Section 6.11 Insiders

• Library: Bankruptcy Practice (2007 Ed. + 2015 Cum Supp)

F. (§6.11) Insiders

The preference recovery period against insiders is extended to one year before the filing of the bankruptcy petition. 11 U.S.C. § 547(b)(4)(B). The term “insider” is defined in 11 U.S.C. § 101(31), but the list of categories of entities that are considered insiders is not exclusive. In re Hillside Park Apts., L.P., 205 B.R. 177, 184 (Bankr. W.D. Mo. 1997) (Koger, C.J.). Insider status is determined on a case-by-case basis through examination of the totality of circumstances and the creditor’s degree of involvement in the debtor’s affairs. In re Hydraulic Indus. Prods., Co., 101 B.R. 107, 109 (Bankr. E.D. Mo. 1989) (Barta, C.J.) (whether first cousins of officer were insiders was a question of fact).

A person qualifies as an insider if there is a sufficiently close relationship with the debtor that the person’s conduct is made subject to closer scrutiny than those dealing at arm’s length with the debtor. Hillside Park Apts., 205 B.R. at 184; In re Newcomb, 744 F.2d 621, 625 n.4 (8^th Cir. 1984)...