(credit: Dan Boyle)

A federal judge in Minnesota has ordered one of the men behind the notorious Prenda Law group to liquidate his assets. Paul Hansmeier must now sell his condominium, among other assets, in order to pay back $2.5 million of debts more quickly rather than having the case drag out for years.

"Here, the debtor has a pattern and practice of dishonesty with the courts," US Bankruptcy Judge Kathleen Sanberg said during the Thursday hearing. She ordered Hansmeier to convert his Chapter 13 (wage earner's plan) bankruptcy filing to a Chapter 7 (liquidation). Under Chapter 13, Hansmeier could have paid his creditors much more slowly.

"This case was designed for one purpose only, to thwart the collection efforts of debtors," the judge added. "It was not because the debtor now wants to pay creditors in full."

Read 3 remaining paragraphs | Comments