I read in the paper that someone I once knew was arrested for this: defrauding secured creditors.?

Question

What does that mean? I am not familiar with those terms.

Answer 1

A secured creditor is one that you owe money for a tangible item (like a car or a house) that they could take back if you renege on the loan (i.e. they can repossess the car or sell the house through a foreclosure).

School loans, credit cards, etc are considered unsecured loans because the creditor can't repossess anything if you don't pay them back.

Sounds like they probably lied about something (income/identity/etc) in order to get a secured loan.

Answer 2

Certain types of credit (debt) are secured. When a debt is secured, that means that there is some form of property (a car or a house or livestock) that serves as collateral and can be seized by the creditor if the debt is not paid. A person defrauds secured creditors when they sell the collateral secretly to defeat the security interest.

Answer 3

A person commits the crime of defrauding secured creditors if he destroys, removes, conceals, encumbers, transfers or otherwise deals with property subject to a security interest with purpose to defraud the holder of the security interest.
"Security interest" means an interest in personal property or fixtures as defined in the Uniform Commercial Code.

A person who destroys, conceals, encumbers, transfers, removes from the state, or otherwise deals with property subject to a security interest with the purpose of depriving the owner of the property or of the proceeds and value therefrom.

Answer 4

Probably that he illegally transferred title to someone else to avoid repossession of his car or foreclosure of his real estate.