(a) A
debt relief agency shall
not—
(1) fail to perform
any service that such agency informed an
assisted person or prospective
assisted person it would
provide in connection with a case or proceeding under this
title;
(2) make any statement,
or counsel or advise any
assisted person or prospective
assisted person to make
a statement in a document filed in a case or proceeding
under this title, that is untrue
and
or
misleading, or that upon the
exercise of reasonable care, should have been known by
such agency to be untrue or misleading;
(3) misrepresent to
any
assisted person or prospective
assisted person, directly
or indirectly, affirmatively or by material omission, with
respect to—
(A) the services that
such agency will provide to such
person;
or
(B) the benefits and
risks that may result if such
person
becomes a
debtor in a case under
this title; or
(4) advise an
assisted person or prospective
assisted person to incur
more
debt in contemplation
of such
person
filing a case under this title or to pay an
attorney or
bankruptcy petition preparer
a
fee or charge for services performed as part of preparing
for or representing a
debtor in a case under
this title.
(b) Any waiver by any
assisted person of any
protection or right provided under this section shall not
be enforceable against the
debtor by any Federal or
State
court or any other
person,
but may be enforced against a
debt relief agency.
(c)(1) Any contract
for
bankruptcy assistance between
a
debt relief agency and
an
assisted person that does
not comply with the material requirements of this section,
section
527, or section
528 shall be void and
may not be enforced by
any Federal or
State
court or by any other
person,
other than such
assisted person.
(2) Any
debt relief agency shall
be liable to an
assisted person in the
amount of any fees or charges in connection with providing
bankruptcy assistance to
such
person
that such
debt relief agency has
received, for actual damages, and for reasonable attorneys’
fees and costs if such agency is found,
after notice and a hearing,
to have—
(A) intentionally or
negligently failed to comply with any provision of this
section, section
527, or section
528 with respect to a case
or proceeding under this title for such
assisted person;
(B) provided
bankruptcy assistance to
an
assisted person in a case
or proceeding under this title that is dismissed or converted
to a case under another chapter of this title because of
such agency’s intentional or negligent failure to file any
required document including those specified in section
521; or
(C) intentionally or
negligently disregarded the material requirements of this
title or the Federal Rules of Bankruptcy Procedure applicable
to such agency.
(3) In addition to
such other remedies as are provided under
State
law, whenever the chief law enforcement officer of a
State,
or an official or agency designated by a
State,
has reason to believe that any
person
has violated or is violating this section, the
State—
(A) may bring an action
to enjoin such violation;
(B) may bring an action
on behalf of its residents to recover the actual damages
of
assisted persons arising
from such violation, including any liability under paragraph
(2); and
(C) in the case of
any successful action under subparagraph
(A) or
(B), shall be awarded the
costs of the action and reasonable attorneys’ fees as determined
by the court.
(4) The district courts
of the United States for districts located in the
State
shall have concurrent jurisdiction of any action under subparagraph
(A) or
(B) of paragraph
(3).
(5) Notwithstanding
any other provision of Federal law and in addition to any
other remedy provided under Federal or
State
law, if the court, on its own motion or on the motion of
the
United States trustee or
the
debtor, finds that a
person
intentionally violated this section, or engaged in a clear
and consistent pattern or practice of violating this section,
the court may—
(A) enjoin the violation
of such section; or
(B) impose an appropriate
civil penalty against such
person.
(d) No provision of
this section, section
527, or section
528 shall—
(1) annul, alter, affect,
or exempt any
person
subject to such sections from complying with any law of
any
State
except to the extent that such law is inconsistent with
those sections, and then only to the extent of the inconsistency;
or
(2) be deemed to limit
or curtail the authority or ability—
(A) of a
State
or subdivision or instrumentality thereof, to determine
and enforce qualifications for the practice of law under
the laws of that
State;
or
(B) of a Federal court
to determine and enforce the qualifications for the practice
of law before that court.
(Added Pub. L.
109-8, Title II, Subtitle C, §
227(a), April 20, 2005, 119 Stat. 67; Pub. L.
111-327, § 2(a)(20), Dec. 22, 2010, 124 Stat.
3560.)
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