Texas Justices Ponder 'Good Faith' In $79M Clawback

Law360 (October 8, 2019, 7:21 PM EDT) -- Texas Supreme Court justices on Tuesday questioned whether a Stanford International Bank Ltd. investor who suspected fraud but didn't report it before a $7 billion Ponzi scheme unraveled could be deemed to have acted in good faith and avoid returning about $79 million he withdrew from the bank.

The Fifth Circuit had asked the Texas justices to weigh in on what "good faith" means as it relates to the Texas Uniform Fraudulent Transfer Act, in a dispute that pits the court-appointed receiver for the Stanford fraud against Gary D. Magness, who pulled the money from his account at the bank a few months after...

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