Receiverships and Other Shark Tales

Abstract

Receiverships are the Federal Trade Commission's way to shut down scams, using court-appointed receivers to marshal assets and to identify, preserve, analyze, and forensically copy electronic information to develop evidence of fraud. Each receivership has its own story, and each story has important lessons for all litigators — not just those litigating with the FTC or agencies with similar authority such as the Securities and Exchange Commission (SEC) or the Commodities Futures Trading Commission (CFTC). Even litigators dealing with bankruptcy fraud or electronic discovery outside the context of regulatory agencies can learn from receivership stories. This article details the statutory provisions relating to the imposition of receiverships under the FTC Act and issues that can arise when cases are litigated.