united states – Purple Ribbon Project http://purpleribbonproject.com/ Mon, 21 Mar 2022 13:44:39 +0000 en-US hourly 1 https://wordpress.org/?v=5.9.3 https://purpleribbonproject.com/wp-content/uploads/2021/10/icon-12.png united states – Purple Ribbon Project http://purpleribbonproject.com/ 32 32 Using Receiverships to Investigate and Combat Fraud – Insolvency/Bankruptcy/Restructuring https://purpleribbonproject.com/using-receiverships-to-investigate-and-combat-fraud-insolvency-bankruptcy-restructuring/ Mon, 21 Mar 2022 13:44:39 +0000 https://purpleribbonproject.com/using-receiverships-to-investigate-and-combat-fraud-insolvency-bankruptcy-restructuring/ Abstract In this article, Joe Wielebinski and Matthias Kleinsasser of Winstead PC provide an overview of US receivership law and how this equitable remedy can be used to fight fraud alone or in concert with other creditor remedies. The article outlines the basics of what a receivership is and what legal tools are available to […]]]>

Abstract

In this article, Joe Wielebinski and Matthias Kleinsasser of Winstead PC provide an overview of US receivership law and how this equitable remedy can be used to fight fraud alone or in concert with other creditor remedies. The article outlines the basics of what a receivership is and what legal tools are available to a receiver to administer a receivership estate when fraudulent conduct is involved. The article further discusses practical considerations for people who suspect (but may not be able to confirm) that they have been the victim of fraud and wish to seek the appointment of a receiver.

1. Introduction

The appointment of a receiver originated centuries ago in the English courts of chancery under the principles of equity. Broadly speaking, a receivership is a common law-derived equitable remedy under which a court appoints a person (the receiver) as the officer of the court to administer and protect the property (the estate or estate in receivership, which often consists of a corporation and its assets), usually because the property is threatened with dissipation or depreciation.1 A receiver is usually granted broad powers by the appointing court to manage assets, file claims, recover transferred property, and take other actions intended to preserve the receivership estate. For this reason, the appointment of a receiver is a flexible remedy that can be adapted to particular circumstances. However, since the appointment of a receiver generally results in the displacement of an entity’s management, courts generally require significant evidence of fraudulent conduct or, at a minimum, that the value of an entity or asset is gravely threatened, to grant this remedy.

2. Basics of U.S. Federal and State Receiverships

Receiverships are available under US federal and state law, although the availability of recourse and the factors required to be satisfied to appoint a receiver vary by US jurisdiction. 2 For example, most U.S. jurisdictions permit the appointment of a receiver for fraudulent conduct on the part of management persons, particularly if such persons have fraudulently transferred assets or taken other actions that threaten the rights of creditors or shareholders. . 3The appointment of a receiver is also a common remedy sought and obtained by government regulators when fraudulent conduct is suspected and/or the interests of investors are threatened, for example in proceedings brought by the Securities & United States Exchange Commission.4 The existence of fraud is generally not a prerequisite for the appointment of a receiver. Where the entity is insolvent or at risk of insolvency and the assets of the business are threatened with a severe decline in value that would seriously harm creditors, a court will often appoint a receiver whether or not fraud is suspected. .5Some US jurisdictions have also enacted laws allowing a receiver to be appointed for certain types of property, such as commercial real estate.6 In addition, the relevant statutes or the common law of many jurisdictions permit a receiver to be appointed for any reason warranted by the rules of equity, thus giving the courts wide discretion in applying this equitable remedy. 7 Also, loan documents and other contracts often give a party the right to have a receiver appointed in its sole discretion, although the courts are divided as to whether such a contractual provision is enforceable.8

The scope of a receiver’s potential powers is perhaps the most important aspect of this equitable remedy. The powers of the receiver are usually set out in the court order appointing the receiver, which means that courts can often tailor the extent of the receiver’s authority to the circumstances of the case. In general, most courts that appoint a receiver tend to grant the receiver sweeping powers unless the receiver’s powers are circumscribed by statute (for example, because the receiver is appointed under a statute authorizing appointment only for a specific purpose, such as seizing a lender’s lien on land). This could include the power to sell assets, sue and/or initiate bankruptcy proceedings, often without further approval from the nominating court. 9 In most cases, the receiver stands in the place of the entity under receivership and can act to protect the interests of any party with an interest in the entity, such as creditors and shareholders. ten Under the law of most jurisdictions, the receiver generally has the power to sell property or take other actions regarding a business that could have been taken by management of the entity, as long as those actions are authorized by court order appointing a receiver. For example, receivers are routinely authorized to consolidate assets, collect rent, pursue entity-owned claims, and review and pay creditor claims. Usually, an order appointing a receivership will prohibit creditors of the receivership estate and other third parties from taking action against the receivership outside of the court-sanctioned claims submission process.11 By doing so, the court effectively streamlines the process of winding up or rehabilitating the receivership estate and ensuring that similarly situated parties are treated fairly. Of course, the order is limited by the jurisdiction of the court and enforcement of the order against third parties may require the intervention of foreign courts.

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Footnotes

1. The potential scope of res is very broad. When a business entity is in receivership, res will often include accounts receivable, real and personal property, causes of action and intellectual property, in short, the entire assets of the business.

