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Change our bankruptcy laws

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Hi,

INTRO

I thought I would start an online journal about my journey to change our bankruptcy laws, and to end collective corporate bullying of people who are in financial hardship, poverty or who are bankrupt like me.

As a bankrupt myself it was truely a shock to learn the truth about what it really means to be in debt in NZ.

So I've set upon a mission to change our laws. I believe if I knew the real truth about debt in NZ I would have long ago carved out a more prosporous life for myself.

I hope readers, you get some value out of my journey to change our laws. I hope its not too late for you to turn away from debt and towards a better future.

The world of debt in NZ is very complex. Its like a giant puzzle made up of many pieces of all shapes and sizes.  This journal will be an attempt to put all the pieces together. In the end, we will all see the real picture.

It was a shock to discover that the debt collection industry in NZ is also corrupt. The place to fix that is to change our laws. There is a tremendous incentive for lending agencies and government to keep people in debt. They work hand in hand through the unregulated debt collection industries, governments and corporations, to move our money out to the international stock markets.

THE ULTIMATE GOAL

1. To change our laws in order to end collective corporate bullying and discrimination against people who are in financial hardship, poverty and those who have formal insolvency procedures against them.

THE JOURNEY

The journey for me, began 4 years ago when I decided to do something about the debt that I was in. I am bankrupt today because I was unsuccessful in that mission. Thousands are bankrupt in NZ every year. Most are due to creditors bankrupting them through the High Courts like I was. But this journey is not about my story. Its about the steps I am taking to have our laws changed in NZ, so we can take charge of our own lives and live the way we chose without the burden of debt ruining our lives. Being in financial hardship and bankrupt, a lot of our legal and privacy rights are taken away from us. 

Up to this point in time I have researched, spoken to MP's, community groups and individuals in an effort to understand just how are rights are being violated by the debt collection industry and why we have such very harsh cruel insolvency laws that stand in contrast to our governments values and to even our written laws. Just a few of the pieces of the puzzle starting to fit together. To change our laws will be done just small steps at a time.

CONTINUING THE JOURNEY

As I've gathered evidence, I'm identifying first what laws that are actually harming people who are bankrupt. That is its easier to see that from my current position. Then I'll create a sort of demographic of different areas and what laws need to be changed. When I became bankrupt, the first thing I was made aware of, was that people in NZ don't actually have a right to hold a bank account in NZ. Banks in NZ do write to their customers and tell them to close their accounts when they become bankrupt. Thankfully most have allowed me to retain my accounts. There are also banks in NZ who will not accept new customers if they have defaults of any sort on their credit reports. As NZ Citizens we don't have an inherent right to hold a bank account in NZ, its up to the individual banks. The law to change is for bankrupts to be able to keep their transactional accounts open with the bank when they become bankrupt.

The other law to change is for people who are self employed to be able to continue working without the threat of imprisonment by the official assignee. Because I had no other source of income, I was forced to keep working for 5 weeks with that horrendous threat hanging over me. Eventually I did obtain consent to keep working in the same position I had been in for five years, so I could pay basic living costs. No person should have to be expected to live like that.

This week there is a meeting with the Green Party. They will be talking about poverty. I'm going to that meeting to see if I can find a link between debt and poverty.

I'll post into this journal every couple of weeks or so.

If anyone has any suggestions that will help this campaign, please put your suggestions forward.

 

Ford

 

 

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Guest

September 2017

Hi,

CONTINUING THE JOURNEY.

I went to the meeting of the Greens and asked my question about debt and poverty. Because their focus is towards low income and beneficiaries who are in poverty, debt is only in reference to WINZ debt. They mentioned one of the government child services I could enquire as to statistical data that they may or may not have. I might look into that later. Otherwise it appears that there will not be a lot of statisical data on how debt contibutes to poverty. I had already contacted the coronors office and they also do not keep stats on people who commit suicide because of debt. The labour party also said that they don't have policies on the level of detail I require.

