The headlines this morning declare that rapper 50 Cent (Curtis Jackson III) filed for protection under Chapter 11 of the U.S. Bankruptcy Code. The personal Chapter 11 filing follows a May corporate Chapter 7 filing for his SMS boxing promotion company. Chapter 11 filings are usually employed by companies and corporate entities seeking to continue business operations and/or extremely high-earning or high net worth individuals.
50 Cent’s bankruptcy filing is not a new thing for the so-called rich and famous. In fact, my colleague Roland Jones wrote a book entitled Bankruptcies and Money Disasters of the Rich and Famous (formerly titled “They Went Broke?!”) which details the bankruptcies of people like Abraham Lincoln, Harry Truman, John Wayne, Toni Braxton and Donald Trump. Athletes like Mark Brunell, Lawrence Taylor, Mike Tyson and Curt Schilling have filed for bankruptcy protection. Business Insider posted this article listing some bankruptcies of the “rich and famous”.
People often ask, “How does that happen?” or simply dismiss such bankruptcy filings as the results of poor planning, poor stewardship or just plain stupidity. However, bankruptcy is about insolvency not about how much money you make or don’t make or how much stuff you have or don’t have. Insolvency is the inability to meet debt-servicing requirements (“I don’t make enough and I don’t have enough stuff to sell or borrow against to pay all of my bills”). Bankruptcy is a safety valve on the American economy designed by Congress to allow individual consumers and/or companies and corporate entities to liquidate, to start over or to reorganize in order to become once again a viable part of the American economy.
If you are insolvent or considering bankruptcy, realize that you are not alone as shown by the examples above and by the countless examples of Virginians and Americans who have needed a fresh start through the years. Contact Greenwood Law Firm today for a no-charge telephone consultation to determine whether a Chapter 7 bankruptcy or a Chapter 13 bankruptcy is a good option for you.