Queens Fraudulent Transfers
A fraudulent transfer occurs when a debtor transfers, sells, or gives away his (or her) property in order to avoid paying a legitimate debt owed to a creditor. Doing so is consider fraudulent and is illegal. While fraudulent transfers are typically associated with bankruptcy, avoiding fraudulent transfers can be accomplished by smart, advance estate planning. To learn more about how planning in advance can help protect your assets from future creditors, contact an experienced Queens fraudulent transfers lawyer at the Law Offices of Stephen Bilkis & Associates.What makes a transfer fraudulent
There are two scenarios in which transfers of property may be deemed fraudulent. The first one involves a debtor who in anticipation of a bankruptcy filing transfers property with the actual intent of defrauding a creditor. This means that the debtor makes the transfer in order to avoid paying a creditor, in order to delay paying a creditor, or in order to minimize the asset available to pay the creditor. For example, Adam owes significant debt to several companies, including owing Big Credit Card Co. $25,000. Adam used some of his savings to pay off his creditors, but does not want to use all of his assets to pay his debt. He decided that his best option for climbing out of debt is to pay file bankruptcy. However, before filing he gave his brother a gift of one of his expensive sports car. He also gave other expensive gifts of property to other family members. Soon thereafter Adam filed for bankruptcy. As a Queens fraudulent transfers attorney will explain, the trustee in charge of Adam’s bankruptcy case would likely find that the gifts that Adam made were fraudulent transfers and would seek to recover the property.
The second scenario occurs when a debtor transfers an asset without any intent to defraud his or her creditors. However, the transfer is such that the debtor does not receive in return the fair market value of the asset. Such a transfer may involve selling property for less than market value, or giving away property. For example, Elena was experiencing money problems. She had lost her job. When she finally found a new job, her salary was significantly lower. As a result her bills were piling up and she struggled to catch up. Her creditors were constantly calling her. She reluctantly decided to sell a few of her assets to pay her creditors. Because she was in such desperate need for cash, she accepted the first offers for the property she was selling even though she was aware that the property was worth more. She used the money to pay down some of the debt she owed as well as to pay some of her everyday expenses. However, Elena soon realized that her debt was too much and she needed to file for bankruptcy. Upon reviewing the transactions, an experienced fraudulent transfers attorney in Queens cautioned that Elena’s sale of property for less than fair market value may amount to fraudulent transfers even though Elena was not trying to avoid paying her creditors.Consequence of fraudulent transfers
If a transfer or series of transfers is determined to be fraudulent, then the trustee in the bankruptcy case may seek to reverse the transaction and recover the property.Avoiding fraudulent transfers
With advance planning and the help of a skilled fraudulent transfers attorney serving Queens, you can put asset protection strategies in place that would protect your assets from future creditors. However, in order for such strategies to work, you must plan in advance. For example, placing property in trust would result in the title of the property being in the name of the trust and not in your name. As a result, creditors would not be able to reach such property—as long as the trust is set up properly.Contact the Law Office of Stephen Bilkis & Associates
Preserving your assets for the future is an important part of comprehensive estate planning. While it is difficult to anticipate what the future holds, making sure your assets are protected will ensure that you are able to enjoy them and that you will be able to transfer them to your loved ones after you pass away. The attorneys at the Law Offices of Stephen Bilkis & Associates have years of experience helping clients design custom estate plans that include asset protection strategies and strategies to minimize taxes. Contact us at 1-800-NY-NY-LAW (1-800-696-9529) to schedule a free, no obligation consultation regarding your case. We represent clients in the following locations: Queens, the Bronx, Brooklyn, Long Island, Manhattan, Nassau County, Staten Island, Suffolk County and Westchester County.