![]() Subsequent transferees may also be targeted, although they generally have stronger defenses than immediate transferees.Īlthough fraudulent transfer law originally evolved in the context of a relatively simple agrarian economy, it is now widely used to challenge complex modern financial transactions such as leveraged buyouts.įraudulent transfer liability will often turn on the financial condition of the debtor at a particular point in the past. In a successful lawsuit, the plaintiff is entitled to recover the property transferred or its value from the transferee who has received a gift of the debtor's assets. For example, where the debtor has simply been more generous than they should have or, in business transactions, the business should have ceased trading earlier to preserve capital (see generally, wrongful trading). It is important to note that the actual distinction between the two different types of fraud is what the intentions of the debtor were. Constructive fraud does not relate to fraudulent intent, but rather to the underlying economics of the transaction, if it took place for less than reasonably equivalent value at a time when the debtor was in a distressed financial condition. Actual fraud typically involves a debtor who as part of an asset protection scheme donates his assets, usually to an "insider", and leaves himself nothing to pay his creditors. There are two types of fraudulent transfer- actual fraud and constructive fraud. However, when a debtor prefers to pay one creditor instead of another, that is not a fraudulent transfer. Thus, if a transfer is made with the specific intent to avoid satisfying a specific liability, then actual intent is present. Overview Ī transfer will be fraudulent if made with actual intent to hinder, delay, or defraud any creditor. It is generally treated as a civil cause of action that arises in debtor/ creditor relations, typically brought by creditors or by bankruptcy trustees against insolvent debtors, but in some jurisdictions there is potential for criminal prosecution. Send us feedback about these examples.A fraudulent conveyance or fraudulent transfer is an attempt to avoid debt by transferring money to another person or company. These examples are programmatically compiled from various online sources to illustrate current usage of the word 'conveyance.' Any opinions expressed in the examples do not represent those of Merriam-Webster or its editors. Rachel Schilke, Washington Examiner, 23 Jan. 2022 The charges for the four defendants include conspiracy to defraud the United States conspiracy to convert, sell, convey, and dispose of government property and conversion, sale, conveyance, and disposal of government property and aiding and abetting. 2022 Modern efficiencies-0f space, weight, and energy-go unrecognized by this regal conveyance. Hayley Smith, Los Angeles Times, 23 Aug. 2023 The upgrade is just the latest instance of state and federal water managers struggling to maintain a complex and aging water conveyance system that is not only beset by drought, but also challenged by sagging canals, leaking pipes and the looming threat of wildfires and earthquakes. 2023 Walshe is charged with first-degree murder, misleading a police investigation/obstruction of justice, and improper conveyance of a human body, Morrisey’s office said in a statement. ![]() ![]() 2023 In addition to murder, Walshe was indicted on charges of misleading a police investigation/obstruction of justice and improper conveyance of a human body, according to a news release. 2021 Its behavioral envelope will probably suit many of those concerned with finding proper conveyances for their golden years of grand touring. Adam Elmahrek, Los Angeles Times, 18 Mar. 2023 After a stint as a camp team manager, he was promoted in 2012 to oversee conveyance and distribution for the district’s desert region, consisting of the pumping plants and camps that run from the outskirts of Joshua Tree National Park to the Arizona border. Melvin Backman, Harper's BAZAAR, 13 Feb. ![]() Recent Examples on the Web Bambara uses fashion as a conveyance for ideals and even warnings. ![]()
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