QUORUMCALL//GPT:
Democratic Senator Elizabeth Warren is pushing for a crackdown on the so-called “two-step” bankruptcy strategy, which she claims large corporations use to dodge accountability.
TURNING THE SPOTLIGHT
• Warren, alongside Representative Jerrold Nadler, has introduced the Suspend Act to Congress. The bill aims to prevent corporations from moving their assets prior to filing for bankruptcy.
THE BIGGER PICTURE
• The “two-step” strategy involves creating a new subsidiary company and transferring the assets to it before declaring bankruptcy. This allows the parent company to avoid legal responsibility for its debts. Warren argues that this practice allows corporations to dodge their obligations and leaves creditors, employees, and taxpayers to foot the bill.
TOPICS COVERED
#Bankruptcy #CorporateAccountability #SuspendAct
The article is from Bloomberg Law, a reliable source for legal and business news.