2. To see, for example, Fed. A. Civil. P. 66 (declaring that an action in federal court in which the appointment of a receiver is sought is governed by the Federal Rules of Civil Procedure);
Brill c. Harrington Invs. V. Vernon Savs. & Loan Ass’n, 787 F. Supp. 250, 253 (DDC 1992) (listing several factors to be considered when appointing a receiver, such as fraudulent conduct on the part of the defendant and the imminent danger of loss, concealment or impairment of the value of the goods).

3. To see, for example, Tex. Civil. Practice & Rem. Code §64.001(a)(1) (permitting the appointment of a receiver in an action brought by a seller to void a fraudulent purchase of property);
Brill, 787 F. Supp. at 253 (listing fraudulent conduct on the part of the defendant as a factor to be considered in appointing a receiver).

4. See, for example, Securities and Exchange Commission v. Stanford International Bank, Ltd., et al.3-09CV0298-N, in the United States District Court for the Northern District of Texas, Dallas Division (“Stanford Receivership”), documents available at
http://stanfordfinancialreceivership.com/.

5. To see, for example, Tex. Civil. Practice & Rem. Code § 64.001(a) (allowing a Texas court to appoint a receiver in several situations, including for an insolvent corporation or for a corporation facing imminent danger of insolvency).

6. To seefor example, Maryland Commercial Receivership Act, codified as Title 24, 2019 Maryland Code, available at https://law.justia.com/codes/maryland/2019/commercial-law/title-24/.

7. To see, for example, Tex. Civil. Practice & Rem. Code § 64.001(a)(6) (allowing a receiver to be appointed for any reason justified by the rules of equity).

8. To see, for example, LNV Corp. vs. Harrison Family. Bus., LLC, 132 F. Supp. 3d 683, 690-91 (D. Md. 2015) (discussing the division of powers on whether a receiver can be appointed under a contract).

9. To see, for example, Tex. Civil. Practice & Rem. Code §§ 64.031-64.034 (listing receiver’s power to sue, take possession of property, and take similar actions).

ten. To see, for example, Reid v. United States, 148 Fed. Cl. 503, 523 (2020) (the receiver “understands” the receiver and has fiduciary duties to creditors). Although the receivership will act for the benefit of all stakeholders, most receiverships pay creditors before providing a return on equity, in accordance with good business practices and US bankruptcy law. In large receiverships where assets have a value greater than the debt of secured creditors, creditors are usually notified of a deadline by which they must submit their claims. Claims that are filed and authorized on time are then paid pro rata to the estate in receivership according to an established priority scheme. If assets have been transferred fraudulently (as in a Ponzi scheme) or need to be recovered, the claims administration process can take years to complete while a fraudulent transfer litigation is ongoing.

11. See, p. Receivership”), available at Amended_Order_Appointing_Receiver.pdf (stanfordfinancialreceivership.com) (prohibiting the parties from asserting liens, seizing assets, pursuing claims, and taking other actions against the Stanford International Bank Received Estate). (Accessed October 11, 2021).

Originally posted by iccfraudnet.org

The content of this article is intended to provide a general guide on the subject. Specialist advice should be sought regarding your particular situation.

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Russia will open the stock market this week: the impact will be ‘internal’ and not global https://purpleribbonproject.com/russia-will-open-the-stock-market-this-week-the-impact-will-be-internal-and-not-global/ Sun, 20 Mar 2022 17:27:28 +0000 https://purpleribbonproject.com/russia-will-open-the-stock-market-this-week-the-impact-will-be-internal-and-not-global/ A bipartisan Senate delegation holds a press conference in Poland. The reopening of the Russian stock market this week is unlikely to trigger widespread unrest, according to an economic expert. “In my view, many market participants have already taken these parameters into account over the past week to manage their exposure to the Russian market, […]]]>

The reopening of the Russian stock market this week is unlikely to trigger widespread unrest, according to an economic expert.

“In my view, many market participants have already taken these parameters into account over the past week to manage their exposure to the Russian market, but markets around the world, especially Europe, Asia and the United States States, will undergo a period of adjustment,” Anthony Kim, economic freedom researcher at the Heritage Foundation, told FOX Business.

RUSSIA ORDERS CADETS FROM UKRAINE, SHIPS MORE MERCENARIES AFTER ZELENSKYY: LIVE UPDATES

Russia kept its stock market closed for three weeks as crippling financial sanctions and a significantly weaker ruble (RUB) raised fears of a sell-off and a possible economic death spiral.

Russia also faced the danger of a sovereign default, but avoided that particular hurdle with a debt payment of around $117 million. Earlier this month, ratings agency Moody’s placed Russia at the second-lowest rung of the credit ladder, just above default.

Kim said the payment created space for a “soft landing”, which helped ease “some fears”, but that the Russian economy will feel the impact far more than the rest of the world.

“There will be immediate negative ripple effects, but markets like ours and large others in Europe and Asia will make relatively smooth transitions,” Kim said.

CHINESE OFFICIAL CALLS INCREASINGLY ‘SCANDIOUS’ SANCTIONS AGAINST RUSSIA

“The Russian economy will have more of the expected impact of all the sanctions we have put in place,” he added. “The ability of the Russian government to pay its next rounds of debt payments will be reduced…there is of course this risk of sovereign debt default, but given the degree of global linkage of the Russian financial sector/system n It’s not as deep, broad and direct as sectors in other countries, the pain will be more internal over time.”

