Trying To Work Up Sympathy, Nothing's Comin'
There seems to be a discrepancy between whether Richard Fuld, the former CEO of Lehman Brothers, sold his Florida mansion to his wife for $10 or $100. Either way, the transaction of the home, bought for $13.75 million a few years ago, is clearly setting up some kind of accounting shenanigan.
It is possible that he is now transferring properties because of his fears of investor lawsuits or a possible bankruptcy, lawyers in Florida said.
“This is the oldest trick in the books” said Eric S. Ruff, a lawyer with Ruff & Cohen in Gainesville, Fla. “It’s common when you hear the feet of your creditors approaching to divest yourself.”
Usual rich person using the tools of legislation created for rich people to navigate. I get it. Only there's a loophole to the loophole.
Florida has particularly generous home protection laws that protect residents from losing their homes in the case of lawsuits or bankruptcy. But Mr. Fuld may not see much benefit by shifting the house to his wife’s name because the Fulds may not be able to prove residency there.
Mr. Ruff, the lawyer in Florida, said that it might be difficult for him to claim residence in Florida, because he primarily lived and worked in the New York area. That could mute any bankruptcy benefit.
And, Mr. Ruff said, the transfer to his wife could be deemed fraudulent conveyance if she did not pay enough for the house. That would make the house fair game for creditors who come after Mr. Fuld.
It's just a shame what those greedy creditors can do to a hard-working... OK, I tried. I suppose someone somewhere feels sorry for Mr. Fuld, perhaps Mrs. Fuld, but it's not me. My personal view is that the Fuld case would be a good test to see if we can get a return of the punishment of the stocks and pillories.