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Commercial Fraud Committee


Post date: Monday, December 28, 2015

Chasing fraudsters is never easy. They always appear to be one step ahead and creditors, in addition to having to prove the fraudulent transaction, have to also find the money or assets and be able to recover them.

Post date: Monday, December 28, 2015

In a recent decision, the United States Court of Appeals for the Seventh Circuit provided further clarification regarding the defenses available to “mediate or immediate transferees” who receive an otherwise avoidable transfer.[1]

Post date: Monday, December 21, 2015

The Commercial Fraud Committee has had a very busy and prolific year, producing one book, two webinars, three newsletters, multiple case law eblasts, and the launching of a committee wide conference call program.

Bryan Scott Perkinson
Post date: Wednesday, November 04, 2015

“Let there be an end, a privacy, an obscure nook for me. I want to be forgotten even by God.”[1] This Browning verse would serve as an apt credo for many fraudsters looking to exit the game. The problem is that today, the exit always seems to include an “obscure nook” — and a few million dollars of other people’s money.

Post date: Wednesday, November 04, 2015

Recent cases suggest that broadcasters who advertise a debtor’s fraudulent business may face exposure to § 548 claims, as was addressed in Part 1 of this article. In Part 2, we address the second element of a broadcaster’s defense: the exchange of reasonably equivalent value in exchange for payments received by the broadcaster.

Post date: Tuesday, June 09, 2015

It is well settled that state law statutes of limitations do not affect a trustee’s ability to bring fraudulent transfer actions, so long as the limitations period has not expired before the petition date.[1] Assuming that the limitations period has not expired, the limitations period essentially freezes, and the bankruptcy trustee has two years of “breathing room” to investigate and bring fraudulent transfer claims.[2]

Robert Loh, CFE, CIRA
Post date: Tuesday, June 09, 2015

In December 2014, attorneys and financial advisors serving both unsecured creditors’ committees and trustees watched as the Second Circuit expanded the “safe-harbor” provision available to defendants in certain clawback litigations. The safe-harbor provision was designed by Congress to protect certain securities and other transactions including “settlement payments” from avoidance actions. In 11 U.S.C. 546(e),[1] the Bankruptcy Code sets forth that a trustee may not avoid a transfer that was a settlement payment to (or for the benefit of) a broker or financial institution, or for a payment made in connection with a securities contract.

Post date: Tuesday, June 09, 2015

In a case of first impression, the U.S. Bankruptcy Court for the Northern District of Illinois recently held that loan payments related to a two-tiered securitization structure are protected from avoidance by 11 U.S.C. § 546(e). Specifically, in Krol v. Key Bank National Association (In re MCK Millennium Centre Parking LLC),[1] the court held that the debtor’s payments on a nondebtor affiliate’s loan, which had been transferred into a trust as part of a commercial mortgage-backed securitization, were made “in connection with a securities contract” under § 546(e) and, therefore, were not avoidable as preferential or constructively fraudulent transfers.

Post date: Tuesday, June 09, 2015

Two recent cases suggest that broadcasters who advertise a debtor’s fraudulent business may be vulnerable to § 548 claims. If the broadcaster received notice of the debtor’s fraudulent business practices, it may lack good faith. Yet a recent decision from the Fifth Circuit suggests that even if good faith exists, advertising that grew the debtor’s fraud does not provide reasonably equivalent value. In this first of two articles, good faith is addressed.

Post date: Friday, April 03, 2015

In this edition of the Commercial Fraud Committee Newsletter, we introduce a new feature: an interview with a Commercial Fraud Committee member. Our inaugural interviewee is Richard Lauter, Commercial Fraud Committee Chair. Rich is a partner at Freeborn & Peters LLP in Chicago, where he leads his firm’s Bankruptcy and Restructuring Group.


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

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

Mr. Ben A. Barnes
Communications Manager
Reid Collins & Tsai LLP
Dallas, Tx
(214) 420-8913

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

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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