By JASON BOOTH
Staff Reporter
Faced with a doubling in the number of bankruptcy filings and a resulting rise in related fraud, Attorney General Janet Reno last week appointed Maureen Tighe as United States Trustee for the Central District of California.
In her new capacity, Tighe will oversee the administration of all bankruptcy cases in the six-country district that is centered in Los Angeles.
Since 1988, Tighe has been the leading bankruptcy prosecutor in the Los Angeles office of the United States Attorney. Since 1995, she has also served as deputy chief of the department’s major fraud section.
Tighe becomes the local district’s U.S. Trustee at a challenging time.
The Central District has long been the bankruptcy capital of the United States. Almost 100,000 personal bankruptcies were filed in the district last year, about 10 percent of the national total.
The Los Angeles Business Journal reported last week that federal officials believe up to 15 percent of those filings are fraudulent.
However, there has been little or no increase in resources dedicated to processing bankruptcy cases and investigating fraud. As a result, there have never been more than 30 bankruptcy fraud indictments handed down in the Central District in any given year.
Tighe and other officials dealing with local bankruptcies said the proportionately low level of prosecutions is due directly to the lack of resources in the district.
Tighe does not anticipate a rise in bankruptcy fraud prosecutions in the wake of her appointment as U.S. Trustee unless more resources are committed to the fight.
“It is a time of cutbacks. We will try to do more, but I don’t want to speculate under the current climate,” she said.
Kevyn Orr, deputy director of the Executive Office for the U.S. Trustees in Washington, D.C., which selected Tighe for her new position, said his office recently made the largest-ever request to the Department of Justice for additional staff to administer bankruptcies nationwide.
Both he and Tighe, however, admitted that previous requests for additional resources have gone largely unheeded.
Tighe said she is not counting on receiving any additional staff and would instead focus on increasing the efficiency of the system.
“The system is overburdened, so we need to be more innovative and creative in the way we face challenges,” she said.
A key part of that process will be to review the types of documentation required and procedures followed by those filing for bankruptcy, she said. At the same time, she wants to make the system more accessible to non-English speakers, who comprise an increasing percentage of the local bankruptcy-filing population.
“You are seeing more and more people who can’t even answer questions at their meeting with the trustees,” Tighe said.
Tighe’s appointment fills a vacancy created in September when former U.S. Trustee Marcy Tiffany resigned to become general counsel for Hughes Electronics Corp.
