CBS Fraudulent Transfers & Avoidance Actions 2

Question 1

What is the look-back period for avoiding preferential transfers to insiders under Section 547 of the Bankruptcy Code?

Accepted Answer

1 year

Answer

90 days

Answer

6 months

Answer

2 years

Question 2

Under the 'ordinary course of business' defense to a preference claim under Section 547(c)(2), a transfer may be protected if it was made:

Accepted Answer

In the ordinary course of business or financial affairs of both the debtor and transferee, or according to ordinary business terms

Answer

Within 30 days of when the debt was incurred

Answer

For more than reasonably equivalent value

Answer

To a creditor holding a perfected security interest

Question 3

A trustee seeks to avoid a lien under Section 547 as a preference. Which element is NOT required to establish a preferential transfer?

Accepted Answer

Fraudulent intent by the debtor

Answer

Transfer to or for the benefit of a creditor

Answer

Transfer on account of an antecedent debt

Answer

Transfer while the debtor was insolvent

Question 4

Under Section 549 of the Bankruptcy Code, the trustee may avoid post-petition transfers of estate property that are:

Accepted Answer

Not authorized under the Bankruptcy Code or by the court

Answer

Authorized by the bankruptcy court

Answer

Made in the ordinary course of business with court approval

Answer

Made to secured creditors with valid liens

Question 5

The 'contemporaneous exchange for new value' defense under Section 547(c)(1) protects a preference payment when:

Accepted Answer

The transfer was intended and actually resulted in a contemporaneous exchange for new value given to the debtor

Answer

The creditor extends new credit within 30 days of receiving the payment

Answer

The debtor was solvent at the time of transfer

Answer

The amount transferred was less than $6,825

Question 6

Under state fraudulent transfer law incorporated via Section 544(b), a trustee may avoid transfers that are avoidable by:

Accepted Answer

At least one actual unsecured creditor holding an allowable claim

Answer

Any creditor, even one without a specific claim against the estate

Answer

The U.S. government as a creditor

Answer

A majority of creditors by dollar amount

Question 7

A subsequent transferee (not the initial recipient) of a fraudulently transferred asset may avoid liability under Section 550 if they took the property:

Accepted Answer

In good faith and for value, without knowledge of the voidability of the transfer

Answer

For fair market value regardless of knowledge

Answer

As a gift with no consideration

Answer

From an insider of the debtor