Actual Fraudulent Conveyance

Actual fraudulent conveyance refers to a transaction where a person deliberately transfers assets to avoid creditors, thereby hiding or reducing what they owe. This often involves selling or giving away property at less than its value, or transferring it to friends or relatives. The intent behind the transfer is key; if it’s done with the purpose of defrauding creditors, it can be legally challenged. Courts may reverse the transaction, allowing creditors to reclaim the owed amounts. This concept seeks to prevent dishonest behavior that undermines financial responsibilities and protects creditors’ rights.