Introduction
A fraudulent conveyance, commonly referred to as a fraudulent transfer, is an attempt by a debtor to avoid legitimate financial obligation by transferring cash or assets to another individual or company. Fraudulent conveyances are normally civil, not criminal matters, meaning that a debtor doesn’t have to go to jail if found guilty of a fraudulent conveyance. In extremely limited jurisdictions, some state laws allow prosecution and criminal punishment.
For the most part, fraudulent conveyances typically occur in the context of debtor/creditor relations, especially insolvent debtors who file bankruptcy. Hence, fraudulent conveyance lawsuits are commonly commenced almost exclusively by financial institutions or by personal bankruptcy trustees.