USFIA victims are one step nearer to distribution funds, following the Receiver’s filed plan of distribution.
The USFIA Receiver’s plan was filed on December seventh, the day after BehindMLM reported $45.2 million in USFIA sufferer claims had been authorised.
As per the Receiver’s memorandum supporting the proposed plan, there may be an estimated $65 million to be distributed to USFIA victims with allowed claims.
On the floor this appears like a 100% restoration with surplus, nevertheless as soon as Amkey/Vecast and Apollo REIT claims are factored in, the whole allowed claims quantity is $80.7 million.
Amkey/Vecast and Apollo REIT have been a part of the fraudulent entities Steve Chen ran together with USFIA.
Investor funds have been commingled between Chen’s numerous scams, courting again to 2004. As per forensic accounting nevertheless, solely claims pertaining to funding made after January 2010 are eligible for processing.
This is because of ‘all the cash recovered for distribution is tied to investments made and belongings acquired after January 2010.’
Seems that by the point BehindMLM reviewed USFIA in 2015, Chen had already been defrauding buyers for over a decade.
One other fascinating tidbit is that after USFIA was shut down, Chen and his associates went on to launch ALCoin and Fortunate Coin (I imagine these have been focused at mainland China buyers as reload scams).
Each of those Ponzi schemes failed however seeing as they’re not Receivership entities, claims from victims of the schemes are disallowed.
Different disallowed claims of word embody:
- Kim R Holland – USFIA insider who hosted firm occasions, rejected $8000 declare
- Mo Chen – Certainly one of Steve Chen’s sons and an apparent USFIA insider, rejected $413,531 declare
- Steamfront Funding Group – a USFIA insider filed a declare on behalf of what’s now a Receivership entity, rejected $2.07 million greenback declare
- Ally Buyers – a USFIA insider filed a declare on behalf of certainly one of Chen’s rip-off corporations, rejected $3.03 million greenback declare
The Receiver’s proposed plan additionally offers an replace on the continuing potential USFIA tax liabilities.
The Receiver should look ahead to the Inner Income Service (“IRS”) and the Franchise Tax Board (“FTB”) to overview the tax returns and decide their respective positions earlier than the end result is definite and distributions might be made.
The Receiver states
if the IRS and FTB settle for the returns as filed, there needs to be little to no revenue tax legal responsibility from these returns.
Nonetheless, the Receiver can’t assume that the taxing authorities will agree with the Receiver’s tax positions and settle for the returns as filed.
As well as, there could also be different revenue tax points past the returns filed by the Receiver, together with points arising out of returns filed by Mr. Chen or different entities Chen shaped or that are in any other case related to the fraudulent scheme.
Sadly there doesn’t look like a timeline on how lengthy the IRS and FTB evaluations will take.
Pending decision of USFIA’s potential tax liabilities and courtroom approval of the Receiver’s proposed distribution plan, keep tuned…
Replace twenty seventh February 2021 – The USFIA Receiver’s proposed distribution plan was authorised on February 18th, 2021.