Immediate Transferee

The transferee from the initial transferee. The second transferee, and in contrast under the Code to an “initial transferee” (the one who received the transfer directly from the debtor) and a “mediate transferee” (who is third in line or beyond and who received a transfer from the immediate transferee or from a preceding mediate transferee).

The classification is relevant in terms of the defenses available to the transferee of an avoidable transfer. An immediate or mediate transferee, but not an initial transferee, may escape liability if it took the transfer for value, in good faith, and without knowledge of the voidability of the transfer.

Bankruptcy Code § 550(a)(1), (2). See also Avoidable Transfer, Avoidance Action, Initial Transferee, Mediate Transferee, Subsequent Transferee.

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