Hearing on settlement in AFX Capital case set to be postponed

Maria Nikolova

The hearing dedicated to the proposed settlement between AFX Capital and the Chapter 11 Trustee of Gallant Capital Markets Ltd is set to be adjourned to July 2, 2019.

Nothing seems to be happening fast when it comes to the lawsuit brought by the Chapter 11 Trustee of Gallant Capital Markets Ltd. against AFX Capital Markets Ltd., AFX Capital U.S. Corp. and STO Super Trading Online.

Even after the parties in the case announced that a settlement has been reached and scheduled a hearing so that the Court may approve the proposed stipulation, another delay in the proceedings looms. The hearing, originally scheduled for June 11, 2019, is set to be shifted to July 2, 2019. This becomes clear from a Letter filed with the New York Eastern Bankruptcy Court.

The text of the Letter is pretty formal and does not provide any details as to the reasons for the adjournment:

“This letter is to confirm the adjournment of the pre-trial conference in the above- mentioned adversary proceeding and the motion to approve the Trustee’s Stipulation with the Defendants, on consent of Defendants’ counsel, from Tuesday, June 11, 2019 at 10:00 a.m., to Tuesday, July 2, 2019 at 9:30 a.m”.

Let’s recall that, under the Complaint against AFX, throughout 2015 and 2016, Gallant deposited approximately $2.35 million (for its benefit) into a Gallant account maintained at AFX. Within the two-week period prior to Gallant’s commencement of its bankruptcy case, there was a balance of approximately $2.4 million in the Gallant account at AFX. Around that time, Gallant made multiple demands upon Defendants for the turnover of Gallant’s funds—all of which were disregarded.

Nevertheless, AFX withdrew the remaining balance, without authorization and without basis, on the Filing Date—in violation of the automatic stay. This case involves core issues whereby the Trustee is seeking a turnover of Gallant property and recovery of assets of the Gallant estate, and enforcement of the automatic stay.

Under the terms of the proposed settlement, the defendants will pay the sum of $830,000 in full and final satisfaction of any and all claims the Trustee and the Debtors’ estates have or may have. The Settlement Sum is to be paid to the Trustee, on behalf of the Gallant estate. The Trustee believes the settlement sum is fair and reasonable and in the best interest of the estate.

Read this next

Retail FX

FF Simple and Smart Trades says Goodbye to CySEC authorization

The Cyprus Securities and Exchange Commission (CySEC) confirmed that it has wholly withdrawn the Cyprus Investment Firm (CIF) licenses of FF Simple and Smart Trades Investment Services Ltd.

Crypto Insider

Shining the Light in Crypto’s Dark Places

Something changed in regulators’ minds after the November crash of the FTX crypto exchange.

Executive Moves

Financial Commission Adds Sam Low to Dispute Resolution Committee

The Financial Commission (FinaCom PLC), a dispute resolution service that caters to the financial services industry, has appointed Sam Low as the newest member of its Dispute Resolution Committee (DRC).

Digital Assets, Uncategorized

De-facto owner of Bithumb exchange arrested in South Korea

South Korean prosecutors have arrested Kang Jong-Hyun, the anonymous chairman and owner of the country’s largest cryptocurrency exchange, Bithumb, on charges of embezzlement and stock manipulation.

Retail FX

Interactive Brokers volumes snap three-month losing streak

Electronic brokerage firm Interactive Brokers LLC (NASDAQ:IBKR) said its trading volumes rose in January, an indication that investor confidence in the financial markets is rebounding after having been fairly mixed over the past few months.

Digital Assets

VVF invests $5 million in Everscale, a potential Layer 2 solution for Venom blockchain

“For us, this is a strategic investment aimed at the technological development of projects and teams around technologies that we focus on and actively develop. In particular, we are talking about the Venom blockchain project and its ecosystem, which is planned to be launched soon and for which Everscale is a potential Layer 2 solution.”

Institutional FX

FXSpotStream volume ends string of declines on January rebound

Trading volumes on institutional FX platforms surged in January as traders increased their bets on central bankers’ policy with evidence mounting that inflation and economic growth are both losing momentum.

Industry News

DeFi firm Aurox launches SEC-compliant crowdfunding campaign on tZERO

“This is a great opportunity for us to raise capital from our community and the broader public on a leading fully regulated platform. We are confident that the tZERO Markets platform will provide us with the exposure and reach we need to attract a diverse investors to support our business growth.”

Industry News

Morgan Stanley launches ETF platform with six ESG-focused products by Calvert

“These new ETFs will resonate strongly with investors who seek competitive investment results while promoting positive change and supporting companies that are leaders in improving long-term shareholder value and societal outcomes.”

<