The market opening will certainly create some level of selling over the next week, and Russia will continue to seek interventions as it remains cut off from the West after the US, Europe and Japan suppressed Russia’s access to the SWIFT global economic network. system.

EU AND UK TACKLE RUSSIA WITH BROADER SANCTIONS TARGETING LUXURY

The Moscow Times reported on Friday that Russia’s Central Bank will buy government bonds when trading resumes, but it did not reveal how much it will spend to “limit risks to financial stability.”

“We are now ready to gradually resume trading on the Moscow Stock Exchange. On Monday, trading will open for government bonds,” Governor Elvira Nabiullina announced. “In order to neutralize excessive volatility and provide balanced liquidity, the Central Bank will buy government bonds.”

CHINESE EQUITIES PLUNGE ON COVID-19 FEARS, CONCERNS OVER BEIJING AND MOSCOW RELATIONSHIP

Economic experts have pointed to the significant impact of the central bank asset freeze on Russia’s ability to fight sanctions.

Earlier this month, economics professor Brian Brenberg told ‘Fox & Friends First’ that the asset freeze would be the ‘biggest shock’ to the Russian economy since ‘Putin is counting on those reserves’.

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“When the world turned against him, that’s how he was going to keep funding things,” Brenberg said. “The world said you wouldn’t get that money, so Putin is struggling on that front.”

“You can’t fund things, you can’t get money,” he said. “It’s hard to fight a war when you can’t have money.”

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Treasury yields mixed ahead of inflation data https://purpleribbonproject.com/treasury-yields-mixed-ahead-of-inflation-data/ Thu, 10 Mar 2022 09:24:56 +0000 https://purpleribbonproject.com/treasury-yields-mixed-ahead-of-inflation-data/ US Treasury yields were mixed early Thursday as investors eagerly awaited the release of inflation data later in the morning. The yield on the benchmark 10-year Treasury fell 2 basis points to 1.9270% at 4 a.m. ET. The yield on the 30-year Treasury bond was little changed and stood at 2.3022%. Yields move inversely to […]]]>

US Treasury yields were mixed early Thursday as investors eagerly awaited the release of inflation data later in the morning.

The yield on the benchmark 10-year Treasury fell 2 basis points to 1.9270% at 4 a.m. ET. The yield on the 30-year Treasury bond was little changed and stood at 2.3022%. Yields move inversely to prices and 1 basis point equals 0.01%.

February’s Consumer Price Index is due out at 8:30 a.m. ET. Economists expect headline inflation to have risen 0.7% last month, or 7.8% from a year earlier, according to Dow Jones estimates.

Investors will be eyeing inflation data, given concerns over the recent spike in commodity prices due to the Russian-Ukrainian war. The fear has been that rising commodity prices could drive up headline inflation, while slowing economic growth, also known as “stagflation”.

However, commodities including oil, silver and wheat fell on Wednesday. The decline in oil prices came amid indications of possible progress by the United States to encourage greater oil production from other sources. This follows the announcement of sanctions on Russian oil imports, in response to its invasion of Ukraine.

CNBC Pro Stock Picks and Investing Trends:

The foreign ministers of Russia and Ukraine are meeting in Turkey on Thursday for talks, hoping that a peace deal for Ukraine is in sight.

Anu Gaggar, global investment strategist for Commonwealth Financial Network, said on Wednesday she believed that if the CPI index sheds light on the impact of rising energy prices on inflation, it ” would only reinforce the Fed’s robust tightening cycle.”

“Even if a deal is magically struck tomorrow, sanctions are unlikely to be lifted quickly, meaning fossil fuel prices could stay higher for longer,” she said.

In addition to the inflation data, the number of unemployment insurance claims filed during the week ended March 5 is expected to be released Thursday at 8:30 a.m. ET.

Auctions are scheduled for Thursday for $45 billion in 4-week bills, $35 billion in 8-week bills and $20 billion in 30-year bonds.

CNBC’s Hannah Miao, Yun Li and Holly Ellyatt contributed to this market report.

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Tax penalties are not fraudulent transfers in bankruptcy: Court of Appeals https://purpleribbonproject.com/tax-penalties-are-not-fraudulent-transfers-in-bankruptcy-court-of-appeals/ Wed, 09 Mar 2022 01:20:00 +0000 https://purpleribbonproject.com/tax-penalties-are-not-fraudulent-transfers-in-bankruptcy-court-of-appeals/ The Internal Revenue Service (IRS) building is seen in Washington, U.S. September 28, 2020. REUTERS/Erin Scott Join now for FREE unlimited access to Reuters.com Register Judges cite lack of voluntary exchange of tax penalties The nonprofit organization cannot recover payments to the IRS (Reuters) – The Internal Revenue Service on Tuesday rejected an attempt by […]]]>

The Internal Revenue Service (IRS) building is seen in Washington, U.S. September 28, 2020. REUTERS/Erin Scott

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  • Judges cite lack of voluntary exchange of tax penalties
  • The nonprofit organization cannot recover payments to the IRS

(Reuters) – The Internal Revenue Service on Tuesday rejected an attempt by a bankrupt North Carolina nonprofit to recoup tax penalties it had previously paid to the agency.

