Debt Collection Blog

"Relentless Collection Attorneys"

Alan Cohen

What are Preference Actions?

Sometimes, creditors are subject to a bankruptcy preference actions

A preference can occur when a debtor pays one of its creditors within 90 days of the debtor’s filing for business bankruptcy. Bankruptcy trustees can then attempt to claim that the debtor’s payment was preferential, and/or fraudulent. The end result is that a creditor can be told to return the payment for redistribution amongst all the creditors waiting for payment.

 Fighting Against Preference Actions

In the case of a preference action, the burden of proof is borne by the bankruptcy trustee. He or she has to show that the payment received within the 90 day period would allow the creditor to receive more than they would through the bankruptcy proceedings. There are statutory defenses to a preference action set forth in the Bankruptcy Code.

The Law Offices of Alan M. Cohen LLC defends and negotiates preference actions to get good results for our clients. With our signature relentlessness, we work to minimize the liability of our client to the bankruptcy estate. Attorney Cohen and our creditors’ rights attorneys will work to determine factors such as whether the debtor made the payment as part of ordinary business and/or received new value for it, their payment history, and other information that can be used to mount a successful defense. We protect and defend the rights of creditors using our skill, experience, and legal knowledge.

Working with the Law Offices of Alan M. Cohen

Having the money you were owed finally paid, only to then face a preference action can be incredibly frustrating for a creditor. You deserve the money that you are owed. If you face a preference action or the threat of a preference action, you may be tempted to just pay the money back, but this is not always necessary when you have an experienced attorney on your side.

Give yourself the best shot at keeping your owed funds by hiring the Law Offices of Alan M. Cohen LLC. Don’t give up. Consult with us to find out what we can do for you.

To find out more about how we can assist you in a preference action case or other commercial collection matter, contact the Law Offices of Alan M. Cohen LLC today at (508) 620-6900 or

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