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  1. #1
    Join Date
    Feb 2013
    Posts
    1

    Angry Class-Action Settlement and Bankruptcy

    My question involves bankruptcy in the state of: California

    I received a letter from Discover Card stating that I was due a refund for Protection Product Enrollment. They recently entered into an agreement with the FDIC. The refund check was supposed to be sent no later than Feb. 21, 2013. When the check did not arrive, I contacted Discover and they stated that the refund had been applied to a "charge-off" on a closed Discover card account. I filed Chapter 7 Bankruptcy 7 years ago and my Discover card debt was "discharged" by the Court. It was not a "charge-off." How can my settlement refund money for Discover card fraud be refunded to Discover? I'm the individual that was harmed by the fraud and I am to be made whole by the refund. Also, aren't bankruptcies discharged debt as opposed to a charge-off? Please advise as I feel victimized even more.

  2. #2
    Join Date
    Sep 2010
    Location
    Florida
    Posts
    153

    Default Re: Class-Action Settlement and Bankruptcy

    Discharged debts in a bankruptcy are considered a charge off by the creditor. It is primarily an accounting term businesses use to clear their books, if you will. The creditor is the one who was not made whole because of the bankruptcy. I cannot speak to any legalities of getting a refund back but I highly doubt it.

    hth to at least understand a charge off.

  3. #3
    Join Date
    Sep 2010
    Posts
    478

    Default Re: Class-Action Settlement and Bankruptcy

    I would agree that the application of the settlement payment to a discharged debt may very well be a violation of the Discharge Order, however, unless you are talking about a large amount of money, let it go. My guess is the amount was under $200. It will cost you thousands to litigate this issue and any attny you hire (and you will need one) is not going to take such litigation (in the bk court for a violation of the discharge) on a contingency basis.


    Edt to add: One more thing. . . chances are the settlement payment would have been an asset of the bk estate. If so, it belongs to the Trustee, not you, unless you could have found an exemption to protect it or the Trustee deemed it of inconsequential value and "abandoned" it.

    Des.

  4. #4
    Join Date
    Sep 2010
    Location
    Florida
    Posts
    153

    Default Re: Class-Action Settlement and Bankruptcy

    Hey Des!

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