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Commercial Fraud Committee


Post date: Thursday, December 19, 2019

It has been a productive year for the Commercial Fraud Committee. Our committee published two newsletters, containing six articles, and a third newsletter is currently in the works. A webinar is also planned for 2020. Here are a few highlights of our committee’s activities in 2019, as well as our upcoming plans for the new year:

Post date: Monday, November 25, 2019

As a Certified Public Accountant (CPA) who began his career as an auditor, I thought at the time that I stepped into the world of financial forensics I was prepared to embark on a career as a financial fraud auditor and expert. After all, numbers are numbers; they don’t lie or misrepresent themselves. Or so I thought.

Post date: Monday, November 25, 2019

Texas, like nearly every other state, has adopted its own version of the Uniform Fraudulent Transfer Act (UFTA).[1] The UFTA is aimed at preventing “debtors from transferring their property in bad faith before creditors can reach it.”[2] To that end, the Texas UFTA (TUFTA) ren

Post date: Monday, November 25, 2019

New York is home to many great things, such as Broadway, museums, fashion, and some of the nation’s tallest buildings.[2] Just like some of its highest buildings, New York is also home to some of the country’s highest rent prices.

Post date: Monday, November 25, 2019

With the continued expansion of international trade and the increase in cross-border transactions comes an increase in complex multi-jurisdictional disputes.

Post date: Tuesday, August 06, 2019

The General Corporation Law of Delaware (DGCL) provides a right of action against corporate directors who declare a dividend while the corporation is insolvent. Such conduct may also give rise to claims for fraudulent transfer or breach of fiduciary duty, but unlawful dividend claims have several advantages.

Michael D. Napoli
Post date: Tuesday, August 06, 2019

The Fifth Circuit recently certified an important question under the Uniform Fraudulent Transfer Act (UFTA) to the Texas Supreme Court. At issue is the futility exception to the good-faith defense provided by § 8(a) of UFTA.

Post date: Friday, January 11, 2019

Lees Inns of America (LIA) was a public company that built and operated hotels. Lester Lee (Lester) and his brother William each owned 25 percent of LIA. In 1994, LIA went private and Lester became the majority shareholder and chairman of the board. The balance of shares were held by a trust (the Trust) created by William with his two sons as co-trustees.

Post date: Friday, January 11, 2019

        An insurance policy covering directors and officers of a company can provide a valuable source of restitution for a bankruptcy estate and its creditors who have been wronged by actionable negligence and/or failures to act by corporate officers and directors. An informed plaintiff will read the applicable policy (prior to instituting suit if possible) closely, as such policies uniformly contain various exclusions to coverage.[1] When a claim against a director or officer (D&O) falls under a policy exclusion, the policy’s coverage might not apply to that claim. The insurer may issue a “reservation of rights” letter to its insured detailing those claims that the insurer has decided are not covered by the policy.

Post date: Friday, January 11, 2019

        Bankruptcy attorneys usually think of Rule 2004 of the Federal Rules of Bankruptcy Procedure as a near-unstoppable discovery tool that can be used by a debtor-in-possession (DIP), panel trustee or liquidating trustee to obtain documents needed to evaluate and successfully prosecute claims against insiders and others.[1] This to


Tue, 2020-01-14

The webinar panel, comprised of bankruptcy lawyers, a panel bankruptcy trustee and a financial advisor, will delve into what occurs when an individual debtor files bankruptcy and fails to properly disclose their assets.

Sat, 2017-12-02

Hosted by the Bankruptcy Litigation and Commercial Fraud Committees. This panel will explore whether and how far U.S. avoidance provisions might apply extraterritorially, and will discuss the challenges and pitfalls of alternate theories of recovery.

Wed, 2017-11-15

This webinar will focus on the criminal bankruptcy fraud provisions of Title 28. The presentation will use examples from well-known bankruptcy fraud cases to illustrate how these laws play out in practice. The presentation will also touch on other criminal statutes (e.g., mail and wire fraud) that are frequently implicated in bankruptcy fraud cases.

