People can be tricky when their assets are at risk. An experienced New Jersey banking law attorney knows how to seek out those fraudulent transfers and conveyances.
What Is a Fraudulent Transfer or Conveyance?
Fraudulent transfer or conveyance is the transferring of money or property to another person or company in an attempt to avoid debt or asset seizures.
What Transfers or Conveyances Are Considered Fraudulent?
The transfer or conveyance of assets is fraudulent if it is performed with actual intent to hinder, delay, or defraud any creditor. Thus, actual intent is present if the assets are moved with the specific intent to avoid satisfying an obligation or specific liability. This may include moving assets into an asset protection vehicle or scheme when the assets are at risk. If, however, the debtor prefers paying one creditor over another, no fraud occurred.
Proving Fraudulent Transfers or Conveyances
A New Jersey banking law attorney will show a debtor committed a fraudulent transfer or conveyance by proving the:
- Debtor transferred his or her property;
- Debtor received less than fair market value or consideration for the property; and,
- Transfer left the debtor without the means to satisfy the debt.
Evidence of Fraudulent Transfers or Conveyances
Although proving actual intent is rarely possible, you can provide circumstantial evidence of fraud by looking at the facts and circumstances surrounding the transaction or conveyance:
- Insolvency after the transfer
- Lack or inadequate consideration
- Family or “insider” relationship among the parties
- Existence of the threat of litigation or during litigation
- Debtor’s financial situation at the time of transfer or thereafter
- Secrecy of the transaction in question
- Deviation from the usual method or course of business
- Debtor’s retention of possession, benefits or use of the property
- General chronology of events
- Existence or cumulative effect of a series of transactions after the onset of the debtor’s financial problems
Seek a New Jersey Banking Law Attorney
If you are trying to collect a debt and believe the debtor fraudulently conveyed or transferred assets, contact a knowledgeable New Jersey banking law attorney with Snellings Law LLC at (973) 265-6100.