The Madoff scandal has demonstrated that receivers appointed on behalf of troubled funds that were actually or allegedly run as Ponzi schemes can aggressively pursue legal action to recover funds misappropriated from investors.  See “Two Recent Federal Court Decisions Clarify the Differing Treatment under SIPA of Returned Principal and Fictitious Profits,” Hedge Fund Law Report, Vol. 4, No. 34 (Sep. 29, 2011).  To date, receivers continue to aggressively pursue such actions.  This article outlines the approach recently taken by a federal court in determining when a fraudulent transfer has been made to a service provider from persons that have operated a Ponzi scheme.