Chrystyna Hankewycz Sinclair

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UNITED STATES BANKRUPTCY COURT
MIDDLE DISTRICT OF NORTH CAROLINA
DURHAM DIVISION
In re: 	)
)
Chrystyna Hankewycz Sinclair 	) 	Chapter 13
) 	Case No. 25-80223
)
Debtor. 	)
___________________________________)
ORDER ON MOTION FOR DETERMINATION THAT AUTOMATIC STAY DOES NOT
APPLY OR, ALTERNATIVELY, RELIEF FROM THE AUTOMATIC STAY
This 	case 	came 	before 	the 	Court 	for 	hearing 	on 	December 	9,
2025, (“Hearing”) on Motion for Determination that Automatic Stay
Does 	Not 	Apply 	or, 	Alternatively, 	Relief 	from 	Stay, 	ECF 	No. 	14,
filed by the United States of America (the “Creditor”) on October
17, 	2025. 	At 	the 	Hearing 	Nathan 	Strup, 	counsel 	for 	Creditor,
Samantha 	K. 	Brumbaugh, 	counsel 	for 	Chrystyna 	Hankewycz 	Sinclair
(“Debtor”), 	Anita 	Jo 	Kinlaw 	Troxler, 	the 	Chapter 	13 	Trustee, 	and
Franklin 	Greene, 	counsel 	for 	the 	Trustee 	of 	Deed 	of 	Trust,
appeared. 	ECF No. 35. 	At the conclusion of the Hearing the Court
took 	this 	matter 	under 	advisement. 	Because 	the 	automatic 	stay
SO ORDERED.
SIGNED this 14th day of January, 2026.
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does not apply to the enforcement and collection of property that
a restitution-debtor possesses a right to, the stay does not apply
to the civil action, styled United States v. Louie George Sinclair,
et 	al., 	Civil 	Case 	No. 	1:25-cv-715 	(the 	“Civil 	Action”), 	pending
in the Middle District of North Carolina.
BACKGROUND
On 	September 	30, 	2025, 	Debtor 	commenced 	this 	case 	by 	filing
a voluntary petition under chapter 13 of title 11. 	ECF No. 1. 	On
schedule 	A/B, 	Debtor 	listed 	real 	property 	located 	at 	4305
Lillington Drive, Durham, N.C. (the “Real Property”) with a value
of $476,370.00. 	Id. at 10. 	Schedule A/B lists Debtor as the only
individual 	with 	an 	ownership 	interest 	in 	the 	Real 	Property. 	Id.
On 	schedule 	D, 	Debtor 	lists 	a 	secured 	claim 	held 	by 	Freedom
Mortgage Corporation in the amount of $337,656.00, a judgment lien
in 	favor 	of 	American 	Express 	in 	the 	amount 	of 	$14,936.00, 	and 	a
disputed 	“criminal 	restitution 	debt 	against 	Debtor’s 	ex-spouse”1
in 	favor 	of 	the 	United 	States 	of 	America 	in 	the 	total 	amount 	of
$76,248.93, all of which are secured by the Real Property. 	Id. at
20-21. 	The “criminal restitution debt” arose as part of a judgment
entered 	against 	Debtor’s 	spouse, 	Louie 	George 	Sinclair. 	ECF 	No.
14. 	In 	2008, 	Mr. 	Sinclar 	was 	found 	guilty 	of 	Wire 	Fraud 	in 	the
1 Debtor’s Statement of Financial Affairs refers to Sinclair as Debtor’s “ex-
spouse,” ECF No. 1, at 21, but at the Hearing, the parties referred to him as
her spouse, and no party disputes that the property remains entireties property.
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criminal 	case 	styled, 	United 	States 	v. 	Sinclair, 	Case 	No. 	1:07-
cr-83-1 (M.D.N.C.) (the “Criminal Case”). 	ECF No. 14, Ex. 1. 	As
part 	of 	that 	court’s 	Judgment, 	Mr. 	Sinclair 	was 	ordered 	pay 	a
special 	assessment 	of 	$100.002 	and 	restitution 	in 	the 	amount 	of
$62,203.00. 	Id. 	As 	of 	September 	30, 	2025, 	payments 	totaling
$7,100.00 	have 	been 	credited 	toward 	Mr. 	Sinclair’s 	restitution
debt. 	ECF No. 14, at ¶ 3.
