What is bankruptcy and what does the U.S. Constitution say about it? The following is a small section taken from a U.S. Government site “Article I, Section 8, of the United States Constitution authorizes Congress to enact “uniform Laws on the subject of Bankruptcies.”
Under this grant of authority, Congress enacted the “Bankruptcy Code” in 1978. The Bankruptcy Code, which is codified as title 11 of the United States Code, has been amended several times since its enactment. It is the uniform federal law that governs all bankruptcy cases.
The procedural aspects of the bankruptcy process are governed by the Federal Rules of Bankruptcy Procedure (often called the “Bankruptcy Rules”) and local rules of each bankruptcy court. The Bankruptcy Rules contain a set of official forms for use in bankruptcy cases.
The Bankruptcy Code and Bankruptcy Rules (and local rules) set forth the formal legal procedures for dealing with the debt problems of individuals and businesses.”
Famous people are not exempt from poor financial management and over extending their spending. DMX’s real name is Earl Simmons. He is an actor and a rapper; acting in movies such as “Romeo Must Die”, “Exit Wounds” and more including a reality show. He was voted Favorite Rap/Hip Hop Artist 2000 on the American Music Awards.
DMX is also an author having written his autobiography in 2003. He is a father to 12 children and has a rap sheet that includes cruelty to animals, reckless driving and more. Even with over 30 million records sold worldwide and being known as the ‘best selling rap artist’. DMX is reportedly worth less than $0 – he is reported to have a net worth of negative $10 million due to bankruptcy in 2013.
Donald Trump’s bankruptcies were quite publicized – especially in light of his Presidential run in 2012. Donald’s financial troubles were with four of his many corporations. His personal wealth was not touched or in trouble.
Michael Jackson needed to file bankruptcy in 2007 – two years before his death. Even with his one billion dollar recording contract in 1991 and his 750 million records, he still was not able to pay back a $25 million loan on his Neverland home. This compound even needed its own fire department.
Athletes are also not exempt from bankruptcies. Sports Illustrated reported that 78% of all NFL players are usually bankrupt within 2 years of retirement. Mike Tyson, a world class boxer had more than $400 million dollars but also had the ‘over the top’ luxurious lifestyle and a very expensive divorce. He filed bankruptcy in 2003 with debts of $27 million.
Bankruptcy changed the life of one entertainer for the better. MC Hammer rose to fame in 1990 for his hit “U Can’t Touch This” but by 1996 he was $13 million in debt with a $12 million mansion needing 200 paid staff. He had some legal difficulties with copyright infringement issues. However, he saw the futility of his ways and became a pastor.
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