Creditors of fallen energy giant Enron have laid claim to $12m which confessed fraudster Michael Kopper has admitted to obtaining illegally while an executive at the firm.
The creditors, who believe they are owed $50bn by Enron's collapse, filed a lawsuit late on Monday at a federal bankruptcy court, stating their right to the money.
Mr Kopper who pleaded guilty last week to charges of money laundering and fraud conspiracies, had agreed to turn over the cash to US authorities, with $4m earmarked for the US Justice Department and $8m to the Securities and Exchange Commission.
The case is set to be heard on Wednesday before US bankruptcy judge Arthur Gonzalez.
Luc Despins, lead lawyer for the unsecured creditors' committee, said: "Kopper basically admitted that he took the money from Enron, so it's Enron's money.
The SEC said it would respond to the suit in the court, while the Justice Department said it did not anticipate making a filing.
Mr Kopper has agreed to help prosecutors build their cases against other executives, and faces fines of up to twice the amount of money he took illegally, plus 15 years in prison, in addition to the disputed $12m.
A former employee in Enron's global finance unit, he has admitted defrauding Enron of at least $12m through work on three secretive partnerships, which he claims to have managed with the help of former chief finance officer Andrew Fastow.
The partnerships are seen as central to the collapse of Enron in December, a bankruptcy which cost about $68bn in market value, 5,000 jobs and $800m in employees' pension investments.
Mr Kopper's admissions represented the first success in efforts to bring criminal charges against former Enron executives.
Hit list Mr Fastow is alleged to have made more than $30m from investments in the partnerships.
Court papers have shown that the government is seeking to seize two Fastow family bank accounts holding $9.1m, plus a further account, held in the name of a family foundation, containing $4.6m.
Prosecutors are also attempting to obtain a home Mr Fastow is building in the affluent River Oaks quarter in Houston.
The government has also targeted former Enron lawyer Kristina Mordaunt, seeking bank accounts holding more than $1.6m, her home and a Lexus owned by her husband.
More than $900,000 is sought from former Enron Treasurer Ben Glisan Jr.
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