'Naked' Liens Don't Open IRAs To Creditors: 6th Circ.

Law360, New York (June 17, 2013, 8:54 PM EDT) -- The Sixth Circuit on Monday reversed lower courts’ rulings that found a bankrupt man’s retirement account was fair game for creditors after he signed a lien agreement with Merrill Lynch, ruling that a “naked lien,” stripped of any connection to a credit transaction, doesn’t disqualify a retirement plan from exempt status.

In a published opinion, a three-judge panel for the appeals court reversed rulings from bankruptcy and district courts that found James Daley impermissibly used a $66,000 Merrill Lynch IRA to extend himself credit by granting...
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