I have prepared a draft viewpoint for publishing in the Canterbury Today magazine. Don't know if they will accept it, because not just anyone can submit articles. I had a meeting with a regular contributor to the the View Point and got some feedback on my draft.

After several months I finally received a letter from the Guardian Trust about Kiwisaver. And that was only because they first had ANZ contact me, which was a complete waste of time. Under the current laws there is no way to get out of Kiwisaver unless I emigrate to another country permanently or take it out at retirement. So there stays the government contribution with ANZ continuing to take their fees.

My company has now been struck off because I am bankrupt. There was no point in me spending the money to take the Companies Office to court to retain the company because only solicitors can represent a company in the High Court. It would have cost thousands to only be told by the Judge that a bankrupt cannot be a director.

I have received an application from WINZ for the accomodation suppliment. Before I was bankrupted I hadn't needed to apply for any benefits.

New debt. Received a timecost report from the Official Assignee and wow, 5 months into the bankruptcy and the new debt against me which started the day I became bankrupt is now more than $11,000! At the same rates, I estimate that by the end of the bankruptcy the OA would have clocked up around $60,000 in new debt. That is more than the entire creditor debt lodged in the bankruptcy against me. Case law I was reading showed another bankrupt had nearly $200,000 in new debt against them for bankruptcy administration over three years. Wow. When I meet with the MPs I will ask about that because there are nearly 2000 bankruptcies in NZ every year. The OA takes their fee first before any creditors, and if there is not enough to pay their costs then the tax payer pays it. Public money is used if there is no money that can be retrieved from a bankrupts estate.

They have now closed off the bankruptcy administration. To the bankrupt, that means nothing.  Here is part of the estate report  "........ability to pay contributions will be reassessed if her financial circumstances improve during the course of her bankruptcy..............." Remember people the OA has access to your bank accounts.

All bankruptcy means is that creditors cannot themselves collect on the debt from the debtor. They have to put a claim in the bankruptcy estate. But the debt still exists. Unless a creditor actually writes to you and tells you it has been written off. I am still paying original creditors outside of the bankruptcy regime, and I receive student loan statements from the IRD. I spoke to two IRD staff who told me that student loan debt actually "gets capitalised and put on to the new IRD number."  "Oh really" I asked. I'm waiting for that to be confirmed in writing but they have told me that mine will be written off. They also get a copy of the estate report that will show I do not have any assets. In the meantime I am paying them also and the balance is reducing. It will be interesting to see if they do write off the student loan now that the bankruptcy admin is closed by the OA.

Next mission - writing to the CEO of NZTA to see if they will stop the debt collector they used from holding any profile against me now that I am bankrupt. According to the debt collector themselves, they say they must retain records for auditing purposes. I asked them who audits them, given they are not regulated by any government. They chose not to respond.

I'll update again in Oct. If you think of anything about our laws that you would like changed in terms of debt collection and bankruptcy, please share it with us.

PS I managed to get myself on the mailing list for the NZ Debt Management office of the government treasury. They have put out the next bond tender schedule if anyone is interested.

 

Ford

 

 

 

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Have you approached any investigative reporters or the like? I'm sure someone would be keen to pick the story up and do an in-depth investigation into bankruptcy in NZ, especially when they see what the process looks like from the inside. First step towards changing legislation is to get people aware of it and talking about the need for change.

Edited by RichLife

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Guest

 

Hi, thank you for your questions. I have noted it.

The short answer is no I haven’t yet approached anyone. But that is not to say there won’t come a time when it will be right for an investigative reporter to look into our bankruptcy laws. I would like to have an article printed first to see how people respond to the issues that I will bring to the table. I still have much research to complete. I would like there to be a proper formal government enquiry, so our laws can be changed. Bankruptcy is a very taboo subject, people don’t like talking about it. It should be discussed of course because substantial public money goes into the very hidden bankruptcy regime. So not just any reporter would be suitable. For all the issues I have uncovered, and for my part in accepting debt offerings from the bank, and then being made bankrupt, I have been lucky to have people treat me with kindness. For them and the decent people of our country they deserve an investigation by someone who has integrity and who would not bias or manipulate the findings.

