Who is a “Non-Statutory Insider” for Purposes of Determining Whether a Payment Was Preferential in Bankruptcy?
Foster Swift
MAY 18, 2020
One of the objectives of the Bankruptcy Code is to ensure that each class of creditors is treated equally. And one of the ways that is accomplished is to allow the debtor’s estate to claw back certain pre-petition payments made to creditors. Accordingly, creditors of a debtor who files for bankruptcy are often unpleasantly surprised to learn that they may be forced to relinquish “preferential” payments they received before the bankruptcy filing.
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