On 	March 	4, 	2008, 	a 	lien 	in 	favor 	of 	the 	United 	States, 	and
securing 	payment 	of 	Mr. 	Sinclair’s 	restitution 	debt, 	arose 	and
attached 	to 	all 	property, 	and 	rights 	to 	property, 	of 	Sinclair.
ECF 	No. 	14, 	Ex. 	1. 	That 	included 	Mr. 	Sinclair’s 	undivided 	one-
half 	ownership 	interest 	in 	the 	Real 	Property, 	which 	was 	owned 	by
Debtor 	and 	Mr. 	Sinclair 	as 	tenants 	by 	the 	entirety. 	ECF 	No. 	14,
Ex. 2 at ¶ 5; 18 U.S.C. § 3613(c). 	On March 31, 2008, the Office
of 	the 	United 	States 	Attorney 	for 	the 	Middle 	District 	of 	North
Carolina, 	pursuant 	to 	18 	U.S.C. 	§ 	3613, 	perfected 	that 	lien 	by
filing 	a 	notice 	of 	the 	lien 	with 	the 	Clerk 	of 	Superior 	Court 	for
Durham County, North Carolina. 	Id. at Ex. 4. 	To date, the total
amount due and owing on the restitution debt is $76,418.32, which
includes 	restitution 	principal 	in 	the 	amount 	of 	$55,103.00 	and
2 The special assessment has been paid in full. 	ECF No. 14, Ex. 2.
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interest of $21,315.32, plus any interest accruing after September
30, 2025.3 	Id.
Prior 	to 	Debtor’s 	bankruptcy, 	on 	August 	7, 	2025, 	the 	United
States 	filed 	a 	complaint 	with 	the 	Clerk 	of 	the 	United 	States
District Court for the Middle District of North Carolina, seeking
to 	enforce 	its 	lien 	against 	an 	undivided 	one-half 	ownership
interest in the Real Property through the forced judicial sale of
the 	entire 	Real 	Property 	and 	application 	of 	net 	sale 	proceeds
attributable 	to 	the 	undivided 	one-half 	ownership 	interest 	to 	Mr.
Sinclair’s restitution debt. 	Id. 	Debtor is a named defendant in
the Civil Action. 	Id. 	On October 7, 2025, Debtor filed a document
titled 	“Suggestion 	of 	Bankruptcy” 	in 	the 	Civil 	Action. 	ECF 	No.
14, Ex. 11.
On 	October 	17, 	2025, 	Creditor 	filed 	the 	instant 	Motion
requesting a determination that the Civil Action is not subject to
the automatic stay because the Mandatory Victims Restitution Act,
18 	U.S.C. 	§ 	3613, 	overrides 	conflicting 	provisions 	of 	the
Bankruptcy 	Code,4 	or 	in 	the 	alternative, 	that 	this 	Court 	grant
relief 	from 	the 	automatic 	stay, 	for 	cause 	under 	11 	U.S.C. 	§
362(d)(1). 	See 	ECF 	No. 	14. 	Creditor 	concedes 	that 	it 	only 	may
enforce 	the 	lien 	against 	Mr. 	Sinclair’s 	previous 	one-half
3 Interest is accruing on the debt at the rate of 2.040% per annum. 	ECF No.
14, at ¶ 3.
4 11 U.S.C. § 101 et seq.
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undivided 	interest 	to 	which 	the 	restitution 	lien 	attached, 	and
that the remaining net sale proceeds will be distributed to Debtor.
