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In ordinary words.
The law may let someone keep assets while a judgment goes unpaid.
In legal terms.
Federal and state exemptions protect specified property, often subject to limits and exceptions.
Where it stops being legal.
This practice is not categorically legal. Applicable federal, state and local laws, disclosures, procedural protections and the specific facts can make particular conduct unlawful.
General U.S.-focused information. Cases and statutes may have jurisdiction-specific exceptions. This citation may be a general primer; verify the governing primary authority. Not legal advice.