STORY FROM: Reinsurance & Arbitration
Reinsurer's Loan to Hedge Fund Not Fraudulent Conveyance, N.Y. App. Court Affirms
June 23, 2017
NEW YORK — A line of credit provided by a reinsurer to a now-insolvent hedge fund did not constitute a fraudulent conveyance under New York law, a state appellate court has ruled in upholding dismissal of a claim asserted by the fund’s liquidator.
However, in a June 20 order, the New York Appellate Division, 1st Department, found the liquidator has adequately stated a claim for fraudulent conveyance by alleging that the fund transferred its interests in the collateral, allegedly worth over $200 million, to the reinsurer and others to satisfy a debt worth less than $40 million, thereby leaving the ...
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