The Trustee sought court approval of an amended bankruptcy proposal, supported by the debtor and a major creditor, which would provide a 12.42% dividend to unsecured creditors funded primarily by the debtor's family.
The Office of the Superintendent in Bankruptcy opposed the approval, citing the debtor's lack of disclosure, failure to answer questions regarding the use of loan proceeds, and potential involvement in fraud.
The court refused to approve the proposal, finding that the debtor had not acted in good faith and that approving the proposal would compromise the integrity of the bankruptcy system.
