Court Calls Divorce Asset Distributions A Fraudulent Transfer

Jon Alper Fraudulent Transfers

Often, clients facing a significant judgments ask me whether they should divorce their spouse for asset protection. They consider a legal divorce in which their non-debtor spouse would receive all of the debtor’s non-exempt assets. The issue is whether a court’s divorce decree immunizes the debtor and his ex-spouse from fraudulent transfer actions.

Fraudulent Transfer to Nevada Asset Protection Trust

Jon Alper Fraudulent Transfers

Fraudulent transfer law casts a big net, and courts will undo almost any transfer that is clearly intended to avoid present or even future unknown creditors. In this case, a California appellate court reversed a transfer of assets to a Nevada asset protection trust four years prior to a creditor’s lawsuit being filed.

Can U.S. Government Be Sued For Receipt of Fraudulent Transfer?

Jon Alper Fraudulent Transfers

Here’s is an interesting case where a bankruptcy trustee sued the U.S. government for their receipt of a fraudulent transfer. Within two years of filing bankruptcy a company, taxable as an S-Corp, paid the IRS money to satisfy their owners’ tax liability attributable to company income. The bankruptcy trustee argued that these tax liability payments were fraudulent transfers, and he …

Transfers To Your Spouse Likely Reversed As Fraudulent Conveyances

Jon Alper Fraudulent Transfers

This Connecticut case caught my attention, not because it establishes new law, but because it addresses a common asset protection mistake. Many of my new clients believe they may protect their assets by simply transferring non-exempt assets to their non-debtor spouse. As this case illustrated, the answer is almost always, “no”.

Bankruptcy Court Says No Claims Permitted For Conspiracy or Aiding And Abetting Fraudulent Transfers

Jon Alper Fraudulent Transfers, Uncategorized

A recent bankruptcy court decision addressed the issue of whether people who assist a debtor’s pre-bankruptcy fraudulent transfers can be held liable for damages in the bankruptcy proceeding. In this case, a trustee hired to liquidate debtor property filed a complaint pursuant to Section 544(b) of the Bankruptcy Code against a group of people for conspiring with the debtor to …