Securities & Exchange Commission v. Platinum Management (NY) LLC, et al.

Key Documents

Learn more about the Settlement by downloading the documents below.

• The Receiver’s Sixth Status Report to the Court
• Notice of Proposed Sale of LC Energy and Establishment of LC Energy Claims Bar Date In Connection Therewith
• Order Authorizing the Receiver to Sell the Receivership’s Rights in LC Energy and Establishing LC Energy Claims Bar Date
• Complaint dated December 19, 2018
• The Receiver’s Fifth Status Report to the Court
• The Receiver's Fourth Status Report to the Court
• The Receiver’s Third Status Report to the Court
• The Receiver’s Corrected Second Status Report to the Court
• The Receiver’s Second Status Report to the Court
• Order Approving Expansion of Receivership

  On December 29, 2017, the Court entered an Order [Dkt. No. 297] approving the Receiver’s request to expand the receivership estate to include the following additional entities: (i) Platinum Partners Liquid Opportunity Master Fund L.P., (ii) Platinum Partners Credit Opportunities Fund International Ltd, and (iii) Platinum Partners Credit Opportunities Fund International (A) Ltd. These entities are now under the control of the Receiver and the supervision of the Court in accordance with the provisions of the Second Amended Order Appointing Receiver.

• The Receiver’s First Status Report to the Court
• Order Reassigning Case.

  Case reassigned to Judge Brian M. Cogan for all further proceedings. Chief Judge Dora Lizette Irizarry is no longer assigned to the case.

• Second Amended Order Appointing Receiver
• Order Adopting Protocols for Parties in Interest to Be Heard on Receiver Motions
• The Receiver’s Initial Status Report to the Court
• Order Approving Retention of Goldin Associates LLC
• Order Approving Retention of Otterbourg P.C.
• Facsimile Letter from Melanie L. Cyganowski to Judge Irizarry Regarding the Proposed Order Appointing Receiver
• Declaration of Neal Jacobson Pursuant to Local Rule 6.1(d) in Support of Application for an Order to Show Cause
• Declaration of Melanie L. Cyganowski dated June 26, 2017
• Securities and Exchange Commission’s Memorandum in Support of Its Application for an Order to Show Cause for Entry of a Second Amended Order Appointing Receiver and Appointment of a Substitute Receiver
• Securities and Exchange Commission’s Application for an Order to Show Cause for Entry of a Second Amended Order Appointing Receiver and Appointment of a Substitute Receiver
• The Receiver’s First Quarterly Status Report for the Period December 19, 2016 through March 31, 2017
• Order Appointing Receiver Schwartz
• Exhibits to the Complaint December 19, 2016
• Complaint dated December 19, 2016

Beechwood Litigation

To access the Beechwood Litigation Case Docket, please click here

On December 19, 2018, Melanie L. Cyganowski, as the Court appointed receiver for certain funds commonly referred to as the Platinum Partners Credit Opportunities Funds (the “Platinum Credit Funds”), through her counsel Otterbourg P.C., filed suit in the United States District Court for the Southern District of New York, against a group of defendants, including certain so-called Beechwood entities, Senior Health Insurance Company of Pennsylvania, Fuzion Analytics, Inc., Bankers Conseco Life Insurance Company, Washington National Insurance Company and CNO Financial Group, Inc. Click here to read the complaint in the action captioned “Melanie L. Cyganowski, as Equity Receiver for Platinum Partners Credit Opportunities Master Fund LP, et al. v. Beechwood RE Ltd., et al.” is now pending as Case 1:18-cv-12018 in the United States District Court for the Southern District of New York.

The Receiver’s complaint seeks redress for the massive fraudulent scheme perpetrated to the detriment of the Platinum Credit Funds and its innocent investors by certain of the now indicted and/or convicted insiders of Platinum. Specifically, the Receiver alleges that through the creation of what was a thinly disguised independent reinsurance entity, Beechwood, the Platinum insiders, fueled with money knowingly or recklessly contributed by Senior Health Insurance Company of Pennsylvania, Fuzion Analytics, Inc., Bankers Conseco Life Insurance Company, Washington National Insurance Company and CNO Financial Group, Inc., were able to prolong and expand a massive fraud that personally enriched the insiders through the generation of tens of millions of dollars in management fees, incentive fees, false profits and other remuneration over the years.

Certain of the defendants named in the Receiver’s complaint are alleged to be willing participants in the fraud, turning a blind eye from multiple red flags of fraud that left the Platinum Credit Funds in receivership gravely damaged in the form of limited liquidity, loss of their most valued assets for less than reasonably equivalent value and liens against substantially all of their assets for which less than adequate consideration was provided.

The Receiver asserts thirteen causes of action, including common law fraud, aiding and abetting of common law fraud, aiding and abetting of breach of fiduciary duty, fraudulent conveyances, federal securities fraud, and violations of the Racketeer Influenced and Corrupt Organizations Act, which collectively seek to remedy the harm inflicted on the Platinum Credit Funds in receivership for the ultimate benefit of their innocent investors and creditors. In addition to monetary damages, the Receiver seeks to avoid the first-priority liens asserted against Platinum Credit Funds’ assets by certain defendants which may otherwise adversely impact potential distributions to investors and creditors of funds.

The Receiver will update her website, http://www.platinumreceivership.com/index, with developments in the case and will address investor/ creditor inquiries regarding the suit at her next Town Hall meeting, the date and time of which have not yet been scheduled but which will be announced on the Receiver’s website. Any questions or concerns in the interim should be submitted via email to platinumreceiver@otterbourg.com.

Protocols for Parties in Interest to Be Heard on Receiver Motions

• Order Adopting Protocols for Parties in Interest to Be Heard on Receiver Motions

Case Information

Purchasing Platinum Assets

The Receiver continues to work diligently to monetize Platinum’s assets for the benefit of the Receivership Estate. She has retained Houlihan Lokey Capital, Inc. and Conway MacKenzie Capital Advisors, LLC to assist with these monetization efforts. Below, please find brief descriptions of certain Platinum assets which are, or soon may be, marketed for sale.

If you would like further information regarding any of the listed assets, please send a message so indicating to the following address: platinumreceiver@otterbourg.com. A member of the Receivership Team will respond to your inquiry as soon as practicable.

American Patriot Gold

American Patriot Gold refers to Platinum’s ownership interest in approximately 370 acres of land fee simple in Montezuma County, Colorado. The Receiver has retained a local broker, Wells Group of Durango, Inc., to market and show the property to potential purchasers.

LC Energy Holdings, LLC

Platinum maintains an interest in Goldstar Coal Mine in Green County, Indiana. Should you wish to learn more about LC Energy and bid on its assets, you should contact Richard Saltzman of Houlihan Lokey by telephone at (212) 497-4100 or by email at RSaltzman@HL.com.