Protect Your Assets: Bankruptcy Clawback Defense Strategies

Most people have heard about a Clawback case at some point or another, involving high-profile cases like Bernard Madoff, JPR Mechanical, Nine West, Fairfield Sentry Limited, Penisula Hospital, Tribeca Oven, New York Skyline, Agape World, Bayou Hedge Fund, Refco, Lehman Brothers Holdings, Celcius, MF Global Holdings, and many more. Clawback cases often involve complex legal battles over transactions made prior to bankruptcy filings, focusing on whether these transactions were intended to defraud, hinder, or delay creditors.

Understanding Bankruptcy Clawbacks

A bankruptcy clawback can potentially allow for the recovery of assets transferred prior to bankruptcy, typically within 90 days but potentially longer. These actions aim to ensure equal treatment of all creditors by recovering payments made to preferential creditors or those involving fraudulent activities.

Are You Facing a Preference Claim?

If you’re being asked to return funds in a clawback situation, it’s crucial to understand your rights and the defenses available. Our law firm assists individuals in assessing these types of preference claims, which could help protect your assets.

What is a Preferential Transfer?

Under Section 547 of the Bankruptcy Code, not all payments made before a bankruptcy constitute recoverable preferences. A transfer must meet specific criteria, such as being made for an antecedent debt and while the debtor was insolvent.

Defense Strategies in Clawback Actions

Our attorneys can help you challenge preference claims by demonstrating (where applicable) that the transfer does not meet the necessary criteria or by asserting defenses like ordinary course of business or new value exchanges. We also handle negotiations and litigation to protect your interests.

Settlement and Resolution of Claims

Most preference claims are settled before reaching court. Our firm’s expertise in bankruptcy litigation enables us to negotiate favorable settlements, saving you time and resources.

Why Choose Us?

Our attorneys are well-versed in bankruptcy laws and we understand the complexities of bankruptcy proceedings and are committed to achieving the best possible outcomes for our clients.

Clawback Litigation

Our law firm represents individuals targeted by lawsuits for the recovery of money or property under the Securities Investor Protection Act of 1970 (SIPA) or the United States Bankruptcy Code.

Avoidance (“clawback”) actions are often brought by a trustee or receiver in bankruptcy court after a Ponzi scheme or fraud is revealed.

Clawback actions are commenced to recover funds distributed to victims or investors by the fraudster operating the Ponzi scheme or fraud.

These actions are brought pursuant to sections 547 and 548 of the United States Bankruptcy Code against entities and individuals who have received payments from a bankrupt debtor or an insolvent entity.

Fraudulent Transfer Actions – A fraudulent transfer is any transfer or obligation made with the actual intent to hinder, delay, or defraud a creditor. Under section 548 of the Bankruptcy Code, the debtor may avoid fraudulent transfers and recover property fraudulently conveyed to a third party.

Preference Actions – Preference actions are commenced when the debtor makes certain transfers during the 90 days prior to entering bankruptcy. Bankruptcy trustees may view these transfers as preferential or unfair, and seek to remedy that alleged unfairness by recovering the money from the recipients through a preference action.

Don’t Let Bankruptcy Clawbacks Threaten Your Financial Stability

Contact us today to discuss your case with a skilled bankruptcy defense attorney and ensure your assets are protected.

Let us help you fight back and secure your rights!