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Credit card payments as preferences: the Sixth Circuit joins the bandwagon.(credit column)

Business Credit

| June 01, 2009 | Nathan, Bruce | COPYRIGHT 2009 National Association of Credit Management. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan.  All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)Copyright

The law never stands still. That's what's so great about it! Eighteen months ago, the courts were debating whether a debtor's use of a credit card to pay off the debtor's indebtedness to another credit card issuer or other third party is a transfer of an interest of the debtor in property so as to give rise to preference risk. Just a few months ago, the United States Court of Appeals for the Tenth Circuit, in In re Marshall, brought some clarity to this issue by ruling that a balance transfer from the debtors' credit card account to pay off their indebtednesses to another credit card issuer is a transfer of the debtors' interest in property and, as such, is a recoverable ...

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Source: HighBeam Research, Credit card payments as preferences: the Sixth Circuit joins the...

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