Those who lost money with PIWM and Nikolai Battoo already know there are several parallel proceedings pending in the courts, each trying to get money on behalf of investors. Last week, we reported that infighting had developed between the parties charged with recovering money for Battoo’s victims. Both the U.S. receiver and British Virgin Islands liquidator both claim rights to the $24 million sitting in the receiver’s hands. Unfortunately, each liquidator or receiver has its own constituency.
Just before Christmas, the U.S. counsel to the British Virgin Islands receiver demanded the court hold a status conference to determine who is entitled to some $24 million being held by the U.S. court appointed receiver. The SEC and U.S. Commodity Futures Trading Commission have appointed Robb Evans & Associates as their receiver. Their case is pending in a Chicago federal court. The Supreme Court of the Bahamas has a separate liquidation proceeding.
What’s the big deal? The U.S. receiver says it has collected $24,799,093. The BVI liquidator claims $24,422,038 of that money! That means out of almost $25 million recovered, just $337,000 is undisputed.
What does Robb Evans, the U.S. receiver have to say about this? Plenty!
In a December 18th letter, the receiver responded, “You have now identified as ‘disputed’ substantially all of the funds that the Receiver is currently holding… This position, if upheld, would end the receivership, leaving it unable to pay the bills of professionals in all corners of the world who have expended time and resources in unraveling the fraud.”
More importantly for PIWM and Maven victims, the receiver correctly noted that if the BVI liquidator were to be successful in taking control of the recovered assets, most investors would not see a penny of the recovered funds. “Victims throughout the world will be left without a distribution, while only those investors who invested directly into the existing EFG accounts – a privileged few – will receive payment,” said receiver’s counsel, Deborah Thorne.
The fight between receivers and liquidator gives some valuable insights as to the source of the $24 million recovered by the receiver. Specifically, the receiver claims much of the money came from Reed Smith assets, Whitebox, Newedge, Quantitative Global 3X Fund and the Quantitative Tactical Aggressive Fund.
U.S. District Court Judge Edmond Chang has given the BVI liquidator until January 14th to file a formal complaint and intervene in the case. That means likely delays before any investors see money from the receiver.
As a first step, if you lost money with Nikolai Battoo, Tracy Sunderlage or any of their funds, make sure to file claims with the receivers.
Depending on how Judge Chang rules, investors could see nothing or perhaps a few dimes on the dollar. While everyone who lost money should file a claim with the receivers, in our opinion, the best source of recovery is from the stockbrokers, investment advisers and insurance agents that sold these products. Unfortunately, time is quickly running out to file claims against brokers and other financial professionals.
Several victims have told us that they are waiting to see what the receiver will distribute. A small handful still believes that Battoo or their broker will miraculously find the missing millions. Don’t count on either scenario happening any time soon.
If you purchased your investment from a third party (like a stockbroker), give us a call. Financial advisers and agents are responsible for conducting meaningful due diligence on the products they recommend. Unfortunately, many of these “professionals” were more motivated by the high commissions these investments paid and did not act in the best interests of their clients.
We have teamed up with Chapman Law to pursue these claims against PIWM, Maven, Anchor Hedge Fund, First Fidelity, BC Capital and others who may be associated Nikolai Battoo and Tracy Sunderlage. We have successfully brought claims against insurance agents too.
If you wish to discuss fraud losses in general, contact the author at or by telephone at (414) 704-6731 (direct). Have a claim involving PIWM, Battoo, Sunderlage, Maven, Galaxy or Anchor? We can help!
Post by Brian Mahany, Esq.
Tagged: PIWM fraud, Maven fraud, Battoo fraud, Nikolai Battoo, Tracy Sunderlage