The 4th U.S. Circuit Court of Appeals said Yahweh Center Inc, which provided support services for at-risk children, could not recover $180,000 in tax penalties in its Chapter 11 case, because they do not fall under the laws governing fraudulent transfers in the event of bankruptcy. .

Bankruptcy law allows debtors to recover certain payments made by a person or entity before a bankruptcy filing as so-called fraudulent transfers if they did not receive “reasonably equivalent value” in exchange.

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Richard Cook, the Yahweh Center’s bankruptcy trustee, argued that the organization’s multi-year penalty payments to the IRS should be waived under North Carolina and bankruptcy law because the center did not receive “reasonably equivalent value” in exchange. He tried to collect payments to distribute to creditors, including former employees, saying Congress failed to exempt the IRS from fraudulent conveyance laws and the U.S. Supreme Court ruled tax penalties detrimental to creditors.

The IRS argued that fraudulent conveyance laws were not intended to allow debtors to escape tax penalties.

A panel of three 4th Circuit judges upheld two lower court rulings that agreed with the IRS.

In the Tuesday decisionWritten by Circuit Judge A. Marvin Quattlebaum, the panel held that fraudulent conveyance laws do not apply to tax penalties because they do not involve any voluntary exchange between a debtor and a creditor.

The law suggests that an “oral or written agreement must take place” for the laws to apply, the panel said.

“Applying the fraudulent conveyance provisions to tax penalties would be like pushing a square peg into a round hole,” Quattlebaum wrote. He was joined in the decision by circuit judges Steven Agee and Stephanie Thacker.

The panel cited a 2012 6th Circuit decision that made similar findings.

Cook said Tuesday the court’s decision was disappointing and barred former workers who owed $200,000 in back wages from collecting further collections.

“Perhaps Congress can educate the courts and the public on whether tax penalties should be avoided in bankruptcy cases through future legislation,” he said.

An IRS spokesperson said it does not comment on ongoing litigation.

The case is Cook v. United States, US 4th Circuit Court of Appeals, No. 20-1685.

For Yahweh: Richard P. Cook

For the United States: Rachel Ida Wollitzer of the Department of Justice

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Our standards: The Thomson Reuters Trust Principles.

market volatility and more recent macroeconomic uncertainties. That said, we think JEF looks interesting on the short side with the current level creating a new buying opportunity. The company raised its quarterly dividend, which now offers one of the highest yields among a peer group of U.S. investment bankers in the industry among U.S. banks at 3.6%, supported by overall strong fundamentals and positive long-term outlook.

JEF Stock Chart

Looking for Alpha

Jefferies – Financial summary

Jefferies reported fourth-quarter earnings on Jan. 12 with non-GAAP EPS of $1.36 beating expectations by $0.11, while GAAP earnings at $1.20 were slightly below estimates. Revenue of $1.8 billion was down 2.7% year-over-year, although context considers the comparable period to the fourth quarter of 2020 was exceptionally strong at the start of the pandemic recovery. Full-year 2021 revenue of $8.2 billion, up 36% YoY with EPS of $6.13, up 131% from $2.65 in 2020, more reflect the underlying dynamics.

Jefferies Financial - Net Income

source: IR company

While the Investment Banking and Capital Markets segment managed to maintain positive year-over-year growth in the fourth quarter, the lower revenue decline in the Asset Management group was based on market returns lower over the period. Investment banking was also down in the fourth quarter, again given tough competition in the prior year.

Jefferies increased its workforce and higher overall compensation added to expenses as a broader financial industry theme in a tight labor market. The core financial measure in an annualized return on adjusted tangible equity at 16.5% was down from 17.5% in the year-ago period.

Dividend hike and buyouts from Jefferies

Jefferies has increased its quarterly dividend in each of the past 6 years, including the last increase to $0.30 per share, which yields 3.6% on a forward-looking basis. The last payment took place in February and shareholders can expect the second quarter dividend in May. The company has also been active in share buybacks, repurchasing approximately $269 million of common stock over the past year, which has reduced the number of shares by approximately 3.5%. Additionally, with the release of fourth quarter results, the company increased its repurchase authorization by $88 million to a total of $250 million. By combining the two, the capital allocation strategy implies a shareholder return close to 7% taking into account the dividend and redemptions. We consider JEF to be a high-quality dividend-paying stock in the financial sector.

Jefferies Financial Dividends and Share Buybacks
Data by YCharts

JEF stock price prediction

The key takeaway from the trends in 2021 is the impressive growth over the past few years as Jefferies’ business ramps up during the pandemic. Total revenues increased by more than 125% compared to 2019. The company notes an average annual growth rate of 17.5% in net profit since the year 2000, with the story being an ascent in the “league tables for various financial services products and segments.

Jefferies Financial Revenue and Earnings Growth

source: IR company

Jefferies now ranks 6th in the world or 5th in the United States for mergers and acquisitions by deal value. The company is also in the top 5 for trading and equity research, while occupying the top spot in US LBO loans. In other words, Jefferies has established itself among the names of the “bulge bracket” as a major player in finance. The point here is that Jefferies is well positioned to continue to grow and consolidate market share as part of a long-term bullish thesis for the stock.

