BNP Paribas Exploited Propex: Creditors

Law360, New York (September 24, 2008, 12:00 AM EDT) -- Propex Inc.'s committee of unsecured creditors has accused bank BNP Paribas of exploiting the textile company by luring it into a credit agreement designed to bankrupt the debtor and strengthen the bank.

In January 2007, BNP engaged in a scheme to deplete the debtor’s resources and ultimately force a bankruptcy proceeding rigged to leave the company hamstrung and the bank enriched and in control of the debtor-in-possession financing, the complaint says.

BNP induced Propex to enter into an “onerous and inequitable” agreement — the second amendment...
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