In United States v. Harrington (D. Colo. No. 1:19-CV-02965 Dkt. #111 Order 2/28/24), here, the Government brought an FBAR willful penalty collection suit against George Harrington, later expanded to include his wife, Monica on fraudulent transfer liability. The Government sought judgment for the FBAR penalties plus interest and costs (Count One), fraudulent transfer liability against Monica (Count Two), and an order for repatriating sufficient funds necessary to pay the respective liabilities (Count Three). (The CL docket entries are here.)
Count One (FBAR liability) is fairly straightforward with the Court imposing the civil standard for willfulness approved by other circuits because the 10th Circuit had not spoken on the issue. See pp. 15-24.)
Count Two (fraudulent transfer liability) is also fairly straightforward, with the Court imposing fraudulent transfer liability upon Monica for having received assets from George under the Federal Debt Collections Procedures Act, 28 U.S.C. §3304(b)(1). See pp. 24-30. The FDCP imposes liability for transfers having 11 nonexclusive characteristics called badges of fraud. The Court discusses the presence or absence of those characteristics and concludes (p. 30):
The Court finds six (out of 11) badges of fraud are present. See Key, 837 F. App’x at 354 (five badges of fraud sufficient to uphold summary judgment for government); Osborne, 807 F. App’x at 524 (six badges of fraud sufficient to affirm summary judgment). As a result, the Court finds a reasonable jury could only determine that George’s transfer of his interest in the ValorLife policies to Monica was a fraudulent transfer under 28 U.S.C. §3304. See Anderson, 477 U.S. at 248. The Motion is granted, therefore, as to Count 2.
JAT Comment: I infer that the 11 characteristics permit some weighting rather than just majority controls the decision (I infer this because 5 was sufficient in the cited Osborne precedent.; I have not otherwise researched the issue of weighting).