DISCUSSION
The 	commencement 	of 	a 	bankruptcy 	case 	immediately 	divests 	a
debtor of most interests in property she held at the time of filing
and 	vests 	that 	property 	in 	the 	bankruptcy 	estate. 	11 	U.S.C. 	§
541(a). 	The 	petition 	also 	“operates 	as 	a 	stay, 	. 	. 	. 	[of] 	the
commencement 	or 	continuation 	. 	. 	. 	of 	a 	judicial 	. 	. 	. 	action 	or
proceeding against the debtor that was or could have been commenced
before 	the 	commencement 	of 	the 	case 	under 	this 	title.” 	See
Kreisler v. Goldberg, 478 F.3d 209, 213 (4th Cir. 2007); 11 U.S.C.
§§ 	301, 	362(a)(1). 	The 	automatic 	stay 	is 	the 	fundamental
protection given to a debtor under the Code. 	It provides a debtor
with the necessary breathing room to operate and function without
harassment 	or 	fear 	of 	losing 	property 	while 	organizing 	an
overwhelming amount of debt. 	See Local Loan Co. v. Hunt, 292 U.S.
234, 	244 	(1934); 	In 	re 	Weatherford, 	413 	B.R. 	273, 	283 	(Bankr. 	D.
S.C. 	2009). 	That 	protection 	is 	not 	unlimited; 	Congress 	has
enumerated 	a 	number 	of 	exceptions 	to 	the 	stay 	in 	title 	11. 	See,
e.g., 11 U.S.C. § 362(b)(1).
Exceptions to the automatic stay also exist outside of title
11. 	Applicable 	here 	is 	Section 	3613(a) 	of 	the 	Mandatory 	Victims
Restitution 	Act 	(“MVRA”), 	18 	U.S.C. 	§ 	3613, 	which 	provides 	that
“[n]otwithstanding any other Federal law . . ., a judgment imposing
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a fine may be enforced against all property or rights to property
of 	the 	person 	fined 	. 	. 	. 	.” 	Id. 	§ 	3613(a), 	and 	which 	this 	Court
held 	in 	In 	re 	Turner, 	Case 	No. 	22-80056, 	ECF 	No. 	43, 	aff’d 	sub.
nom., 	Turner 	v. 	United 	States, 	No. 	1:22-CV-937, 	2023 	WL 	4053585,
at 	*4 	(M.D.N.C. 	June 	16, 	2023), 	supersedes 	the 	Bankruptcy 	Code,
including the automatic stay. 	11 U.S.C. § 362.
Under 	the 	MVRA, 	once 	a 	criminal 	defendant 	is 	ordered 	to 	pay
a restitution debt, a lien in favor of the United States arises on
all property, and rights to property, of the person fined, and may
be 	enforced 	in 	accordance 	with 	the 	practices 	and 	procedures 	for
the 	enforcement 	of 	a 	civil 	judgment 	under 	Federal 	or 	State 	law.5
18 	U.S.C. 	§ 	3613(a). 	Congress 	has 	unequivocally 	stated 	that
criminal 	fines 	are 	to 	be 	treated 	in 	the 	same 	fashion 	as 	federal
tax liabilities, and that a lien only terminates on the date that
is the later of 20 years from the date of entry of judgment, or 20
years 	after 	the 	restitution-debtor’s 	release 	from 	imprisonment,
and, once properly noticed, is “valid against any purchaser, holder
of 	a 	security 	interest, 	mechanic’s 	lienor 	or 	judgment 	lien
creditor. . . .” 	18 U.S.C. §§ 3613(b), (d). 	Thus, once attached,
the lien is valid against all co-owners, even if owned as tenants
by 	the 	entireties. 	See 	United 	States 	v. 	Godwin, 	446 	F. 	Supp. 	2d
425, 427 (E.D.N.C. 2006) (citing United States v. Craft, 535 U.S.
5 A lien arising under § 3613(c) is treated as if the liability were one for a
tax assessed under the Internal Revenue Code. 	18 U.S.C. § 3613(c); 26 U.S.C.
§§ 1, et. seq.