Progress of Jefferies Financial 2021

source: IR company

There are some near-term headwinds that are hard to ignore in the current market situation defined by extreme market volatility with the ongoing conflict between Russia and Ukraine. Simply put, it’s not an ideal environment for mergers and acquisitions, which is the group’s core operational business. The combination of tough competition with a record 2021 year and rising interest rate trends make for a tougher remainder of 2022.

This dynamic is reflected in current consensus estimates. The market expects revenue of $6.4 billion in fiscal 2022 to decline 22% year-over-year, while EPS will decline 38%. For 2023, the outlook is for a rebound in revenue and earnings momentum, but clearly there is a lot of uncertainty in these estimates beyond 2022.

JEF revenue and EPS estimates

Looking for Alpha

From a traders’ perspective, there is reason to believe that the stock’s sell-off has already taken some of these weaknesses into account. Shares of JEF are down 26% from their Q4 2021 high and we note that the shares currently around $33.00 have returned to a level that appears to represent significant technical support back to the levels of the first quarter of last year. We think the stock should be able to consolidate around this level

JEF fee schedule

Looking for Alpha

Given a forward yield on the stock of approximately 3.6% (2.9% year over year), we note that JEF’s dividend is one of the largest among peer investment banks. taking into account JPMorgan Chase & Co. (JPM) and Morgan Stanley (MS) dividend yield of approximately 2.75%. To be clear, there are other financial institutions with a higher dividend yield like Lazard Ltd (LAZ) and Moelis & Co. (MC) closer to 5%. Each bank here has its own business-specific dynamics and generally focuses on different financial products and services.

JEF’s payment appeal is the larger scale of the business that has moved beyond a ’boutique’ profile including global operations. We argue that JEF stands out for its diversification within investment banking and capital markets activities which offers higher long-term growth potential compared to the industry as a whole.

JEF Dividend Yield vs Peers
Data by YCharts

Final Thoughts

There’s a lot to love about JEF as a high-quality segment leader that has established an impressive trend of operational and financial momentum. We rate the stock as a buy with a price target of $40 given the recent weakness. At our price target, JEF would trade at a forward dividend yield closer to 3%, which is more in line with industry peers. JEF appears to be a value pick in the financial sector in our view on this sell-off.

Beyond the Russian-Ukrainian conflict, improved confidence in risky assets could be enough to rekindle momentum and lift stocks higher. For income investors, the JEF’s dividend yield makes it a good choice among investment banking stocks and a strategy of slowly starting to accumulate stocks may make sense.

Among the main risks to watch is a further deterioration in economic conditions. The persistence of high inflation combined with a slowdown in economic growth constitutes an unfavorable context for investment banking activities. Weaker-than-expected results in the coming quarters can also push stocks down.

]]> Bankruptcy filing details $4 million distribution of Nordic Aviation Capital’s legal bill https://purpleribbonproject.com/bankruptcy-filing-details-4-million-distribution-of-nordic-aviation-capitals-legal-bill/ Thu, 03 Mar 2022 02:30:00 +0000 https://purpleribbonproject.com/bankruptcy-filing-details-4-million-distribution-of-nordic-aviation-capitals-legal-bill/ Late-night takeout, taxi fares and $1,800-an-hour lawyers rack up millions in fees for Limerick-based lessor Nordic Aviation Capital as it winds its way through bankruptcy in the United States. The lessor is also in the process of selling eight jets to American Airlines, according to court documents. The sale of the four aging Embraers and […]]]>

Late-night takeout, taxi fares and $1,800-an-hour lawyers rack up millions in fees for Limerick-based lessor Nordic Aviation Capital as it winds its way through bankruptcy in the United States.

The lessor is also in the process of selling eight jets to American Airlines, according to court documents.

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New York Federal Court Upholds Bankruptcy Court Fraudulent Conveyance Finding for Tax Sale Foreclosure – Insolvency/Bankruptcy/Restructuring https://purpleribbonproject.com/new-york-federal-court-upholds-bankruptcy-court-fraudulent-conveyance-finding-for-tax-sale-foreclosure-insolvency-bankruptcy-restructuring/ Tue, 01 Mar 2022 03:33:57 +0000 https://purpleribbonproject.com/new-york-federal-court-upholds-bankruptcy-court-fraudulent-conveyance-finding-for-tax-sale-foreclosure-insolvency-bankruptcy-restructuring/ United States: New York Federal Court Upholds Bankruptcy Court Fraudulent Transfer Finding for Tax Sale Foreclosure March 01, 2022 Riker Danzig Scherer Hyland & Perretti To print this article, all you need to do is be registered or log in to Mondaq.com. The United States District Court for the Western […]]]>


United States: New York Federal Court Upholds Bankruptcy Court Fraudulent Transfer Finding for Tax Sale Foreclosure

To print this article, all you need to do is be registered or log in to Mondaq.com.

The United States District Court for the Western District of New York recently upheld a bankruptcy court’s findings that the in rem tax seizure of the subject property was a fraudulent conveyance. To see Duvall v. Cty. of Ont., 2021 US Dist. LEXIS 216970 (WDNY 2021). The case arose out of the tax foreclosure of the property (the “Property”) for non-payment of taxes that occurred in 2015. In October 2016, the County issued a motion and notices of foreclosure, advising that interested parties had the right to redeem the property. on or before January 13, 2017. The debtor did not redeem the property or respond to the foreclosure petition, and a foreclosure default judgment on the property was entered on March 7, 2017. The property was sold at auction on May 17, 2017, but the title was not actually transferred pending final legal resolution of the case. The debtor filed for bankruptcy on or about March 1, 2019 and submitted a plan on March 13, 2019. The debtor then sued the county, claiming the seizure was a fraudulent conveyance. The bankruptcy court accepted and reversed the tax seizure as a fraudulent conveyance.

