A U.S. trustee is suing the wife of William Nicklin for allegedly helping the bankrupt Newburgh investment adviser shield assets from creditors.
Nicklin allegedly formed Riverlife Investment Holdings to place his property beyond the reach of creditors, according to four complaints filed in U.S. Bankruptcy Court, Poughkeepsie.
“Nicklin regularly commingled his personal assets with those of Riverlife,” court-appointed trustee Daniel Ventricelli argues in the complaints, “and strategically shifted assets back and forth between his accounts and those of Riverlife in an attempt to shield his personal assets” from creditors.
Nicklin”™s bankruptcy attorney Michelle Trier responded in an email that he “will continue to defend himself against the unsubstantiated allegations asserted by the trustee.”
Nicklin managed as much as $1.2 billion in assets at NSB Advisors in Fishkill from 2009 to 2015. He was a sophisticated trader, according to Ventricelli, but he employed an aggressive strategy. During one six-month period, he lost $40 million.
Nicklin relied heavily on margin credit, borrowing money from his broker, C.L. King & Associates, to buy securities. When the value of his securities declined dramatically, C.L. King demanded that he put more cash or assets in his account. Nicklin refused.
C.L. King took the dispute to arbitration. In 2017, Manhattan Supreme Court confirmed a $16.2 million arbitration award.
NSB Advisors failed in 2015. In 2019, Nicklin personally petitioned for Chapter 7 liquidation, declaring $10.3 million in assets and $16.4 million in liabilities. Creditors are currently claiming $60.2 million in debts.
Nicklin acknowledged the arbitration debt, but according to Ventricelli he concealed significant assets.
Nicklin formed Riverlife in 2011 and transferred his “less risky” assets to the company, according to the trustee. He allegedly made his wife, Velda Adah Nicklin, a 50-50 partner, for no financial consideration.
Then he created an annuity trust and granted 90% of their interests in Riverlife to the trust.
Ventricelli previously accused Nicklin of transferring assets to his sons, daughters-in-law and grandchildren, to place assets beyond the reach of creditors.
He said in the new complaints that in 2012 Nicklin transferred $2.5 million to his wife, for no consideration, and from 2015 to 2017 moved another $382,000 to a joint checking account.
The later transfers were allegedly used for country club dues, an annual trip to Scotland, and ownership and maintenance of a vacation property in Hilton Head, South Carolina, “while Nicklin owed C.L. King millions of dollars.”
The new complaints also name Anthony Pascale, his wife”™s cousin and the trustee of the annuity trust; Blockbridge Networks; Last Resort Holdings; and Nicklin Holdings.
Ventricelli wants the court to invalidate the annuity trust and declare the assets as bankruptcy property for the benefit of creditors. He argues that the transfers and transactions between the various defendants were fraudulent and also should be canceled.
Manhattan attorney Alec P. Ostrow represents Ventricelli.
