Bankruptcy Code Section 550(a)(2) Lacks Extraterritorial Reach: SDNY | Practical Law
In Securities Investor Protection Corp. v. Bernard L. Madoff Investment Securities LLC, the US District Court for the Southern District of New York held that because section 550(a)(2) of the Bankruptcy Code may not be applied extraterritorially, the trustee may not recover funds transferred from foreign investment funds to their foreign customers.