The county appealed. Regarding the fraudulent conveyance, the county argued that the court should extend the holding of
BFP c. Trust Resolution 511 US 531 (1994) to this action for tax foreclosure in rem. In that case, the U.S. Supreme Court held that a mortgage foreclosure action that was brought pursuant to state law is, in the absence of a “clear statutory requirement to the contrary”, based on the presumption that the debtor received “reasonably equivalent value” for his property under the Bankruptcy Code. The bankruptcy court here, however, relied on another case from the Western District of New York, Hampton v. Ontario County, 588 BR 671 (WDNY 2018). the
Hampton The court found that New York’s property tax law was precisely the type of “draconian” strict foreclosure regime that the Supreme Court had characterized in BFP as a “relic of the unenlightened past”, as it did not guarantee the debtor’s receipt of reasonably equivalent value in circumstances of forced sale. The Court therefore concluded that the proceeds of the forced sale of the Property resulted in a substantial windfall to the County at the expense of all other creditors, thereby rendering the sale a fraudulent conveyance. Accordingly, the district court sided with the bankruptcy court, finding that a state’s interests must be balanced against the firm policy of the Bankruptcy Code favoring equal treatment of creditors, and upheld the annulment by the bankruptcy court of the tax seizure in rem.

The content of this article is intended to provide a general guide on the subject. Specialist advice should be sought regarding your particular situation.

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In this article, the authors review the elements that should be included in a non-consolidation opinion issued to the lender in the context of a structured finance transaction by the board of the special purpose entity.

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Bankruptcy judge’s reprimand must not deter CD 15 citizens from voting for me https://purpleribbonproject.com/bankruptcy-judges-reprimand-must-not-deter-cd-15-citizens-from-voting-for-me/ Sun, 27 Feb 2022 16:18:15 +0000 https://purpleribbonproject.com/bankruptcy-judges-reprimand-must-not-deter-cd-15-citizens-from-voting-for-me/ EDINBURGH, Texas — Ruben Ramirez, a lawyer by profession, says a federal judge’s rebuke of him shouldn’t be enough to stop voters from supporting him in the 15 Congressional District race. Ramirez is running for the CD 15 open seat in the Democratic Party primary. Last year, representing Pharr resident Lorena Singh, Ramirez persuaded a […]]]>

EDINBURGH, Texas — Ruben Ramirez, a lawyer by profession, says a federal judge’s rebuke of him shouldn’t be enough to stop voters from supporting him in the 15 Congressional District race.

Ramirez is running for the CD 15 open seat in the Democratic Party primary.

Last year, representing Pharr resident Lorena Singh, Ramirez persuaded a state district judge to sign a temporary restraining order (TRO) to prevent the city of Pharr from acquiring the assets of Hidalgo County EMS at a bankruptcy auction.

The restraining order threatened to scuttle the sale and disrupt ambulance service, reported journalist Dave Hendricks for the Mission progress time last April.

“The mentality of bankruptcy is that you pick up the phone and ask before you sneak into state court and get a $100 TRO,” U.S. Bankruptcy Judge David R. Jones said, when the case was heard in federal court in Corpus Christi.

Jones is the Chief Judge of the United States Bankruptcy Court for the Southern District of Texas. He was appointed to the court on September 30, 2011 and became the court’s chief justice in 2015.

Corpus Christi attorney Nathaniel Peter Holzer represented Hidalgo County EMS. Holzer said Singh, and by extension his attorney Ramirez, was simply wrong on the facts and wrong on the law.

Judge Jones agreed. “Lawyers familiar with federal bankruptcy court would know better than to seek a temporary restraining order in state court, Jones said, adding that he would assume Ramirez just didn’t know how the process worked,” reported Hendricks for the Progress time.

Had a seasoned bankruptcy attorney like Holzer attempted such a maneuver, Jones said he would have responded in a different way, Hendricks reported.

“Suppose Mr. Holzer filed the lawsuit you filed. Mr. Holzer would be in my courtroom today and there would be a U.S. Marshal with a set of handcuffs standing right next to him,” the official said. Progress time reported Jones as saying. “I’m going to assume that you (Ramirez) are just not familiar with all the applicable bankruptcy rules and issues and my jurisdiction and that sort of thing.”

The bankruptcy process is transparent, Jones said, and anyone with concerns can file an objection, the Progress time story told.

“There are several ways to go about getting your client’s rights and arguments heard and vindicated one way or another,” Jones said. “But doing what you did is not the right way to do it.”

Asked by the Guardian of the Rio Grande If voters were to take notice of Judge Jones’ warning, Ramirez (pictured above) said: ‘No, nothing at all. Look, as a lawyer, I was hired. I was selected for this. I took a look at it and realized that, hey, there might be some merit in that. It’s no different than anybody else (a lawyer) taking on some kind of case for a defendant or anything else. That doesn’t make them guilty of that.

