This matter is before the Court on bank, VCB’s, Motion to Dismiss Case for Abuse and Debtor’s Response thereto. Creditor VCB contends that Debtor’s chapter 7 case is abusive and should be dismissed under § 707(b)(1). Debtor concedes that the presumption of abuse arises under § 707(b)(2)(A), but she argues that her ineligibility for chapter 11 or 13 (because she is a “stockbroker”) and her future financial outlook are “special circumstances” that rebut the presumption. The Court held an evidentiary hearing on July 18, 2017, and, having reviewed the record and being otherwise sufficiently advised, makes the following findings of facts and conclusions of law.
Debtor has worked in the financial industry for fourteen years and holds series 6, 7, 63, and 66 financial securities licenses, as well as life and health insurance licenses. Fidelity Investments (“Fidelity”) has employed Debtor for over six years. Fidelity provides Debtor with office space, a computer, and a telephone line at no cost to her. She typically works at Fidelity’s office during its office hours, Monday through Friday from 8:30 a.m. to 5:00 p.m.
Fidelity has approximately 45,000 employees, 55 of whom have the same job title and compensation structure as Debtor. As part of her job at Fidelity, Debtor provides financial advice to clients and solicits them to make investments. Clients reach Debtor by calling her direct telephone line and extension at Fidelity or by meeting with her in person. Based on their interactions with Debtor, clients make financial decisions such as whether to keep stock investments, create additional income through an annuity, or purchase life insurance. Debtor interacts with an average of five to six clients each work day and has approximately 1,000 clients in total, some of whom have worked with Debtor for a significant time.
Fidelity owns Debtor’s client list and does not permit Debtor to freelance or otherwise work for herself. Debtor does not provide financial management, investment, or other professional services to any clients, other than in the course of her work for Fidelity. Although Debtor has access to all clients’ accounts, they are legally titled to the client, individually, and/or to Fidelity. Debtor holds no clients’ funds in her personal bank accounts.
Other than child and/or spousal support, Debtor receives all of her income from Fidelity. Fidelity sets Debtor’s annual salary of $60,000 and allows her to earn paid vacation and sick leave. Debtor is also eligible to earn commission pay from Fidelity based on the dollar amount of financial products in which her clients invest. Debtor’s goal is to generate $14 million in investment transactions in her clients’ Fidelity accounts per month. Debtor earns a certain commission if she meets 100% of her goal, and she earns a higher commission if she meets 130% of her goal. Debtor has earned a commission from Fidelity every year since she became eligible in November 2013. Her gross annual income has not been less than approximately $110,000 since 2014. Her 2017 gross income totaled $76,213.89 as of her June 16, 2017 pay date, which was the twelfth of twenty-six paychecks that Debtor anticipates receiving this year. Debtor received tax refunds of over $6,000 each year for calendar years 2014, 2015, and 2016.
Debtor filed her chapter 7 petition on November 28, 2016 (“Petition Date”). Debtor’s scheduled secured and unsecured debts total $345,000 and $313,932.85, respectively. Debtor’s petition states that her debts are primarily consumer debts and that she is not a sole proprietor of any business, including a stockbroker business as defined in § 101(53A). Debtor’s Schedule I states that she is employed as an “investment consult [sic] / stockbroker” by Fidelity. [ECF No. 1, p. 28.]
Debtor voluntarily reported her bankruptcy filing to the Financial Industry Regulatory Authority, which listed Debtor’s bankruptcy on her individual “BrokerCheck Report.” Fidelity is listed as Debtor’s employer on the BrokerCheck report, and Debtor asserts that Fidelity is monitoring her bankruptcy.
Debtor filed a Chapter 7 Statement of Current Monthly Income (Official Form 122A-1) and Chapter 7 Means Test Calculation (Official Form 122A-2) [ECF No. 11 (“Means Test”)]. Debtor and VCB accurately stipulated as follows regarding Debtor’s Means Test:
6. The annualized current monthly income of the Debtor exceeds the median family income in Kentucky for a family size of two. Specifically, line 12a of Official Form 122A-1 as filed with this Court by the Debtor reflects her “current monthly income” as being $9,570.83 (see ECF No. 11 at pg. 2). Debtor’s annual income pursuant to line 12b of this form is $114,849.96.
7. Annual median family income for Debtor’s state and household size of two at the time of the filing of the bankruptcy petition was $50,882.00.
8. Official Form 122A-2, as filed by the Debtor, confirms that a presumption of abuse arises in the Debtor’s pursuit of a discharge under Chapter 7 of the Bankruptcy Code and as specifically stated in 11 U.S.C. §707(b)(2).
9. Based upon the Debtor’s calculations in Official Form 122A-2 that she filed with this Court, Debtor’s monthly disposable income is $1,785.44 (see line 39c of such form and ECF No. 11 at pg. 10).
[ECF No. 38, ¶¶ 6-9.] Debtor answered “No” to the Means Test inquiry: “Do you have any special circumstances that justify additional expenses or adjustments of current monthly income for which there is no reasonable alternative? 11 U.S.C. §707(b)(2)(B).” [Means Test, ¶ 43.]
The Chapter 7 Trustee filed a Notice of Sufficient Assets, indicating that the payment of a dividend to creditors may be possible and setting a deadline for filing claims. The Trustee informed Debtor that certain funds she has on deposit, as well as her 2016 tax refund, are subject to turnover.