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Thousands of companies, large and small, offer document preparation
services for Chapter 7 bankruptcy forms. These legal help and assistance
companies are however highly regulated by federal law. They cannot
provide legal advice. Any person offering legal advice without approval
of the State Bar commits barratry, according to many state states.
Barratry is defined as illegally practicing law without a license, and
may result in fines, penalties, in certain circumstances,
incarceration.
In recent years, many legal help companies transgressed the law,
advising clients which chapters to file and offering suggestions to
legal questions. The Chapter 7 bankruptcy rules are specific: any person
offering legal advice to a specific individual may be subject to
prosecution, where as general statements of law made publicly available
to all people are not considered legal advice.
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