Quote:
Originally Posted by DavidNB
They may give owners the chance to return dividends they approved for themselves knowing the company could not afford it. But i suspected that shareholders who received payment may not be required to return them
I disagree, and here's why.
Salary will not be clawbackable. But members of the LLC receiving dividends is not salary, it's return on investment (even if no capital contribution was necessary upon being made a member of the LLC). This isn't "shareholding" in the way you buy stock in IBM over the NYSE, and those aren't the applicable rules.
This situation now is much more akin to how the Madoff trustee was able to successfully claw back money from Madoff investors who Madoff actually gave distributions to (e.g., the owners of the New York Mets). The Wilpons did not cause the Madoff scheme to run afoul of the law, but they earned dividends from Madoff, and thus benefited from the illegality, in the same way that all the minor owners of FTP did.