Securities & Exchange Commission v. Platinum Management (NY) LLC, et al.
On November 13, 2020, the Receiver filed a motion (the “Motion”) in the United States District Court for the Eastern District of New York (the “District Court”) requesting entry of an order approving claims and interests reconciliation and verification procedures in connection with Claims against, and Interests in, any one or more of the Receivership Entities. The Motion, and supporting documents, can be found by clicking here. Any opposition to the Motion must be (i) made in writing; (ii) if by a party, electronically filed with the District Court; or (iii) if by a non-party, electronically mailed to the Receiver at her email address, firstname.lastname@example.org, so as to be actually received no later than November 30, 2020.
As set forth in more detail in the Motion, the Receiver seeks entry of an order authorizing the Receiver to (i) determine the validity of Claims, including the allowed amount, if any, of Claims and whether a Claim is secured by property of a Receivership Entity; (ii) notify Claimants of the Receiver’s determinations regarding the validity, amount (if any) and secured nature, of their Claims; (iii) notify Investors of the amounts they invested in and received from the Receivership Entities, as recorded in the Receivership Entities’ books and records; (iv) provide Claimants with an opportunity to dispute the Receiver’s determinations regarding their Claims, and Investors with an opportunity to dispute the Receivership Entities’ records regarding their Interests; (v) negotiate and settle disputes in connection with Claims and Interests; and (vi) in the event disputes are not resolved by agreement, implement procedures to seek relief from the Court through summary proceedings. By the Motion, the Receiver is seeking only the Court’s approval of the Receiver’s proposed procedures for finalizing the reconciliation and verification of Claims and Interests and is not at this time seeking approval of the validity, amount, classification, or distribution methodology on account of any Claims against, or Interests in, any of the Receivership Entities.
December 11, 2019 WEBINAR VIDEO – Investor & Creditor Forum
August 14, 2019 WEBINAR VIDEO – Investor & Creditor Forum
RECEIVER’S STATEMENT ON JURY VERDICT IN CRIMINAL TRIAL
July 11, 2019
We are aware that many of you have been closely following the criminal trial of Mark Nordlicht, David Levy and Joseph SanFilippo, and have questions as to how the verdicts in that case may impact the Receivership. The Receivership was established with Mark Nordlicht’s consent in the civil enforcement case brought by the Securities and Exchange Commission titled SEC v. Platinum Management (NY) LLC, et al., case No. 16-cv-06848 (E.D.N.Y.) (BMC). Unlike the criminal trial, it is a civil action which will, at a certain point, be resolved before Judge Cogan. Our role is to administer the Receivership. We are not involved in either the prosecution of the criminal case by the Department of Justice or the advancement of the civil litigation by the SEC. The Receiver will continue her work as governed by the Court Orders, and will continue to provide updates on her progress.
March 12, 2019 WEBINAR VIDEO – Investor & Creditor Forum
December 4, 2018 WEBINAR VIDEO – Investor & Creditor Forum
AUGUST 15, 2018 WEBINAR VIDEO – Investor & Creditor Forum
JUNE 6, 2018 WEBINAR VIDEO – Investor & Creditor Forum
DECEMBER 20, 2017 WEBINAR VIDEO – Investor & Creditor Forum
MARCH 1, 2018 WEBINAR VIDEO – Investor & Creditor Forum
DECEMBER 20, 2017 WEBINAR VIDEO – Investor & Creditor Forum
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.
On March 29, 2019, Melanie L. Cyganowski, the Court appointed receiver for certain funds commonly referred to as Platinum Partners (the “PPCO Funds”), through her counsel Otterbourg P.C., filed an amended complaint in the United States District Court for the Southern District of New York against, among others, (i) certain so-called Beechwood entities, (ii) Senior Health Insurance Company of Pennsylvania, (iii) Fuzion Analytics, Inc., (iv) CNO Financial Group, Inc., (v) Bankers Conseco Life Insurance Company, (vi) Washington National Insurance Company and (vii) 40|86 Advisors, Inc. Click here to read the amended redacted 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.” now pending as Case 1:18-cv-12018 in the United States District Court for the Southern District of New York. As is fairly standard in similar cases, the Receiver exercised her right under the applicable rules and orders of the court to amend the originally filed complaint.
The Receiver’s amended complaint seeks redress for the innocent investors and creditors of her estate damaged by the defendants’ unlawful and tortious acts. The Receiver alleges that through their creation of Beechwood, a purported independent reinsurance entity, the Platinum insiders expanded a pre-existing fraud that personally enriched them through the generation 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 amended complaint are alleged to have substantially assisted, and participated with, Beechwood and the Platinum insiders to commit fraud and breach their fiduciary duties to the PPCO Funds. Specifically, these defendants – acting through Beechwood – structured and implemented a series of transactions that ultimately saddled the PPCO Funds with approximately $69.1 million of debt owing to Beechwood, as agent for the insurers, secured by liens on substantially all of the PPCO Funds’ assets, including those of nearly all of their portfolio companies, in consideration for assets that were worth a fraction of that amount.
For these reasons, the Receiver asserts causes of action for, among other things, (i) violations of the Racketeer Influenced and Corrupt Organizations Act and/ or federal securities fraud; (ii) aiding and abetting common law fraud; (iii) aiding and abetting breach of fiduciary duty; (iv) actual and constructive fraudulent conveyances; and (v) unjust enrichment. In addition to monetary damages, the Receiver seeks to avoid the first-priority liens asserted against PPCO Funds’ assets by certain defendants which may otherwise adversely impact potential distributions to investors and creditors.
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 email@example.com.
Protocols for Parties in Interest to Be Heard on Receiver Motions
230 Park Avenue
New York, NY 10169
Attention: Adam C. Silverstein
Erik B. Weinick
FINANCIAL ADVISOR TO RECEIVER
Goldin Associates LLC
350 Fifth Avenue
The Empire State Building
New York, NY 10118
Attention: Marc Kirschner
1:16-cr-00640-BMC USA v. Nordlicht et al
1:16-cr-00640-BMC-1 Mark Nordlicht
1:16-cr-00640-BMC-2 David Levy
1:16-cr-00640-BMC-3 Uri Landesman
1:16-cr-00640-BMC-4 Joseph Sanfilippo
1:16-cr-00640-BMC-5 Joseph Mann
1:16-cr-00640-BMC-6 Daniel Small
1:16-cr-00640-BMC-7 Jeffrey Shulse
Docket Items for the above cases can be located at the PACER portal for the Eastern District of New York, located here.
The Court has established the following dates by which claims by non-investor creditors against the Receivership Entities must be filed:
(i) 5:00 p.m. (prevailing Eastern Time) on March 29, 2019 as the deadline for Claimants other than Governmental Units to submit Proofs of Claim against the Receivership Entities; and
(ii) 5:00 p.m. (prevailing Eastern Time) on April 12, 2019 as the deadline for Governmental Units to submit Proofs of Claim against the Receivership Entities.