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RECENT DEVELOPMENTS
- Following the Texas Court's approval of the Trustee's settlement with the Receiver in a case in Texas, referenced below, the Trustee received funds totaling $621,900 in the first week of February. The funds are being held in the Trustee bank account. The Trustee expects additional funds from the settlement upon the sale of a house currently being marketed for sale by the Receiver.
- The Trustee filed a Status Report with the Court on January 26, 2010.
- On January 22, 2010, a Texas court approved the Trustee's settlement with the Receiver in a case in Texas. This follows the Bankruptcy Court's approval of the settlement on December 18, 2009. The transcript of the hearing in the Bankruptcy court can be read here.
- Among other things, the terms of the settlement provide for (i) a $365,000 transfer to the Trustee for the benefit of the Debtors' estates; (ii) a 35% interest in an approximately $734,000 that the Receiver expects to receive from an Offshore Account; and (iii) a 35% interest in the proceeds of a residence owned by Adley Wahab. In addition, the settlement reserves the Trustee's right to assert certain claims for up to 20% of future assets that the Receiver may recover, provided that the Trustee can demonstrate a connection between those assets and A&O investor funds.
- On January 20, 2010, the Trustee filed a complaint against AVIVA, a life insurance carrier, seeking a determination that a particular policy should be considered to be in-force in light of protections available under applicable bankruptcy laws. AVIVA has asserted that the policy has lapsed.
- On January 13-14, 2010, the Court heard evidence on issues related to the disputed November 13, 2009 trustee election. The Court has asked for further briefing from the parties, and has continued the issue until March 8, 2010. The Court will determine who will be the trustee, and until such a decision, Patrick Collins will continue to serve as the trustee.
- The Trustee has filed a complaint, seeking recovery of investor funds, against Brent Oncale, Russell Mackert, Adley Abdulwahab, Christian Allmendinger, A&O Life Funds, LP, A&O Life Funds Management, LLC, and Shepherd Capital Management. The complaint was filed on Thursday, January 7, 2010, and asserts that the defendants looted and misapplied the funds of investors, and that the 2007 sale of the fund company itself was a sham, with certain of the defendants still remaining in control of the company and fraudulently transferring funds to themselves.