Oklahoma bankruptcy court sees record number of filings

Journal Record, The (Oklahoma City), Jan 16, 2004 by Heidi R. Centrella

A combination of credit cards, medical bills, divorce, the economy and obesity received the blame for a record number of bankruptcy filings in 2003 in the U.S. Bankruptcy Court for the Western District of Oklahoma.

Filings for the year totaled 14,213, up 9.6 percent from 12,968 in 2002. Filings were also up from 13,239 in 2001, the previous record high for the court, and 10,526 for 2000.

Grant Price, bankruptcy court clerk for the Western District of Oklahoma, said it's not just Oklahoma. This is a nationwide trend. The people filing in Oklahoma, however, simply have no assets, he said.

We don't have that many businesses and reorganizations, he said. For the most part, the people who are filing bankruptcy are just broke.

One local trend he has noticed is that over the last few years, the numbers have been up and down. But each time they go down, it's not quite as low as the previous years.

It's been a gradual incline, Price said.

Win Holbrook, member of the 10-member panel of trustees for the bankruptcy court in the Western District of Oklahoma, has been a bankruptcy attorney for individuals and businesses since 1985.

While he agrees that the increase in filings certainly is a national trend, what he sees locally is credit card debt.

But then I think you have to go beyond that and ask 'Why do people have credit card debt?' I think a lot of people have credit card debt because they may have been furloughed from their jobs or they may have lost their jobs, Holbrook said.

The state furloughed a lot of people, and there have been quite a few state employees who have had to file bankruptcy.

According to Holbrook, most people live paycheck-to-paycheck, and when there's a hiccup in their income, they resort to credit cards to pay living expenses. They get behind again, and the cycle continues.

In addition to losing jobs, many people also have high medical bills due to a lack of or poor health insurance coverage.

Again, these are people who don't make a lot of money for the most part, he said. Obesity, he said, also can factor in to the equation. What with statistics showing how Americans are, in general, getting fatter and fatter - and Oklahoma is no exception - obesity is proven to pose greater health risks. And with more health problems, people face higher medical bills, Holbrook said.

I think you can read the newspaper on a daily basis and see the ills that are affecting society in general, he said.

There's certainly no one thing. Although there are examples of people abusing credit card debt, but I don't think that's the reason people are filing for bankruptcy.

While Congress had been working on a measure to make it more difficult for people to file for bankruptcy, Holbrook said 9-11 slowed everything down.

They're more concerned with terrorists right now. After 9-11, then Enron, WorldCom and those other big bankruptcies, I think Congress just realized there are more important things on their plate to deal with than these poor people who are filing bankruptcy and to make it harder for them - the people who are already struggling.

For 2003, filings for the Western District of Oklahoma were up for 10 months from the same months in 2002. The only months in 2003 with lower filings than 2002 were April and November.

Filings in December totaled 1,059, up 15.5 percent from 917 for December 2002.