Ramirez said the decision to take the case, pursue a TRO and try to prevent the city of Pharr from acquiring the ambulance company’s assets did not reflect badly on his character.

“I respectfully disagree with the judge’s version of what happened, but that has no bearing in this particular case. It’s like that. He (Judge Jones) made the decision. Sometimes we agree, sometimes we disagree. In this case, I don’t agree with that but, in the end, we still respect it because it’s the rule of law, that’s what the courts are made for. And that’s where we are.”

When solvent, Hidalgo County EMS provided ambulance service in Edinburg, Pharr, and rural South Texas. When Hidalgo County EMS filed for bankruptcy, owing $2.6 million to the IRS, the town of Pharr rushed to acquire its assets. Pharr City Ambulance services have now been extended to a number of smaller towns in Hidalgo County.

When asked if the ambulance business was now in the wrong hands, Ramirez said: ‘I won’t necessarily talk about that aspect, but it was up to the citizens of Pharr to decide. I am for transparency. But, again, I felt it was a case that potentially had merit. I got held up on it, didn’t I? The judge made his decision. I respect the judge’s decision even if I don’t agree with it. It’s America.

Singh, a resident of Pharr, is a social worker who ran an unsuccessful campaign for the Pharr City Commission in 2019. Singh argued there were conflicts of interest in Pharr’s bid for Hidalgo County EMS and that the secrecy had tainted the sales process. So, through her lawyer Ramirez, she filed a complaint. The TRO was signed by State District Judge Roberto “Bobby” Flores.

the Progress time reported that Hidalgo County EMS had “constant cash flow issues” and failed to file a tax return. After filing for protection under bankruptcy laws, Hidalgo County EMS was supposed to devise a reorganization plan to restructure the business. This never happened and its director of restructuring recommended finding a buyer. The City of Pharr filed the only bid for its assets.


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Warren Buffett notes that Weschler and Combs control $34 billion investments: annual letter (NYSE: BRK.A) https://purpleribbonproject.com/warren-buffett-notes-that-weschler-and-combs-control-34-billion-investments-annual-letter-nyse-brk-a/ Sat, 26 Feb 2022 14:27:00 +0000 https://purpleribbonproject.com/warren-buffett-notes-that-weschler-and-combs-control-34-billion-investments-annual-letter-nyse-brk-a/ Chip Somodevilla/Getty Images Long associated with Warren Buffett’s investment acumen, Berkshire Hathaway (NYSE: BRK.B) (NYSE: BRK.A) the collection of participations is ensured by the management of the company longtime investment managers Todd Combs and Ted Weschler, Buffett said in his 2021 letter to shareholders. Notably, he said, “at the end of the year, this valued […]]]>

Chip Somodevilla/Getty Images

Long associated with Warren Buffett’s investment acumen, Berkshire Hathaway (NYSE: BRK.B) (NYSE: BRK.A) the collection of participations is ensured by the management of the company longtime investment managers Todd Combs and Ted Weschler, Buffett said in his 2021 letter to shareholders.

Notably, he said, “at the end of the year, this valued pair had total authority over $34 billion in investments.” In addition, a significant portion of the investments the two manage come from various Berkshire-owned company pension plans, which are not included in the chart of its major holdings.

The fact that Buffett is drawing attention to Combs and Weschler as investment managers means that the company’s investment decisions can no longer be attributed solely to Buffett. He has focused in recent years on the company’s plans for a post-Buffett future. Last year, he named Greg Abel to eventually succeed him as CEO.

The company’s largest stake is in Apple (NASDAQ:AAPL) stake, with a market value of $161.2 billion at the end of 2021. This is followed by Bank of America (NYSE: BAC)worth $46.0 billion, American Express (NYSE:AXP)at $24.8 billion, and Coco-Cola (NYSE:KO) at $23.7 billion.

Buffett highlighted the company’s contribution to the US Treasury, saying that when Berkshire (BRK.B) thrives, the US shares in that success too. In 2021, the company paid $3.3 billion in federal income taxes. That’s about 0.8% of the $402 billion in total corporate tax revenue the US Treasury reported for the year.

He attributes the company’s prosperity to the fact that Berkshire (BRK.B) operates in the United States “Our shareholders should recognize – trumpeting effect – the fact that Berkshire’s prosperity has been greatly aided because the company has operated in America,” he wrote.

While Berkshire Hathaway (BRK.B) (BRK.A) is mostly considered a “somewhat odd collection of financial assets,” the company owns and operates more U.S.-based infrastructure assets” than any other American company,” Buffett said.

In the letter, he outlined the company’s “big four” that account for much of Berkshire’s value – its insurance business, Apple (AAPL), railroad BNSF and its energy unit BHE.

Insurance: Buffett is a big fan of the insurance float — the amount of money collected from premiums he has on hand to invest. “The insurance business is made to order for Berkshire. The product will never be obsolete and sales volume will generally increase with economic growth and inflation.”

On Apple (AAPL): Berkshire’s (BRK.B) stake in the tech giant grows as Apple buys back its own shares. Its 5.55% stake has fallen from 5.39% a year ago. “It looks like small potatoes. But consider that every 0.1% of Apple’s revenue in 2021 was $100 million. We spent no Berkshire fund to earn our increment. Apple’s buyouts did the job.” And last year, the tech company paid Berkshire $785 million in dividends, which are included in Berkshire’s GAAP earnings (BRK.B).

