The court-appointed receiver overseeing recovery of assets for Allen Stanford's massive $7 billion Ponzi scheme has filed a lawsuit seeking the return of more than $500,000 donated by Stanford to charitable organizations headed by golfer Tiger Woods. Ralph Janvey, the court-appointed receiver, filed suit against the Tiger Woods Foundation and the Tiger Woods Charity Event Corp. (the "Woods Entities") in a Texas federal court, alleging the entities received fraudulent transfers of $502,000.
The "clawback" suit, as it is known, seeks the return of funds that were transferred to a third party. Under state-specific fraudulent transfer laws patterned after the Uniform Fraudulent Transfer Act, a creditor can seek to avoid a transfer made by a debtor to a third-party under several theories, including that the transfer was made with the intent to hinder, delay, or defraud creditors, or the debtor did not receive reasonably equivalent value for the transfer. While a showing of actual fraud is not required and can be demonstrated through other factors, transfers made from a Ponzi scheme are presumptively made with the intent to defraud due to established law that a Ponzi scheme is insolvent from inception as a matter of law.
The suit against the Woods Entities alleges both actual and constructive fraudulent transfer theories, as well as theories of unjust enrichment and constructive trust. Janvey has filed hundreds of clawback lawsuits against both investors that profited from the scheme and third parties that received investor funds, including political parties.
For more news and analysis of Ponzi schemes, visit Ponzitracker, a blog by Jordan Maglich, an attorney at Wiand Guerra King P.L.
For more information about LexisNexis products and solutions connect with us through our corporate site.