The Fraudulent Conveyance Act establishes the legal definition for fraudulent transfers of property that deprive creditors during bankruptcy proceedings. Individuals who try to protect their property by selling it at a low price to a family or friend or those who proceed with transactions knowing it will deprive creditors can face charges under this act. As experts in laws regarding white collar crimes in New York, you can rely on Raiser & Kenniff, PC, to help you defend against charges of fraudulent conveyance in court.
The Look-Back Period and Bankruptcy Filing
One of the most important principles of the Fraudulent Conveyance Act is the 90-day and 1-year look-back periods. Any conveyance of assets within 90 days of filing for bankruptcy are open to scrutiny by the trustee of the proceedings. Any transaction that took place during this time frame may be set aside and could be reversed if it is deemed inappropriate.
The trustee can also examine conveyances over the 12 months before the bankruptcy if the conveyance was made to a friend, relative or business partner. The 1-year window also applies if the trustee believes you may have done the transaction with the intention of depriving creditors of the sale of the asset, or if you did not receive adequate financial compensation for the value of the property conveyed.
Types of Fraudulent Conveyance: Actual and Constructive
If the creditor can prove that you conveyed the property or asset with the specific intent to defraud them of benefit from the sale of it, then the law considers the action to be “actual fraud.” If the court determines that you sold the property for less than a reasonable amount or if the transaction diminished your ability to pay your debts, then the term “constructive fraud” is used instead.
Regardless of the type of fraud, creditors can pursue the value of the property if you are convicted of fraudulent conveyance. While this has serious implications for you, including fines or jail time, it also means the individual who purchased the conveyed property may have to relinquish ownership. Buyers who were not aware of claims by creditors at the time of the purchase and contractors who have made uncompensated improvements to the property may be exempt from this rule.
Trust Our Experienced Legal Team to Fight Fraudulent Conveyance Charges
As one of the area’s top law firms, we pride ourselves on protecting the future of individuals charged with crimes in New York City. Convictions have a lasting impact on your quality of life that can last for years or even decades. That’s why we fight as hard as we can to help you make your best case in court.
Founded by former state prosecutors, Raiser & Kenniff, PC, knows how the system works on both sides of the court room. We know exactly how to build a defensible case for fraudulent conveyance and other white collar crimes. Contact us today to learn more about our expert legal services and find out exactly how we can help you with your unique case.