Topic: Vlad "plots" aginst best freind scammer Matthew N. Wright - page 3. (Read 9055 times)

Thanks D&T, that's exactly the sort of clarification I was looking for.

Any payment can be "voided" if allowed by statute (in the US it is 90 days prior to the BK petition).  However it is rare for personal payments to be voided.  

An example of a common BK. Someone is in debt (lots of creditors - multiple CC, a signature loan, a loan on a jet ski, loan on car, student loan, mortgage etc).   They get into financial trouble and the liabilities are more than the income.  This person decides to forget the jet ski, CC, and signature loan.  They use the little income they have each month to keep making payments on their mortgage and car note. Technically the trustee could void the prior 3 mortgage and car payments, return that cash back to the bankrupted estate and divide it among creditors.  In 99.9% of the cases the trustee won't.  It is human nature to try and save your home.  The debtor hasn't done anything which indicates that he is trying to defraud anyone. 

Another example.  Same debtor as above but he has $10,000 in gold coins.  He decides to sell the gold coins to his brother for a lawn mower worth ~$100, 90 or less days before the BK petition.  The trustee would likely void this payment.  The gold would return to the estate.  The brother would become a secured creditor and could either seek to get his lawn mower back or get fair market value on a prorated basis with other creditors.  It is quite obvious the intent of the sale was to defraud the creditors.

In the real world most cases fall in between those two.  Just because a trustee "can" void a payment doesn't mean they always will. There is no absolute rule, or "line in the sand".  Generally speaking trustees use common sense to determine an equitable arrangement. There are far too many unique situations for the law to specify in black and white how to handle every situation.

Yes please.

OT: At least Matthew was intelligent enough to be entertaining. Goat is just goat, as usual.

Meh, I trust Vlad less than I trust Matthew.

To confirm, those payments can be reversed even in the case of personal bankruptcy?

It would be up to the court and the bankruptcy trustee to sell or transfer that equity for the benefit of the creditors. There may be restrictions of the sale of the equity that would give the remaining shareholders first rights, options to purchase etc. This type of agreement is not uncommon in business startups. As for payments to a creditor by a debtor in anticipation of bankruptcy, these can be reversed in many cases by the other creditors.

Ok, so here's a question:

In the event of a MNW bankruptcy, and assuming he still held partial equity in Bitcoin Magazine, what would happen to that equity?  Would it be sold by the state at auction?  Would it be offered for buyout to the other shareholders at the highest bid price?  Would it be distributed to the creditors?

Also, are individuals treated the same as corporations when it comes to bankruptcy?  If a person is known to be bankrupt soon, then they shouldn't pay anyone, but save what they have to be distributed to the creditors evenly?  I've never heard of that happening in a personal bankruptcy case, so it just seems odd to me... I've never heard of anyone not being able to choose who they want to pay right up to the point that they make the official declaration of bankruptcy.

As long as Bittalk Media Ltd. does not in any way allow this to influence their relationship with Matt with respect to Matt's stock yes. Otherwise there can be serious problems.

I tend to disagree again. This is solely a PR deal to minimize damage to the companies reputation.

Companies do this all the time to people wronged by one of their staff members.

But I'm not completely sure this time. Might be a problem, but I don't think so.

As long a Matt does this of his own free will and without duress, yes of course. Now what exactly is the "leverage" that Bittalk Media Ltd. has here?

I missed that but I still don't see how BitTalk is liable for anything.  If Matt choses to trade some of his liabilities for the equity in BitTalk that is his choice.  If he is insolvent (legal definition) and seeks bankruptcy then the tx could be voided but there is legal consequence.  BitTalk could take a loss (in theory) but the odds of all that happening are essentially nil.

That may be true, although one interesting way of looking at this is that Matthew was actually peddling an insurance product rather than a gambling wager as classically understood. I don't have all the transcripts of what exactly Matt himself said, but there was certainly a lot of discussion about this being a way to hedge a Pirate default.  Financial insurance products such as credit default swaps and even classic insurance are all "bets" in a way between those exposed to risk and those offering an offset.

So it may be that for many Matthew bets, there was no skin in the game, and it was just a wager on the sideline about whether Pirate will pay, just like whether Liverpool will win.  But for those holding Pirate debt and looking for a hedge, this contract worked more like insurance and, depending on what Matthew said about it, might be more solid in terms of a liability in legal proceedings.  Maybe.

Well both can't be true.   Matt can sell his equity for a fart in a bag if he wants to. 
So either there is a liability recognized by the court(s) or no legal problem will rise from it.

I actually tend to agree that any liabilities arising from this bet are very likely worthless. It is what is been proposed in exchange for these "liabilities" that can lead to very serious and complex legal problems.

No there will be no legal consequences. Bets from private persons to private persons are not accountable. There is no single case where any curt has seized someone's property due to a bet.

On a betting office you make a contract or buy a batch. That's a different thing.

Bold on the Chaang Noi (Goat) ช้างน้อย quote my emphasis. It is Bittalk Media Ltd, who is liable here. What we are talking about here is a corporation turning over some of its shares held in trust for one of its shareholders in exchange for some very questionable liabilities of the shareholder, without a right of offset, with multiple international jurisdictions involved and where the shareholder in question is at risk of bankruptcy! Talk about a legal hornets' nest. The legal fees to clean up this mess alone can easily bankrupt many a business start up.

A good rule of thumb is to assume anyone with a "VIP" is a scammer

This.

It seems to me that Vlad is trying to reduce the impact of MNW's scam on MNW and perhaps on Bitcoin Magazine.

In theory but i don't see how you think it could bankrupt BitTalk.  BitTalk has no liability regardless. At most it could cause a personal loss to Vlad but even that is unlikely.  For those who are interested the concept is called voided debt.  First (at least in the US) only payments made 90 days prior to a bankruptcy petition can be voided.  


Lets say hypothetically Vlad buys up 40K BTC of Matts debt (the risk to the company is lower the more of the debt he owns).  He buys Matt's share of BitTalk for 40K of debt.  Note BitTalk the legal entity isn't a creditor or debtor in the situation.  The sale (if any) would be between Matt & Vlad.  Now hypothetically Matt files bankruptcy in the next 90 days.  Technically other creditors in the bankruptcy could move to void the payment (of equity) between Matt & Vlad.  


I would point out this is a legal longshot and probably not one worth worrying over. One Matt is almost certainly not filing for bankruptcy over this.  No bankruptcy no risk of voided payment.  Two it is very unlikely the courts would see an online gambling debt made by pseudonyms involving a virtual currency on an unregulated forum as a valid creditor in the bankruptcy.  If they don't then they other bettors have no method to petition the payment be voided.

Even if those things happen (and if I was Vlad I would like my odds) the company has no liability this is just a sale of equity between one shareholder and another.  The company neither gains nor loses in that transaction. 

Given the limited loss even if the grossly unrealistic worst case scenario (and honestly I am not recommend anyone hold on to their debt thinking this will happen because it won't) I don't really see there being much of a realistic risk for Vlad.