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274, 	288 	(2002))(denying 	defendant’s 	motion 	to 	dismiss 	an 	action
to enforce a restitution lien under 28 U.S.C. § 3613, because the
Supreme Court’s Craft opinion, read alongside § 3613, permits the
United States to enforce a lien against property owned by defendant
and her spouse as tenants by the entities under North Carolina law
which otherwise prohibits an individual creditor of one spouse to
levy 	upon 	property 	held 	as 	tenants 	by 	the 	entireties, 	and 	which
would 	otherwise 	permits 	one 	spouse 	to 	transfer 	her 	entirety
interest free and free of a creditors claims); 28 U.S.C. § 3613(c).
Creditor seeks entry of an order declaring that the automatic
stay 	does 	not 	apply 	to 	the 	pending 	Civil 	Action 	in 	the 	District
Court 	to 	enforce 	the 	restitution 	lien 	attached 	to 	Sinclair’s
undivided 	one-half 	interest 	in 	Debtor’s 	Real 	Property. 	Debtor
concedes that if this case were factually identical to Turner the
stay 	would 	not 	apply, 	and 	that 	the 	stay 	does 	not 	otherwise 	apply
to Sinclair’s one-half interest in the Real Property, ECF No. 35,
at 	0:04:01-0:04:13, 	but 	attempts 	to 	distinguish 	this 	case 	from
Turner 	because 	the 	Debtor 	now 	is 	the 	sole 	owner 	of 	the 	Real
Property and is not the defendant ordered to pay restitution. 	The
restitution obligation here applies only to the non-filing spouse.
Debtor 	therefore 	contends 	that 	the 	MVRA’s 	enforcement 	provision
does 	not 	except 	enforcement 	of 	the 	lien 	against 	property 	of 	a
debtor from the automatic stay where the debtor is not the “person
fined” as contemplated by § 3613(a) of the MVRA. 	Debtor emphasizes
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that 	the 	“MVRA 	rests 	on 	the 	recognition 	that 	[i]t 	is 	essential
that 	the 	criminal 	justice 	system 	recognize 	the 	impact 	that 	crime
has on the victim, and, to the extent possible, ensure that [the]
offender 	be 	held 	accountable 	to 	repay 	these 	costs,” 	and 	that
because Debtor is not the offender, the principles underlying the
MVRA 	cut 	against 	lifting 	the 	stay 	as 	to 	the 	Debtor’s 	interest 	in
the 	Real 	Property. 	United 	States 	v. 	Swenson, 	971 	F.3d 	977, 	982
(9th 	Cir. 	2020) 	(citing 	United 	States 	v. 	Novak, 	476 	F.3d 	1041,
1043 (9th Cir. 2007) (emphasis in original) (citation modified)).
Debtor also argues that because the Real Property is now property
of 	the 	bankruptcy 	estate, 	and 	because 	the 	MVRA 	is 	limited 	to
enforcement 	against 	the 	person 	fined, 	the 	government 	is 	not
entitled to modification of the stay as to property of the estate.
The 	language 	of 	the 	statute 	creates 	broader 	application 	of
the 	MVRA 	than 	Debtor 	contends. 	As 	with 	all 	statutory
interpretation, 	the 	Court’s 	analysis 	begins 	with 	the 	language 	of
the statute itself.6 	See Lamie v. U.S. Trustee, 540 U.S. 526, 533-
34 	(2004). 	As 	recognized 	in 	Turner, 	the 	statute’s 	authority 	to
pursue 	the 	property 	of 	the 	person 	fined, 	“[n]otwithstanding 	any
other 	Federal 	law” 	is 	extremely 	broad, 	and 	permits 	enforcement
6 “[W]hen ‘the statute's language is plain, the sole function of the courts—at
least where the disposition required by the text is not absurd—is to enforce it
by its terms.’” 	Hartford Underwriters Ins. Co. v. Union Planters Bank, N.A.,
530 U.S. 1, 6, (2000) (citing United States v. Ron Pair Enters., Inc., 489 U.S.
235, 241 (1989)) (internal quotations omitted).
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against “all property or rights to property of the person fined .