 

Edited by Guest

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On 9/30/2017 at 11:30 AM, Ford said:

 

Hi, thank you for your questions. I have noted it.

The short answer is no I haven’t yet approached anyone. But that is not to say there won’t come a time when it will be right for an investigative reporter to look into our bankruptcy laws. I would like to have an article printed first to see how people respond to the issues that I will bring to the table. I still have much research to complete. I would like there to be a proper formal government enquiry, so our laws can be changed. Bankruptcy is a very taboo subject, people don’t like talking about it. It should be discussed of course because substantial public money goes into the very hidden bankruptcy regime. So not just any reporter would be suitable. For all the issues I have uncovered, and for my part in accepting debt offerings from the bank, and then being made bankrupt, I have been lucky to have people treat me with kindness. For them and the decent people of our country they deserve an investigation by someone who has integrity and who would not bias or manipulate the findings.

 

It absolutely is a taboo subject which is why I think a reporter would be very keen to sink their teeth in. There are definitely some reputable journalists with the resources to do the topic justice - maybe the team who left Mediaworks for Fairfax after the current affairs show '3D' was axed (Toby Longbottom/Eugene Bingham/Paula Penfold), they investigated the NZ role in Afghanistan and turned up heaps of important stuff. Maybe an RNZ/John Campbell feature?

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Guest

Hi,

It seems it does hold some interest. I have been contacted today by a writer for a community newspaper, who wants to do a story. I don't know which paper and nothing is confirmed yet until we meet up in a few days, but its a promising start.

Thanks for the names. I'll make a note of those.

There is still much I can research, but I have already hit a couple of walls, and that is where contractural arrangements with debt collectors are entered into by the banks and government with debt collectors, contracts that we the public are not allowed access to. But that is where the answers lie, and I believe they may also lie with the Government's debt management office. Who ever investigates are going to have to have tremendous courage to unveil those secrets.

Ford

 

 

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Guest

October 2017

Hi

Progress so far. I have contacted the Auckland Council to ask about their bylaws. One of the members of the Birkenhead Residents Association is making public on his personal website the names and addresses of people who are bankrupt. A complaint to the guy resulted in him changing the coding on his website so now my name appears in bold font so it stands out. There is nothing the Auckland Council can do. I was hoping they could ask him to take down the insolvency pages, but no action was taken.  As part of my research, I will write to the residents of Birkenhead who appear on this man's website also and see if they will complete a survey.

I made a request to the Official Assignee for the entire contents of the estate file they hold against me. I have to wait 20 working days but hopefully it will fill in some gaps. I have spoken to the IRD to try and get information about the debt they sent through to the OA. The IRD's insolvency office is supposed to be calling me this week.

I've also been speaking to a company called Financial Services Complaints Ltd. (FSCL)  Baycorp is one of their members. But EC Credit Control is not. I asked what is the difference because to me they are just debt collectors. But there is a difference. A very significant one. The members of the FSCL are actually debt buyers. Debt buyers have to be part of an external disputes resolution scheme. They just might be able to tell me who in fact has legal right to the debt against me that Baycorp has tried to collect on. It was originally with ANZ then went to Collection House then on to Baycorp. This is part of the huge legal loophole that lets debt collectors harrass people and try to force them into contracts. As I understand it, debt has two parts, the debt equity which can be sold, or the entire contract can be sold so the debt collector then becomes the legal creditor.  ANZ's district court claim against my company, they were listed as the Plaintiff, not Baycorp. But as with the BNZ debt against me, the same lawyer can represent both the creditor and the debt collector, this occurs with Baycorp and ANZ as well. The solicitor who signed the court documents as solicitor for the plaintiff ANZ, turns out to be an in-house lawyer for Baycorp. The document server rang me up wanting me to meet him away from the property, rather than bringing the documents to the registered office of the company, which is what is the correct legal process. There are lots of pieces of deception like that, that I conclude that the reason for collector harrassment and there being any lack of supervision in the industry, is to force the debtor to enter into a contract with the debt collector. Because now the debt is outside of the banking regulations. That means any obligation between the original creditor and debtor ceases to exist. The rights that the debtor had agreed to wth the creditor under an original contract also cease to exist. So the debt collector is free to add any costs they like to the debt.

