Case Reference: #2024-NY-0187

Client profile: Italian textile manufacturer exporting premium fabrics to the US fashion industry. Annual revenue €45M.

Claim: $890,000 — accumulated across six invoices over a nine-month trading relationship. The first four invoices were paid on time. Invoices five and six were not. The debtor cited a "temporary cash flow issue" and requested 90 additional days. That was eleven months ago.

The situation

New York is simultaneously one of the best and worst jurisdictions for commercial debt recovery in the United States. The courts are sophisticated, the legal framework is robust, and enforcement mechanisms are powerful. The problem is that New York debtors know this too — and the sophisticated ones structure their affairs accordingly.

This particular debtor — a garment district importer with 30 years in the business — understood the collection playbook intimately. When the first demand letter arrived from the Italian manufacturer's US counsel, the debtor moved their primary banking relationship from JPMorgan to a smaller regional bank. When the second letter arrived — this time from a collection agency — they moved again, to a bank that doesn't maintain a New York branch.

The strategy is straightforward: garnishment orders under New York's CPLR Article 52 require a bank to be within the court's jurisdiction. Move the account to an out-of-state bank with no New York presence, and the garnishment order has nowhere to land. Elegant, legal, and effective against creditors who rely on standard enforcement playbooks.

What we found

Our New York team — which includes a former ADA from the Manhattan District Attorney's financial crimes unit — didn't start with the bank accounts. They started with the debtor's receivables. A garment district importer selling to US retailers has a predictable revenue pattern: purchase orders from department stores and fashion brands, shipped through established logistics channels, paid through established accounts.

The debtor had moved their banking. They hadn't moved their customers. The same retailers who'd been paying the debtor at JPMorgan were now paying the debtor at the new bank — and those payment obligations were attachable under New York law regardless of where the debtor banked.

We filed for a CPLR §5225 turnover order directing three of the debtor's largest retail customers to remit payments to a court-controlled escrow account. Simultaneously, we obtained an order of attachment against the debtor's accounts receivable — a mechanism that freezes incoming payments before they reach the debtor's account at any bank.

The debtor's attorney called within four days. His opening position was that the attachment was "overly aggressive." Our position was that moving banking relationships twice to evade garnishment was the more aggressive act. The judge, when consulted, agreed with the second characterisation.

Resolution

Settlement reached 51 days after our engagement. The debtor paid $845,000 in two tranches — $600,000 immediately and $245,000 within 30 days. The remaining $45,000 was waived as part of the settlement. Our client's financial controller noted that the Italian legal counsel they'd initially engaged had spent six months and €40,000 in fees without recovering a single dollar. The distinction, she observed, was that the legal counsel had been searching for bank accounts while we'd been following the money.

The New York intelligence note

New York's six-year statute of limitations on commercial debts (CPLR §213) provides more runway than most US states, but sophisticated debtors use that time to restructure, not to pay. The garment district, the diamond district, the import/export community along the Brooklyn waterfront — these industries have multi-generational expertise in managing creditor pressure. Standard collection approaches produce standard results, which in these sectors means below-average recovery rates.

Effective recovery in New York requires understanding the debtor's commercial ecosystem, not just their bank statements. A garment importer's most valuable assets aren't in their bank account — they're in their purchase orders, their inventory, their retail relationships, and their reputation on Seventh Avenue. Attaching those assets, or credibly threatening to, changes the debtor's calculation in ways that another demand letter never will.

New York is also uniquely effective for international creditors because of its courts' familiarity with cross-border commerce. Judges in the Southern District and the Commercial Division of the Supreme Court handle international disputes routinely. They're not intimidated by foreign contracts, multiple currencies, or complex corporate structures. For European creditors recovering debts in the US, New York is often the preferred filing jurisdiction — even when the debtor operates elsewhere.

If you're owed money by a New York-based entity and standard collection has stalled, the money hasn't disappeared. It's moved. Deploy our New York team to find it.