Prior to the filing of his bankruptcy, the debtor conveyed his residence to his parents. This conveyance apparently constituted a fraudulent conveyance. The debtor claimed the property as exempt in order to protect some of the equity. Bankruptcy Code Sec. 522(g) bars a debtor from exempting property which was fraudulently conveyed. This case is important in illustrating the dire risks of any type of asset protection strategy.
Seeking a Homestead Exemption? Do Not Fraudulently Convey Your Home.