I actually received an email from Neighbourhood support head office warning that debt collectors have been contacting their co-ordinators trying to get information from them. This is a pure violation of privacy, but because of our laws, there is nothing stopping them from them doing so. Debt collectors also contact accountants as well, asking for contact information. Just like the member of the Birkenhead Residents Association making public our private information. This is just one reason why debt collectors need to be regulated.

Something else I found out about the banks relating to debt. Shadow banking. Anyone heard of it? Its a practice that Kiwibank use.

Thats all for now. I still have to write to the NZTA. Thats the next job.

And while I'm on the subject of privacy, please make sure you don't give out other people's private information to anyone, for any reason. I say, treat debt collectors the same as you would for any financial scammer. Debt collectors operate outside of our laws and are violating our rights. Yes some people do enter into agreements with debt collectors, but can you be sure that you do actually have a legal obligation to pay them. How do you know they are not adding collection costs and charging rates of interest that were never part of an original contract with the original creditor. Your legal obligation is to the original creditor, don't be tricked into agreeing to debt or repayments with a debt collector, because you will lose your legal rights, even to dispute the claims in court.

 

 

 

 

 

 

 

 

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Guest

I'll post this again. Something has gone wrong with the text

Journal updates

Update for December 2017

The bankruptcy story was to be published in the Senior community paper but after being in circulation for just a few months that paper is closing.

So I guess that will go on hold for awhile.

 

In the meantime other developments.

I requested a copy of my file that the OA holds against me. What a shock to find an email in amongst it. It seems that Mr Warwick Jones (insolvency watch) has been calling up the OA's office and asking about my personal life. Its really horrible being stalked by that man. I contacted the OA and they withheld my address on their insolvency register. I also contacted the DIA. I learned that the insolvency watch website picks up the listings from the NZ Gazette. This is the same person who I mentioned in the earlier post. There is something tremendously wrong with our government systems when a random person can ring the OA's office and discuss the private life of a bankrupt. Mr Jones is not even a creditor in the bankruptcy against me.

 

If I don't hear back from the DIA, I will try and get a restraining order. Cross your fingers for me that I can get legal aid.

 

The other information on the file held by the OA, is the threshold for the repayment of bankruptcy debt. For a single person it is just under $30,000.00 per year. I don't know if that is gross or net. But I suspect it is net. Repayments also have to be more than $20 per week. Also the OA writes to the banks and advises the banks should let them know if the bankrupt holds more than $1200 in the bank at any one time. I asked the OA if they could increase it to $5000 but again the laws prevent that. The bankrupt is only allowed to hold $1200 in a bank account for the purpose of maintenance. You cannot save any money towards emergencies or other living expenses when it exceeds that amount. Currently I only work parttime and have medical issues, which the OA knows about. I wanted to save enough so if I had to stop working due to ill health I would have enough money to pay my rent etc. But this is not allowed. I can't save any money either towards retirement. 

The only thing I can do is to withdraw excess money from my bank accounts.

 

The OA does take bankrupts to court to force them to pay them money if they are earning over the threshhold. 

I will try and find out more about the threshholds, apparently the information comes from WINZ.

Other information - the OA's trust account is with ANZ Bank

I read the Coalition agreement between Labour and NZ First, (the parts that were published) and in it is a sentence that states:-

"Investigate growing KiwiBank’s capital base and capabilities so that it is positioned to
become the Government’s Banker when that contract is next renewed"

Thats it for now.

I'll post again after xmas

 

Please don't get into debt this xmas. If you are in debt, then make it a rule to never file for any insolvency procedure. 

