In Florida, a fraudulent transfer (also known as a fraudulent conveyance) is a transfer of assets that is made with the intent to defraud, delay, or hinder creditors. Whether a transfer is fraudulent depends on various factors and evidence.

In Florida, fraudulent transfer claims are often dealt with under the Florida Uniform Fraudulent Transfer Act. Here are key points that are often considered evidence of a fraudulent transfer:

  1. Intent of the Debtor: The primary factor is the debtor’s intent at the time of the transfer. Evidence that the debtor intended to defraud creditors can be direct or circumstantial.
  2. Lack of Consideration: If the debtor transferred assets without receiving reasonably equivalent value in return, it might be considered fraudulent. This is especially scrutinized if the transfer is made to a close relative or business associate.
  3. Financial Condition Before and After the Transfer: If the transfer leaves the debtor insolvent (unable to pay debts as they come due), it can be evidence of fraudulent intent. The debtor’s financial situation before and after the transfer is closely examined.
  4. Existence or Threat of Litigation: If a transfer is made while litigation is pending or threatened against the debtor, it can be seen as an attempt to remove assets from the reach of potential judgments.
  5. Secrecy or Concealment of the Transfer: Attempts to hide the transfer, not recording it, or otherwise being secretive about it can be evidence of fraud.
  6. Transfer of the Debtor’s Entire Net Worth: If a debtor transfers substantially all of their assets, it can indicate fraudulent intent.
  7. Relationship Between the Debtor and Transferee: Transfers to insiders (like family members, related companies, or close friends) are more likely to be scrutinized and considered fraudulent, especially if other suspicious factors exist.
  8. Retention of Possession or Control over Property: If the debtor continues to use or control the property after the transfer, it might indicate a fraudulent transfer.
  9. Timing of the Transfer: A transfer made shortly before or after a substantial debt is incurred is suspect.
  10. The Debtor’s Concealment of Assets: If the debtor hides assets or misleads creditors about their financial status, it can support a fraudulent transfer claim.

It’s important to note that one or more of these factors doesn’t automatically mean a transfer is fraudulent; they are indicators that courts consider. The overall circumstances of each case are taken into account.

Gideon Alper

About the Author

Gideon Alper is an attorney who specializes in asset protection planning. He graduated with honors from Emory University Law School and has over 15 years of legal experience.

Gideon has helped thousands of clients protect their assets from creditors. Before private practice, he represented the federal government while working for the IRS Office of Chief Counsel.

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