of a U.S. Bankruptcy Court order.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Richard A. McFeely of the Federal Bureau of Investigation; and the United States Trustee’s Office (the Department of Justice agency that supervises bankruptcy cases and trustees).
According to Thomas’ guilty plea, on November 5, 2007, the United States Bankruptcy Court for the District of Maryland issued an injunction specifically ordering Thomas to stop acting as a bankruptcy petition preparer. Thomas had previously been ordered to stop acting as a bankruptcy petition preparer by a United States Bankruptcy Judge in Washington, D.C.
According to the statement of facts, on April 30, 2008, Thomas filed a bankruptcy case in violation of the injunction, in U.S. courthouse in Baltimore. The Assistant U.S. Trustee in Baltimore saw Thomas and personally served him with a copy of the injunction specifically ordering that he not act as a bankruptcy petition preparer. In addition, the Assistant U.S. Trustee explained the terms of the injunction to Thomas. Thomas assured the Assistant U.S. Trustee that he understood the terms of the injunction and that he would stop preparing and filing bankruptcy cases for others.
Instead, Thomas admitted that the next day, May 1, 2008, he prepared a bankruptcy petition for another client and directed the client to file the bankruptcy petition with the Court, instead of entering the courthouse himself. Thereafter, Thomas employed that client to solicit customers through mass marketing and to file bankruptcy documents on behalf of others in the federal courthouse, paying the client $40.00 per petition.
On June 23, 2008, in response to a flyer delivered by Thomas’ client, a woman contacted Thomas. The woman and her son jointly owned a home that was in foreclosure and was scheduled to be auctioned on June 25, 2008. Thomas assured her that he could stop the foreclosure by filing bankruptcy documents and requested a $500 payment. The woman pawned her family jewelry to get the money to pay Thomas. Thomas prepared a bankruptcy petition and drove the woman to the courthouse on June 25, 2008. Thomas told the woman that he could not go into the courthouse because he had to wait for another client. The woman attempted to file the documents prepared by Thomas, but the clerk refused because the woman already had a pending bankruptcy proceeding. The woman went back to Thomas, who was in his car outside the courthouse. Thomas prepared new documents using the son’s name and advised the woman to sign her son's name to the bankruptcy petition. After complying with Thomas' instructions, the woman attempted to file the new documents. The clerk again refused to accept the documents and contacted the U.S. Trustee's office. The Assistant U.S. Trustee attempted to confront Thomas outside the courthouse, but he left the area. The woman’s home was sold at auction later the same day.
Further investigation revealed that Thomas filed and caused to be filed approximately 15 additional bankruptcy cases and that a number of his victims were vulnerable victims as their residences were undergoing foreclosure. Due to the fraudulent and false filings, those victims lost their residences as well as the fees paid to Thomas. The amount of money paid in fees to Mr. Thomas was approximately $58,850.
United States Attorney Rod J. Rosenstein commended Assistant United States Attorney Bonnie S. Greenberg, who prosecuted the case.