A senior federal judge in New York has restricted the movement of more than $1 million held in a U.S. bank account connected to Zia Chishti, the former head of a software investment firm, after finding evidence that money transfers were designed to shield assets from a court-confirmed arbitration award.
U.S. District Judge Jed S. Rakoff ruled that Chishti and his wife, Sarah Jennifer Pobereskin, may not move $1.2 million held in a Bank of America savings account registered in Pobereskin’s name. The decision follows a determination that certain transfers were likely made to frustrate enforcement of a roughly $9 million arbitral award obtained by Chishti’s former company, The Resource Group International Ltd.
In a written opinion issued Monday, Judge Rakoff said the record supports a conclusion that Chishti acted with intent to hinder creditors when he moved nearly $700,000 into his wife’s account earlier this year. The court cited several indicators commonly associated with fraudulent transfers, including the involvement of a close family member and the lack of disclosure during post-judgment asset discovery.
The judge also examined a separate transfer of about $500,000 that entered the same account from a foreign company linked to Pobereskin. That payment, the court found, likely stemmed from earlier transactions involving Chishti that could be deemed constructively fraudulent.
Because the funds could otherwise be moved beyond the reach of the court, Judge Rakoff concluded that the company faced a real risk of irreparable harm without interim relief.
While the court barred any transactions involving $1.2 million of the account balance, it declined to freeze the account in its entirety. Judge Rakoff said the evidence at this stage did not establish that Chishti exercised full control over all funds held in his wife’s account, limiting the scope of the injunction accordingly.
An earlier temporary order had restricted all withdrawals while the court held an evidentiary hearing. The new ruling narrows that restriction to a defined portion of the funds.
The injunction stems from efforts to enforce a $9 million arbitration award issued earlier this year. The arbitration panel found that Chishti breached a preferred stock agreement with The Resource Group, a company he founded more than two decades ago. A federal court confirmed the award in June.
The underlying ruling also restricts Chishti from transferring certain equity interests connected to the company, subject to limited exceptions.
Chishti previously asked the court to vacate the arbitration outcome, arguing it was legally flawed. That request remains unresolved.
The case is The Resource Group International Ltd. v. Muhammad Ziaullah Khan Chishti et al., in the U.S. District Court for the Southern District of New York.
