New York readers might be interested in the story of a man who sold his technology company for $1.8 billion only to file for personal bankruptcy five years later. The man in this story says that he now owes up to $100 million and has approximately $50 million to pay those debts. Most of his losses are alleged to be the result of bad investments in real estate and other ventures.
If he chooses to file Chapter 7 bankruptcy, he will be able to start over with a clean slate. He will not be required to pay back his debts because they are almost all business-related. His petition for bankruptcy was filed in late May. It listed assets totaling as much as $50 million and debt totalling as much as $100 million. When a Chapter 7 bankruptcy is filed, an impartial trustee is appointed to administer the case. The trustee will then sell off the assets to help pay for the debts.
There are different types of bankruptcy options available for people with debt problems. Each type comes with different benefits or protections as well as drawbacks. Several factors influence which type of bankruptcy is most appropriate for a given situation. In this story, the man chose Chapter 7 because it would allow him to start over with a clean slate. If his bankruptcy filing goes through, he will not be required to pay back his business-related debts.
Anyone considering filing for bankruptcy may benefit from consulting with a bankruptcy attorney. An attorney may be able to review the person’s financial situation and advise them regarding the type of bankruptcy that would benefit them the most. In addition, an attorney might help them prepare and file for bankruptcy.
Source: Bloomberg Business Week, “How Halsey Minor Blew Tech Fortune on Way to Bankruptcy“, Dawn McCarty and Ari Levy, May 31, 2013by