Question

1. Briefly what is a fraudulent transfer in a bankruptcy case?

Answer 1

A fraudulent transfer can occur when someone knowingly transfers property ownership in an attempt to reduce the amount a creditor will get in a bankruptcy case. It can also happen when someone innocently sells property for less than it’s worth. fraudulent transfer, is an attempt to avoid debt by transferring money to another person or company. It is generally a civil, not a criminal matter, meaning that one cannot go to jail for it, but in some jurisdictions there is potential for criminal prosecution.

Types of Fraudulent Transfers----------

• transferred property to a third party with the intent to defraud (not pay) a creditor, or
• transferred property for less than what it’s worth

1. Recognizing Actual Fraud-----------The first type of fraudulent transfer involves actual fraud. It happens when you sell, give away, or otherwise transfer your property to someone else with the specific intent of keeping it out of the hands of your creditors.

2. Selling Property Cheap ------------

The second type of fraudulent transfer involves transferring property to someone else for less than it’s worth. Even though this is also considered a fraudulent transfer, it doesn’t necessarily involve an intent to defraud a creditor.