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Fraudulent Transfers

You either have a judgment or clear evidence that someone owes you money as a creditor. What’s to prevent the debtor from transferring around assets and hiding funds from your debt/judgment? Under the Missouri Uniform Fraudulent Transfer Act (“MUFTA”), transfers of assets may in certain circumstances be set aside to satisfy a judgment. 

“To set aside a transfer as fraudulent under MUFTA, it is necessary to show that the transfer was made with an intent to hinder, delay, or defraud creditors.” Birkenmeier v. Keller Biomedical, LLC, 312 S.W.3d 380, 389 (Mo. Ct. App.  2010). The creditor must prove the case, and fraud is never presumed when the transaction may be fairly reconciled with honesty. Buneman v. Zykan,  52 S.W.3d 49, 54 (Mo. App. E.D. 2001). The burden is on the plaintiff to prove intent to defraud and it must be shown by clear and convincing evidence. Because intent to defraud is often difficult to prove by direct evidence, Missouri courts may look to “badges of fraud” to infer intent to defraud. Badges of fraud including, without limitation, (1) a conveyance to a spouse or near relative; (2) inadequacy of consideration; (3) transactions different from the usual method of transacting business; (4) transfers in anticipation of suit or execution; (5) retention of possession by the debtor. 

Contact with questions relating to creditors, debtors, judgments and fraudulent transfers.