Madoff Investment Securities LLC, 445 Bankr. 2013), where the court rejected the defendants’ contention that the statute starts to run as soon as the receiver is appointed, stating that the fraudulent transfer statute “requires only the exercise of reasonable diligence, not omniscience.” Id. Democratic Senatorial Campaign Committee, Inc., 791 F. The court relied on a number of cases which support the proposition that a receiver is not vested with the knowledge of the wrongdoer simply upon his appointment. The court acknowledged that in order to meet the requirements of Rule 11 of the Federal Rules of Civil Procedure, the receiver needed to know the facts underlying any possible claim before he could sue the defendant. It was only after that analysis was completed that the receiver determined that the defendant indeed had received back more than her investment and, hence, that the receiver had a fraudulent transfer claim to assert. In the case, while the receiver knew within one year of his appointment that the defendant had received money back from her investment in the Ponzi scheme, the receiver did not know whether the defendant was a “winner” in the scheme (whether she received back more than her investment) until the receiver subpoenaed records from 74 bank and investment accounts, which first had to be identified by the receiver’s professionals, and then the receiver’s accountants analyzed the 44,000 financial transactions involved. There the Court found that the limitations period did not start to run as to the receiver until the receiver determined he had a valid claim against the defendant. The most recent case to discuss this issue is Donell v. Where receivers have been appointed in Ponzi scheme cases or other fraud cases, the courts have generally not agreed with this contention. Defendants have asserted that the one year discovery period begins as soon as the receiver is appointed. A number of cases have dealt with when the one year from discovery statute of limitations starts to run with regard to a receiver. ![]() How can that be when I only just obtained the documents showing the transfers to the mother?ĪNSWER: For actual fraudulent transfers, that is transfers made with the “actual intent to hinder, delay or defraud any creditor of the debtor,” the statute of limitations in California provides that the action must be brought “within four years after the transfer was made or the obligation was incurred, or, if later, within one year after the transfer or obligation was or could reasonably have been discovered by the claimant.” California Civil Code § 3439.09(a). Counsel for the mother claims that the causes of action I am asserting against the mother are barred by the statute of limitations. I only discovered six weeks ago that the defendant had transferred hundreds of thousands of dollars to his mother, approximately 4½ years ago, in order to, I believe, hide assets from creditors pursuing him. I filed a fraudulent transfer action against the mother of the defendant in the main case in which I was appointed.
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