There are many different types of financial offenses that the state prosecutes. Some people face fraud allegations because of their business behavior or professional conduct. Others may face fraud allegations because of how they try to protect their personal resources.
The state criminalizes fraudulent conveyance and allows prosecutors to bring charges against those who engage in inappropriate attempts to avoid financial responsibility by gifting or selling their assets.
What constitutes fraudulent conveyance?
Fraudulent conveyance is essentially an attempt to transfer assets to avoid their liquidation to repay creditors or lawsuit plaintiffs. Fraudulent conveyance could look like an individual gifting a high-value financial account to a family member as soon as they learn about a pending lawsuit.
It could also involve selling an asset for well below its fair market value to someone who agrees to later reverse the transaction and return the assets. Fraudulent conveyance can even involve the creation of a trust and the transfer of personal property to the trust. Both the party attempting to avoid their financial obligations and any other party involved in the transfer could face criminal prosecution.
What are the penalties for fraudulent conveyance?
In most cases, fraudulent conveyance results in misdemeanor charges in accordance with state statutes. Those who plead guilty or get convicted after a trial may face incarceration and fines.
The potential criminal penalties for a fraudulent conveyance conviction can include up to a year in county jail and $1,000 in fines. The defendant may also have to cover court costs. Those who transferred or conveyed assets may also face orders of restitution related to their attempt to avoid financial responsibility to another party.
For the state to prove fraudulent conveyance, the case has to meet certain specific standards. Factors including knowledge of a debt or upcoming legal action can influence whether the situation actually meets the definition of fraudulent conveyance. Some people accused of making inappropriate transfers did not intend to defraud others and may have an opportunity to clear their names.
Reviewing alleged fraudulent activity with a skilled legal team can help those facing white-collar criminal charges plan a viable defense strategy. Those with proper insight and support may be able to defend against allegations of fraudulent conveyance to protect their finances and their reputations.