. . .” 18 U.S.C. § 3613(a). 	In other words, where the property of
the offender, or rights of property of the offender are at issue,
§ 	3613(a) 	applies 	without 	regard 	to 	any 	other 	federal 	enactment.
See United States v. Robinson, 494 B.R. 715, 719 (W.D. Tenn. 2013);
Turner, 2023 WL 4053585, at *2.
As 	this 	Court 	held 	and 	the 	district 	court 	stated 	in 	its
affirmance 	in 	Turner, 	“‘Congress's 	mandate 	that 	the 	MVRA 	allows
for seizure of all property or rights to property notwithstanding
any 	other 	federal 	law’ 	also 	applies 	to 	and 	supersedes 	the
Bankruptcy Code, including the automatic stay provided by 11 U.S.C.
§ 	362(a).” 	Turner, 	2023 	WL 	4053585, 	at 	*3 	(citing 	United 	States
v. Frank, 8 F.4th 320, 327 (4th Cir. 2021)).
Debtor is partly correct. 	Where the restitution-debtor holds
no 	interest 	in 	property, 	and 	when 	no 	lien 	has 	attached 	to 	the
property 	as 	a 	result 	of 	the 	restitution 	order, 	the 	MVRA 	does 	not
override 	otherwise 	applicable 	federal 	law. 	For 	example, 	in
Swenson, 	the 	Ninth 	Circuit 	addressed 	whether 	a 	defendant’s
spouse’s 	Social 	Security 	benefits 	may 	be 	garnished 	to 	collect
restitution 	imposed 	under 	the 	MVRA 	from 	the 	defendant 	in 	a
community 	property 	state. 	971 	F.3d 	at 	983. 	As 	that 	court
explained:
[I]f 	Mr. 	Swenson's 	Social 	Security 	benefits 	were 	at
issue, 	Section 	3613(a) 	would 	override 	the 	SSA's 	anti-
alienation 	provision 	as 	to 	his 	benefits, 	and 	the
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government 	would 	be 	able 	to 	garnish 	them. 	But 	because
Mrs. Swenson's benefits are not Mr. Swenson's property,
and Mr. Swenson has no right to them, the MVRA does not
override 	the 	anti-alienation 	provision 	as 	to 	Mrs.
Swenson's benefits . . . .
Id. at 984. 	(emphasis in original).
In contrast, where a restitution-debtor holds a right to the
property, 	or 	where 	a 	valid 	lien 	arose 	when 	the 	person 	fined 	held
an 	interest 	in 	the 	property, 	the 	MVRA 	overrides 	Federal 	law,
including the automatic stay. 	Debtor concedes, as she must, that
a valid lien against the undivided one-half ownership interest in
the 	Real 	Property, 	which 	was 	owned 	by 	Debtor 	and 	Mr. 	Sinclair 	as
tenants by the entirety, arose upon the entry of Judgment against
Mr. 	Sinclair 	in 	the 	Criminal 	Case, 	and 	was 	perfected 	upon 	the
notice 	of 	the 	lien. 	ECF 	No. 	35, 	at 	0:03:00-0:03:08; 	ECF 	No. 	14,
Ex. 3, at ¶ 5; see also In re Morgan, No. 21-50455, 2021 WL 5498621,
at *4 & *5 (Bankr. M.D.N.C. Nov. 4, 2021) (citing 18 U.S.C. § 3613)
(holding that debtor’s entireties interest did not exempt his real
property 	from 	process 	by 	the 	IRS 	under 	Craft), 	aff'd, 	No.
1:21CV891-LCB, 2022 WL 3354671 (M.D.N.C. Aug. 12, 2022), aff'd sub
nom. Morgan v. Bruton, 99 F.4th 206 (4th Cir. 2024). 	Debtor also
concedes that the restitution lien against the Property continues
to exist as to that undivided one-half interest and that the stay
does not apply to that interest. 	ECF No. 35, at 0:03:00-0:03:08.