Bankruptcy and NAPs are made public for life. And you don't want Mr Warwick Jones asking the OA about your private life.

Its just not worth it, people. 

 

Ford

 

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Look up insolvency watch - bizarre that this guy has made a business out of charging subscribers for access to publicly available information. What is the govt rationale for making all of this information public in the first place?

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Guest

Hi,

I don't know the answer to that yet, but I will try and find out.

This is part of the reply from the NZ Gazette.

"We have recently reviewed our procedures and access to published information, and as a result we will not be restricting access to published Gazette notices online. The New Zealand Gazette is the journal of constitutional record, and blocking access to notices, whether they be current or historic, is inconsistent with its purpose of making information part of the public record. This includes access through search engines such as Google. The Gazette publishes notices provided by others and is not responsible for the insolvency process or the insolvency legislation. Notices must be published in accordance with relevant legislation which, as above, means notices will not be amended or removed from public availability. However, if there is a concern in regards to your safety, please send through evidence, for example a form or letter from a relevant agency, so we can consider your request. We would also need to liaise and get agreement with the Insolvency Office, who is responsible for the notice, for any potential changes."

there are different laws, like the insolvency act, that allow certain information to be made public.

That law was made in 2006 and the internet wasn't the same back then. Originally I think it was to give creditors some way of finding out if a person who was bankrupt tried to continue borrowing money or using the bankruptcy laws to get out of paying their debts. A lot of our laws are years out of date. NZ follows a lot of what other countries do, and the term "debtors prison" has been around for centuries. Bankruptcy is the modern version of it. Borrowing money and not paying it back is still a crime today. In law, it makes no difference whatsover as to the circumstances that the insolvency occured. The jails would not be able to hold all the people who default on debt so all they can do is to ensure that label stays with them for life and strip away our privacy and legal rights. Once a person becomes bankrupt the OA's job is to try and recover the money from the debtor. They then look for crime. They do a lot of work behind closed doors looking for evidence. The three year term is so the OA can use that timeframe to recover money from the debtor. Money is also the big driving factor, and the OA won't bring any claims to court if they cannot retrieve money from the debtor. In the insolvency act there is only one small section of law that absolves debtors from being prosecuted, and that is section 427 which states that the bankrupt must prove they had no intention to defraud creditors. Again the assumption of insolvency is that the debtor has committed a crime. That's why the penalties are so harsh and life long.

The Gazette is a journal of constitution, apparently. Well that constitutional record is violating our privacy, and making us more vulnerable to identity theft.

Even Veda's (Equifax) credit report passwords are not secure, that information can be obtained via the information that is made public on the insolvency office website.

Bankruptcy quite literally shows our laws do not consider the wellbeing and the rights of the people first. Because they do nothing to stop the corporate crime and corruption that runs rampant in our country. People who have formal insolvency procedures forced against them, become part of that corrupt system whether they like it or not. Our outdated laws have created serious legal loopholes that are being exploited.

The government is aware of what goes on. But when corporations are behind it they are slow to do anything about it.

All we can do ourselves is to educate each other about the truth, and keep campaiging to change our laws so we don't continue to be taken advantage of.

It takes two parties to create debt. I've worked in the accounting industry long enough to know that our lack of financial and legal knowledge is being severely exploited. We need to stand up and protect ourselves, because there is nothing that I have seen thus far, that leads me to believe that our government intends to even begin putting right the terrible injustices that continue to plague the good people of this country.

Ford

 

 

 

 

 

Edited by Guest

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Guest

Hi

First update for 2018

Not sure if Sorted will deem this post suitable for this wesbsite.

I've created a petition to have www.insolvencywatch.co.nz shut down, on the Change.org website.

Its just one of the many actions that will help to change our insolvency laws.

https://www.change.org/p/lisa-cowe-shut-down-www-insolvencywatch-co-nz?recruiter=350639908&utm_source=share_petition&utm_medium=copylink&utm_campaign=share_petition

Once five people have signed it then is available in the public list.

