[chingutee]

I'm asking this question for a friend.

He currently lives in Texas and has lived here for the past 16 years. He was recently sued for an old credit card debt, but no court date or judgment has been given yet. At this time he cannot afford bankruptcy although it will be something he'll seek out in the future. Until then, however, he only earns just enough to get by each month. I understand that there is no wage garnishment within the state of Texas and that wages are considered exempt property, but I also understand that his bank account can be frozen or garnished itself. He's thought of having his wages direct deposited into his ex-wife's account instead since she's in charge of his finances anyway, but someone else has warned him that this might be seen as fraudulent transfer. Is this true, even though he's only redirecting exempt wages anyway? He can't afford to have any of what he earns taken because he still has a family to support.

If this could be legitimately construed as some form of fraudulent conveyance, what can he legally do to protect his wages that doesn't involve bankruptcy since that isn't a viable option for him right now?

[Fr_Chuck]

If they can find and follow his pay check, into that bank account, they can freeze it anyway, and she will have to prove that the funds are hers.
And tracing money is fairly easy now adays.

He will need to cash the checks, and not put the money in the bank, pay with money orders and so on.

[chingutee]

If they can find and follow his pay check, into that bank account, they can freeze it anyway, and she will have to prove that the funds are hers.
And tracing money is fairly easy now adays.

He will need to cash the checks, and not put the money in the bank, pay with money orders and so on.

I'll have to verify it with him later, but I think he has to have his wages direct deposited. It's not an option.

Do you know if redirecting the wages into another person's account would be considered fraudulent transfer? I wouldn't think so since it doesn't involve actually moving funds from one account to another, just redirecting the direct deposit of exempt wages.

I've thought of the whole money order thing, but that's a bit of a hassle and I hoped to avoid it, especially since he may not even be able to receive his pay in check form.

[Fr_Chuck]

It should be an exact fraud, but I really believe if they want to find the money, they can. In fact I would think as part of the court proceduings, they may even ask him to verify where the money is going. Just remember the money is stlil at risk, just harder to find

[chingutee]

It should be be an exact fraud, but I really beleive if they want to find the money, they can. In fact I would think as part of the court proceduings, they may even ask him to verify where the money is going. Just remember the money is stlil at risk, just harder to find

So it's fraud if he has his wages placed into another person's bank account, but not fraud if he simply cashes his check, even though the wages are exempt either way.

The law is too strange for me, I just don't understand it. Anyway, thanks for the input. I'll let my friend know and hope it works out for the best.