The lien has not expired, has not been otherwise released, followed
the property when Mr. Sinclair transferred his interest to Debtor,
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and cannot be discharged in Debtor’s bankruptcy. 	Id. §§ 3613(c),
(e). 	The 	lien 	is 	enforceable 	under 	non-bankruptcy 	law 	by 	a 	sale
of the entire property, with Debtor receiving the net proceeds of
her 	non-encumbered 	interest, 	and 	the 	lien 	only 	terminates 	on 	the
date 	that 	is 	the 	later 	of 	20 	years 	from 	the 	date 	of 	entry 	of
judgment, or 20 years after the restitution-debtor’s release from
imprisonment. 	18 U.S.C. § 3613(b). 	Creditor now seeks to enforce
that 	judgment 	against 	Mr. 	Sinclair’s 	prior 	interest 	to 	which 	the
lien 	attached 	notwithstanding 	the 	stay 	under 	11 	U.S.C. 	§ 	362 	and
is permitted to do so under the plain language of the MVRA. 	Turner,
2023 WL 4053585, at *3.7
Only 	federal 	law, 	i.e. 	the 	automatic 	stay, 	potentially
prevents enforcement against Mr. Sinclair’s former interest in the
Real 	Property. 	The 	plain 	language 	of 	the 	MVRA 	precludes 	the
application of federal law in a way that would prevent enforcement
against 	the 	property 	of 	the 	person 	fined. 	To 	permit 	criminal
defendants 	to 	evade 	the 	provisions 	of 	the 	MVRA 	by 	simply
transferring the affected property to a spouse after the property
becomes subject to a restitution lien, not only conflicts with the
7 Debtor also argues that the commencement of the case divested Debtor from the
Real Property and vested it in the bankruptcy estate under 11 U.S.C. § 541, and
because the bankruptcy estate is not the “person fined” under the MRVA, the
stay applies. 	This Court and the district court in Turner already considered
that same argument and as the district court stated, “[the] argument that there
is a distinction between the debtor's property and the bankruptcy estate does
not impact the statutory analysis of the language of the MVRA.” 	Turner, 2023
WL 4053585, at *4.
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statue’s 	broad 	language, 	but 	also 	would 	eviscerate 	the 	statute’s
effect. 	Therefore, once a lien arises with respect to a property
interest 	of 	the 	person 	fined, 	it 	may 	be 	enforced 	“in 	accordance
with 	the 	practices 	and 	procedures 	for 	the 	enforcement 	of 	a 	civil
judgment under Federal law or State law. . . [n]otwithstanding any
other Federal Law . . . ,” and notwithstanding a voluntary transfer
of that property to a debtor thereafter. 	18 U.S.C. § 3613(a).
NOW, 	THEREFORE, 	IT 	IS 	HEREBY 	ORDERED, 	ADJUDGED, 	AND 	DECREED
that:
1. 	The 	automatic 	stay 	does 	not 	apply 	to 	the 	continuation,
enforcement, 	and 	collection 	of 	restitution 	against 	the 	Real
Property, in the Civil Action styled United States v. Louie George
Sinclair, 	et 	al., 	Civil 	Case 	No. 	1:25-cv-715, 	including 	by 	not
limited 	to 	the 	forced 	judicial 	sale 	of 	the 	Real 	Property 	located
at 4305 Lillington Drive, Durham, North Carolina.
2. 	Creditor’s 	alternative 	request 	for 	relief 	from 	stay 	is
denied as unnecessary.
[END OF DOCUMENT]
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Parties to be Served
25-80223
Chrystyna Hankewycz Sinclair
4305 Lillington Drive
Durham, NC 27704
Bankruptcy Administrator 	VIA CM/ECF
John Paul Hughes Cournoyer
Chapter 13 Trustee 	VIA CM/ECF
Anita Jo Kinlaw Troxler
Samantha K Brumbaugh 	VIA CM/ECF
Counsel for Debtor
Nathan L. Strup 	VIA CM/ECF
Counsel for Creditor
Freedom Mortgage Corporation,
c/o Travis Emil Menk, Brock & Scott PLLC,
6701 Carmel Road, Suite 315,
Charlotte, NC 28226
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