Tue, 2017-06-06

In Janvey v. Golf Channel, Inc., No. 13-11305 (5th Cir. Aug. 22, 2016), arising from the SEC enforcement action against Stanford International Bank, Ltd., pending in the U.S. District Court for the N.D. Tex., the U.S. Court of Appeals for the Fifth Circuit addressed the issue of whether trade creditors who fully perform in the ordinary course at market rates provide reasonably equivalent value to a Ponzi scheme, under the Bankruptcy Code and fraudulent transfer law in Texas (and beyond).

Fri, 2017-04-21

This panel hosted by the Commercial Fraud and Secured Credit Committee will take a fresh look at secured creditor rights and unique solvency issues in fraud and Ponzi cases. Learn how to avoid being trumped in federal forfeiture proceedings or paying on bankruptcy clawback claims by treading in the safe harbor of § 546(e) — and learn how to navigate the shoals of receivership. 

Tue, 2016-11-29

The topic of the most recent Commercial Fraud Committee call, discussed the Uniform Voidable Transactions Act (UVTA), formerly named the Uniform Fraudulent Transfer Act (UFTA), which was amended (and retitled) in 2014 for the first time since its creation in 1984.  According to the Uniform Law Commission, the amended Act, which strengthens creditor protections by providing remedies for certain transactions by a debtor that are unfair to the debtor’s creditors, addresses a small number of narrowly-defined issues and is not a comprehensive revision of the Act.

Mon, 2016-09-19

Guest speaker, James Lodoen, Esq., a partner at Linquist & Vennum, PLLP in Minneapolis, discusses Finn v. Alliance Bank (S. Ct. Minn. 2015), Kelley v. Opportunity Finance, LLC, et al. (In re Petters Company, Inc., et al.) (Bankr. D. Minn. May 31, 2016), and the Ponzi-scheme presumption.

Tue, 2016-05-31

The Commission recommended that section 550 be amended to permit the trustee to name an alleged subsequent transferee as a defendant in the original complaint to avoid any transfer under Bankruptcy Code sections 544, 545, 547, 548, 549, or 553(b), and to recover such property under section 550, rather than filing an avoidance action prior to filing a recovery action, as the Code currently requires.

Fri, 2016-04-15

People and Assets on the Move Overseas: What You Need to Know to Hold Everything Still and Seize the Assets

Tue, 2016-01-19

The Chapter 11 Commission Report recommended that the burden of proof for appointing a Chapter 11 Trustee under 1104(a) be changed from clear and convincing evidence to a preponderance of the evidence. The Commissioners determined that the existing more stringent standard has a chilling effect on parties-in-interest seeking the appointment of a Trustee, that the benefits of having a Trustee in appropriate cases outweigh the risks of abuse and unnecessary distractions that a lower standard could bring, and that adopting a preponderance of the evidence standard would resolve a split among the courts on this issue.


Mr. Ryan W. Blackney
Freeborn & Peters LLP
Chicago, IL
(312) 360-6617

Ms. Melissa Davis, CPA, CIRA, CFE
KapilaMukamal, LLP
Fort Lauderdale, FL
(954) 761-1011

Ms. Virginia Tate, CFE/CIRA/EA
Communications Manager
FAI International, Forensic Accounting & Investigations
Coeur D Alene, ID
(208) 765-5432

Mr. Walter F. McArdle, Esq.
Education Director
Spain & Gillon, LLC
Birmingham, AL
(205) 581-6295

Mr. Nathaniel J. Palmer
Membership Relations Director
Reid Collins & Tsai LLP
Austin, TX
(512) 647-6107

Mr. Michael D. Napoli
Newsletter Editor
Akerman LLP
Dallas, TX
(214) 720-4300

Mr. Adam D. Crane
Special Projects Leader
HSM Chambers
George Town, Grand Cayman
(345) 815-7364

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