Legal Question in Bankruptcy in California
Gaming Debts
Several months ago, I found an enjoyable past time:
GAMBLIING ON THE INTERNET! This enjoyable past time
became an addiction within a very short period. Gaming
debts on several visa and mastercards approach
$80,000. With a fixed income of about $2,400 monthly,
it will be impossible for me to meet my monthly
obligations. After retaining an impeccable credit
rating throughout my life , I have concluded that
filing for bankruptcy is my only choice. Does the fact
that the money was used for gambling have any effect
on the bankruptcy? It recently came to my attention
that internet gaming is illegal within the State of
California. I have 2 unanswerable questions: (1) How
was I able to loose
control, but more important :(2) How could financial
institutions which offer visa and mastercard advance
funds to customers knowing its intended use is illegal
within the state which they preside? I have spoken
with others on the intenet whose situation is
identical to mine. They also will be filing for
bankruptcy. Is bankruptcy our only available choice
for debt relief?
2 Answers from Attorneys
Re: Gaming Debts
Well, bankruptcy is the only actual debt relief method, other than repaying your debts, that I know of. As for your other two questions, I am assuming they are largely rhetorical.
Perhaps more important is the fact that you are going to have a real battle on your hands filing bankruptcy, particularly Chapter 7. You will have to prove that you intended or had the reasonable expectation of being able to repay the debts you incurred to each creditor. While gambling debts are not automatically non-dischargeable, it raises significant questions about your intentions and ability to repay, particularly when it happens in a short period of time, as it did in your case.
Your best bet will probably be to try a Ch. 13 case, but even there you face possible objections on other grounds.
I suggest that you consult with a competent bankruptcy attorney in your area regarding your options.
Re: Gaming Debts
You have the option of paying the debts. More importantly, the credit card companies may argue that at the time you charged these bets, that you knew you would be unable to repay them, and therefore the bankruptcy court should hold them non-dischargeable!
Had you won, would you have returned the winnings once you learned that gambling was illegal? It is not the credit card companies' fault that you used the funds for such purposes.
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