Section 546(e) of the Bankruptcy Code is a safe harbor provision that establishes that a trustee or debtor-in-possession may not avoid a transfer “by or to... a financial institution.. in connection with a securities contract” other than under an intentional fraudulent conveyance theory. On December 19, 2019, the Second Circuit in Note Holders v.

There is currently a split in authority on the issue of whether a trustee may recover from an immediate or mediate transferee if the recipient received proceeds from a fraudulent transfer but not the fraudulently transferred property itself.