PRESS RELEASE: AFX and Bankruptcy Trustee of Gallant Capital Markets Reach Settlement

PRESS RELEASE: AFX and Bankruptcy Trustee of Gallant Capital Markets Reach Settlement
May 18, 2019
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The bankruptcy trustee of Gallant Capital Markets and AFX recently reached a settlement where the defendant will pay $83,000 as the full and final payment for any claims. The trustee has accepted it as a fair settlement on part of AFX.

How is the case progressing?

The case brought by the Chapter 11 trustee of Gallant Capital Markets Ltd. is progressed recently and approached a settlement . The case was brought against AFX Capital Markets Ltd, AFC Capital US Corp., and STP Super Trading Online.

According to the complaint, Gallant deposited about $2.35 million with AFX throughout 2015 and 2016 for its benefit. The account where the money was deposited was being maintained by AFX. Two weeks before Gallant started its bankruptcy case, the AFX account had a balance of $2.4 million. During this time, Gallant made several requests to AFX to turnover its funds. However, the defendant disregarded the requests.

AFX went on to withdraw the remaining balance without basis and without authorization on the Filing. Their actions violated the automatic stay. The Gallant trustee sought turnover of Gallant property as the recovery of assets of their estate. They also seek automatic stay enforcement.

Resolution is underway

The documents filed with the New York Eastern Bankruptcy Court today show that the parties are moving towards a resolution. Both the parties propose that a hearing shall be held on June 11, 2019, at 10 am or as soon thereafter before the Honorable Elizbeth S. Stong, United States Bankruptcy Judge, Eastern District of New York. The hearing will be on the motion of the Chapter 11 Trustee of the Gallant Capital Markets Ltd. and Avenica Inc., Esther DuVal.

DuVal will appear solely in her capacity as the bankruptcy trustee of the two jointly administered estate of debtors. The hearing shall seek entry of an Order that approves the stipulation between the two parties that will resolve the case proceedings. Objections to the relief request must be filed with the court before June 4 at 5 pm.

After months of negotiations, the parties have agreed that the defendants will pay a sum of $830,000 in full and final settlement of any and all claims of the trustee and debtors’ estates. The settlement sum will be paid to the trustee. DuVal also believes that it is a fair and reasonable settlement on part of AFX and is ready to accept the amount.

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