4th Circ. Says Fallen Co. Can't Seek $161M In Wachovia Funds

Law360, New York (May 28, 2013, 2:04 PM EDT) -- A bankrupt investment firm can't recover $161 million worth of securities that its customers transferred to Wachovia before it collapsed because the money isn't the firm's to recover, the Fourth Circuit ruled Friday.

Derivium Capital LLC, which collapsed after a stock loan lending program it ran — allegedly a Ponzi scheme — fell apart, had held customer accounts at Wachovia, which itself has since collapsed and is now part of Wells Fargo & Co.

Grayson Consulting Inc. sued in 2007 on behalf of Derivium's bankruptcy trustee,...
To view the full article, register now.