Crying Fraud, Banks Seek Ch. 7 For Specialty Lender

Law360, Chicago (April 30, 2013, 4:11 PM EDT) -- Three banks owed nearly $63 million, led by Israel Discount Bank of New York, moved Monday to force Oak Rock Financial LLC into Chapter 7 liquidation, claiming the specialty asset-based lending firm has committed a “massive fraud” against its secured lenders.

In the span of two weeks, the Bohemia, N.Y.-based firm’s founder and manager John P. Murphy has resigned and disappeared, while his replacement revealed the alleged fraud to the lenders but pointed the finger at Murphy, IDBNY said in court papers filed in New York...
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