BNSF: “Your Railroad Had Record Revenues of $6 Billion in 2021…the Old Fashioned Type of Revenue We Favor: A Calculated Figure after interest, taxes, depreciation, amortization and all forms of compensation.” He also pointed out that the railroad’s trains traveled 143 million miles and carried 535 million tons of freight last year – both “exceeding far ahead of any other US carrier.”

BHE: The unit earned a record $4 billion in 2021, more than 30 times more than the $122 million it earned in 2000, when Berkshire (BRK.B) first bought a stake in BHE; now owns 91.1% of the company. He pointed out that the unit now details renewable energy and transmission plans and performance every year since 2007. BHE has reduced its greenhouse gas emissions to 63.5 million metric tons in 2021 from 79.9 million metric tons in 2005; it is targeting 39.9 million metric tons in 2030.

Earlier, Berkshire Hathaway repurchased $6.9 billion in shares in the fourth quarter, driving operating profits up 45% year-on-year

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Global Blockchain Companies Shaking Up the Financial Investment Space – Blockchain News, Opinion, TV and Jobs https://purpleribbonproject.com/global-blockchain-companies-shaking-up-the-financial-investment-space-blockchain-news-opinion-tv-and-jobs/ Fri, 25 Feb 2022 17:10:30 +0000 https://purpleribbonproject.com/global-blockchain-companies-shaking-up-the-financial-investment-space-blockchain-news-opinion-tv-and-jobs/ Blockchain has become a legitimate disruptor in the financial investment space worldwide. The technology has become so promising that tech giant IBM is gearing up for more than $200 million to facilitate research and invest in it. companies providing blockchain development services. Nearly over 90% of banks in Europe and the United States are also […]]]>

Blockchain has become a legitimate disruptor in the financial investment space worldwide. The technology has become so promising that tech giant IBM is gearing up for more than $200 million to facilitate research and invest in it. companies providing blockchain development services. Nearly over 90% of banks in Europe and the United States are also exploring how blockchain options can make life easier for their customers and help them bank more efficiently. Blockchain technology also helps individual investors and businesses to securely invest in cyber assets that offer higher returns than regular investments. Here we share profiles of global blockchain companies that are shaking up the global financial investment space.

BLOCKDAEMON

To create a seamless blockchain experience, Blockdaemon is a blockchain development company which has created a very advanced and independent blockchain infrastructure, so that customers have access to the ideal platform for crypto and financial investments.

TO REPRODUCE

For those looking to invest in non-fungible tokens (NFTs), RECUR is the perfect place to start. The company allows people to not only buy NFTs safely, but also to resell them safely, keeping dedicated collectors at the forefront of this revolution.

COINBASE

Coinbase is a blockchain development organization which allows users to securely buy and sell cryptocurrencies. With advanced features such as vault protection Since 2012, over $150 billion has been traded by over 20 million investors on this platform.

CORNER

Coinme has partnered with Coinstar to develop a network of bitcoin kiosks across the United States that accept cash investments and allow users to store their investments through the Coinme app, making it easier for them to start investing in multiple cryptocurrencies.

PAXFUL

Paxful is one of companies providing blockchain development services which operates a peer-to-peer cryptocurrency marketplace that allows investors to securely buy and sell multiple cryptocurrencies through over 350 secure payment options. The main features of Paxful are bank-to-bank transfers, online wallets, digital currency trading, cash payments, goods/services trading and debit/credit card access,

SALT

Through SALT’s blockchain-based platform, users can leverage their cryptocurrency to get cash loans as low as $5,000. Borrowers can take out these loans for any term from 1 to 36 months, leveraging cryptos like Bitcoin, Dogecoin, and Ether.

GEMINI

Gemini is a digital asset exchange powered by blockchain technology that allows users to buy, sell and trade major cryptocurrencies with all security checks and balances. This blockchain development company the platform deploys blockchain for trading and cybersecurity,

ROBIN HOOD

Robinhood is a blockchain-based stock brokerage app that allows users to securely buy and sell stocks, cryptocurrencies, and ETFs and has received over $500 million in venture capital funding .

LEMONADE

Lemonade deploys the seamless combination of blockchain technology and artificial intelligence to help users receive tenant and landlord insurance at affordable rates. By using AI to create the optimal flat rate for an insurance customer, Lemonade’s blockchain-based smart contracts help lock users into a payment agreement. Using its advanced blockchain technology, Lemonade approves insurance claims and releases payments not in days but in minutes, rather than days.

BitMEX

Bitcoin Mercantile Exchange (BitMEX) is a cryptocurrency derivatives trading platform with over half a million active clients. Launched by former bankers with a tech background.

NETKI

Rivaled only by the advent of the internet, Netki’s blockchain technology makes the use of cryptocurrencies completely safe for businesses. blockchain development organization advanced software generates a unique digital wallet and currency identifier that facilitates the execution of fully compliant transactions.

CELSIUS

Celsius gives its customers the ability to easily leverage their crypto units for cash loans. Instead of tracking borrowers’ traditional credit scores, the software determines interest rates dynamically, based on the amount of collateral the borrower can pledge. Since June 2018, the Celsius Network has disbursed over $600 million in monetary loans, with $5 million being the highest loan amount.

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