Fraud Workouts & Bankruptcy

Fraudulent Transfer Litigation

 

We represent creditors in defending fraudulent transfer claims by trustees and equity receivers. Our representation includes persons who have been caught up in Ponzi schemes and are alleged to be "net winners." Such persons often have important defenses that are overlooked and undervalued. We also represent persons who are alleged to have been in collusion with the debtor. Those cases often turn on fact-intensive issues unique to the particular case. We have broad experience dealing with every contour of fraudulent transfer law.

 

Fraud Victim Workouts

 

We represent creditors and victims of frauds in obtaining distribution recoveries and in related claims proceedings. The government often employs equity receivers in fraud workouts as a substitute for more formal bankruptcy proceedings. Equity receivers are given more flexibility by the courts in fashioning workouts that provide equitable solutions for victims. This includes distribution of illegal profits disgorged by wrongdoers. In contrast, bankruptcy courts are constrained by limits imposed by the bankruptcy statute and courts are barred from structuring equitable workouts around those statutory restrictions. We are experienced in navigating both types of proceedings.

 

DOJ Restitution Funds

 

The Criminal Justice Act requires courts to order restitution for all financial crimes. The Attorney General has discretion to establish remission proceedings to distribute restitution funds to victims of financial crimes for losses actually incurred. These remission proceedings are often an important source of recoveries for losses by victims. For example, in the Madoff Victim Fund established by the Department of Justice, the fund administrator has returned almost 67% of financial losses to victims of Bernard Madoff’s fraud. We assist victims in preparing and navigating claims for recoveries.

 

SIPC Proceedings

 

We represent parties in proceedings relating to failed broker-dealers. We have participated in all of the major liquidation proceedings of broker-dealers under the Securities Investor Protection Act in the past 20 years, from MJK Clearing in Minneapolis to Lehman Brothers, Madoff Securities and MF Global in New York. These special proceedings involve liquidation of broker-dealers under the securities laws, and provide special protections for securities customers. Except for the special protections for customers, the proceedings once commenced are governed by the Bankruptcy Code, and are administered by bankruptcy judges. Uniquely, SIPC - the Securities Investor Protection Corporation - advances all fees for the trustee until customers are made whole. The broker-dealer community is assessed for the costs of the proceedings.

 
 
 
 

Contact Us:

Washington, DC  |  +1 (202) 664-7171

Tel Aviv, Israel  |  +972 (0)53 612-1364

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