What is the meaning of “fraudulent transfer”?

In California, "fraudulent transfer" is a legal term used to describe a situation in which a person or business deliberately avoids paying a debt by transferring their assets to someone else. It generally applies when a creditor has a claim to the assets of the debtor and the debtor conveys them to another person in order to prevent the creditor from collecting the debt. A fraudulent transfer is also sometimes referred to as a fraudulent conveyance. Under California law, creditors, such as banks and credit unions, can sue the person or business who is attempting to avoid the debt and go after the transferred assets in order to satisfy the debt. This is known as "avoidance of fraudulent transfer". There are several different types of fraudulent transfers that creditors may seek to avoid, including those that occur after a creditor has obtained a judgment against the debtor or when the transferred assets may have been subject to a security interest. In addition, if a creditor suspects that a person or business is making a fraudulent transfer, they must have evidence of intentional attempts to avoid paying the debt. This must include evidence that the debtor knew the transfer would hinder, delay, or defraud their creditors. Finally, the creditor must act quickly to bring the fraudulent transfer claim to the court. If a fraudulent transfer is proven, the creditor may be able to recover the asset and use it to pay the debt.

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What is the meaning of “fraudulent transfer”?

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