BUS 410 Study Guide - Midterm Guide: Fraudulent Conveyance, Automatic Stay, Strongarm

• School: Emory University
• Department: Business
• Course: BUS 410
• Professor: Burdette Allison

Document Summary

Part of the point of bankruptcy is to protect the debtor (bankrupt person) (2) like-creditors should be treated fairly and equally: no fraudulent conveyances hiding available money, no preferential transfers treating some creditors better than others. If you violate this, the court has strong-arm power to claw back the money from the creditor paid unfairly to equally divide things among creditors. Ex: madoff bankruptcy court continuously ruled in favor of the trustees/creditors. Secured and unsecured creditors are treated differently in bankruptcy. Secured creditors (collateral: whenever you finance your purchase of something (ex: home, car, secured transactions of goods are covered by ucc article 9, less risk, charge lower interest rates, protected more during bankruptcy (get assets first) Unsecured creditors: more risk, charge higher interest rates, protected less during bankruptcy (kind of just screwed over, ex: missing payments credit card bills, hospital bills, etc.