Dick Fuld is in the news again — this time for selling a $14 million Florida house to his wife for $100. No one is quite sure why he felt he needed to do this, but some are speculating that he may be trying to hide assets from Lehman Brothers shareholders in case they are getting ready to sue to him.
From the Times of London:
Mr Fuld has been named in at least one lawsuit filed by San Mateo County seeking damages for the collapse of Lehman Brothers. The Californian local authority lost $150 million on its investment in the Wall Street bank.
Lawyers were divided yesterday over whether the decision to move the mansion into Mrs Fuld’s name was an attempt to put assets beyond the reach of investors who intend to sue the former chief executive for compensation. Some lawyers cited Florida’s unusually generous home protection laws, which could save the Fulds from losing their house in the event of a lawsuit or bankruptcy.
To take advantage of these rules the couple would have to prove that they resided in Florida, which could be difficult because of the amount of time they spent in New York. Also, if a court decided that Mrs Fuld did not pay enough for the mansion, the transfer would be deemed to be “fraudulent conveyance” that would render the move void, lawyers said.
There’s more info about the legal implications of this sale at Tax Prof Blog.
Lehman Brothers’ Richard Fuld ‘sold’ mansion to wife for $100 [ToL] (Thanks, Tom!)