The U.S. Trustee Program wants a bankruptcy court to strip law firm Kaye Scholer LLP and financial adviser Capstone of more than $10 million they earned through the bankruptcy of investment management firm GSC Group Inc., Reuters reported yesterday. The firms covered up key business relationships that may have served to inflate their fees, according to court papers filed on Friday by the U.S. Trustee Program. GSC, founded by former Goldman Sachs Group Inc partner Alfred Eckert III, declared bankruptcy in August 2010, hampered by a liquidity squeeze and declining asset values brought on by global recession. The case in U.S. Bankruptcy Court in Manhattan culminated in the 2011 sale of GSC's assets to lender Black Diamond Capital Management.
