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Southwest Exchange

Case Conclusion Date: 02.02.2009

Practice Area: Tax

Outcome: Recovered over 91 Million

Description: Southwest Exchange, Inc. was a Nevada corporation operating as a 1031 exchange as a "qualified intermediary," or "1031," a tax deferred property exchange set up by the company to assist with 1031 exchanges. Under the tax rules, a person or entity could sell an investment of real property and reinvest that money in new, like-kind property within a 180-day period. Capital gains taxes on profits from the sale of the real property were deferred. The Principle owners transferred funds of over 100 Million Dollars out of the company's accounts without written permission of Southwest's exchange clients. This permission is required by Nevada law. The Judge ordered a Receiver to assist in the return of the funds. Mr. Randolph represented the Receiver, Mr. Larry Bertsch

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