DETROIT, MI – The U.S. Trustee Program (USTP) has secured a $392,471 judgment and a three-year suspension against Recovery Law Group APC (RLG), a national consumer bankruptcy law firm, for making false and misleading disclosures in more than 200 bankruptcy filings.
On Sept. 17, the U.S. Bankruptcy Court for the Eastern District of Michigan granted summary judgment against RLG, finding that the firm knowingly violated provisions of the Bankruptcy Code and Rules regarding attorney compensation disclosures and debt relief agency conduct. The court cited 220 cases since 2020 in which RLG failed to properly disclose its role or fee-sharing arrangements with contracted attorneys.
The enforcement action stemmed from a case involving a senior couple who retained RLG for $1,835. The firm assigned a Michigan-based attorney, Sheena Majors, who failed to disclose RLG’s involvement in court filings. Due to multiple failures by both RLG and Majors—including the attorney’s absence at a critical hearing—the couple lost their home and significant home equity. A related malpractice suit is pending, with liability already established and damages yet to be determined.
“Transparency and robust disclosure are essential in bankruptcy,” said Acting Director Ramona D. Elliott of the Executive Office for U.S. Trustees. “Professionals threaten the integrity of the system when they are opaque about their payment arrangements, misrepresent their services, and fail to help their vulnerable clients.”
This marks the second enforcement action against RLG in 2025. In April, the U.S. Bankruptcy Court for the Eastern District of Virginia held RLG and affiliated attorney Thomas Watson in contempt for violating court orders and providing deficient legal services. The court ordered $48,000 in sanctions, required fee refunds, suspended the firm for two years in that district, and disbarred Watson from practice there.
The U.S. Trustee Program operates across 21 regions with 88 field offices and an Executive Office in Washington, D.C., overseeing the integrity of the nation’s bankruptcy system.