If you would like to sign and share please do.

Thanks

Ford

 

 

 

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I support the intention, but I think you would have more luck if you made the change.org campaign more about changing our bankruptcy laws. Targeting insolvency watch is probably a dead end because no one has the authority to just remove the website. Also, laws would need to change before IW is considered illegal. I feel like a campaign based more on bankruptcy law (that uses insolvency watch as an example of how crappy existing laws are) would be far stronger.

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Guest

Hi,

Thanks for your comments. Appreciated. 

There are many components to the insolvency law changes. It will be literally trial and error and I suspect many attempts at a petition before I get it right.

The IW partition is just one piece of the whole overall insolvency issue.

I'll do another one with consideration as to your suggestions.

The IW website is to do with the publishing laws, which are some of the laws I would like changed with regards to the way insolvents details are published online. Yes I take your point.

Someone of authority a while back mentioned the best way to target a problem is to attack it from all angles.

I'll create another petition and post the link.

In the meantime I visited an organisation (who wishes to remain anonymous for now) they can't provide money to help with the seminar, but they did provide a food package which I can convert to dollars and put it towards the seminar.

Ford

 

 

 

 

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Hi Ford, all the best  with your endeavours and thank you for bravely sharing your journey. It kind of ties in with my mission of changing our accounting laws. There are similar themes and parallels that are apparent in both causes.

Edited by Fiona Green

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Guest

Hi Fiona

Thanks kindly. I hope people get some benefit from my sharing.

Wow, changing the accounting laws. That will be a great challenge. But certainly needs to be done. Well done :)

Yes there are cross overs. The part I am interested in are the laws that allow the IRD to clean out a debtors bank account. Currently they can do so under the GST Act and the Tax Administration Act. Accountants occasionally have clients who that happens to.

Perhaps our missions will cross paths one day. I wholeheartedly support your endeavour.

I'm happy to share what I can if it will help your cause.

Ford

 

 

 

 

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Yes Ford our causes are interelated. I have signed your petition. I will definitely support you all the way. In the meantime I will continue drafting my  "" Change NZ Accounting Law Petition""  and accompanying  blog for this site. Your letter to Jacinda, etc on the change org site  is very good. I wonder if you,would get more signatures by changing  "if you or your loved ones have fallen on hard times..."" to "if you know of anyone..."" re:ird if that's what the law says they can do then that validates your Cause. Re the accountants - what part  do you feel they  may play here or could do differently ? 

Edited by Fiona Green

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Guest

Hi Fiona

Thanks for the suggestions. I will try that.

Accountants. What could they do differently.

A lot.

Helping clients create cashflow positive businesses would be a good start. Educate clients more about their tax obligations. Actually give business advice that suits the client's business and goals. Learn more about the real impact of insolvency so they can advise clients correctly. Halve their fees and share knowledge with clients. Encourage clients to grow their businesses to support their communities

Ford

 

 

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Guest

Hi

When you click into your petition there is a box on the right and you click on - copy link

Then put the mouse cursor on the page you want the link to go and right-click the mouse and choose paste

https://www.change.org/p/lisa-cowe-shut-down-www-insolvencywatch-co-nz?recruiter=350639908&utm_source=share_petition&utm_medium=copylink&utm_campaign=share_petition

The petition doesn't display until you get 5 supporters then it becomes live. The idea is that you send the link to your friends for them to sign it. One five is reached then the petition becomes available in the search

My petition is called Shut Down www.insolvencywatch.co.nz its one part of the bankruptcy bill draft I am still working on.

The next partition which I will put up soon will be titled Change our Insolvency laws - or something like that. Bankruptcy is one insolvency procedure out of the three.

Ford

 

Edited by Guest

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Could be a good idea to update the original post with links to petitions etc. You could also link certain individual posts from the original one to map the thread out as it gets bigger. But I think Sorted doesnt allow editing posts after a while which is annoying. Any chance editing could just be left open? @Esther from Sorted

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