Rudy Giuliani files for BANKRUPTCY and lists more than $500million in debts
(www.dailymail.co.uk)
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Haha love it. Bankruptcy is not what many people think. It's filing for the right to not pay back your debts so you can keep your money. Filing for bankruptcy doesn't mean you're throwing up your hands and giving up all your assets and you're just letting the government know. It's a way to avoid financial ruin in exchange for a credit hit, and that's it. Good for him.
I know a guy who uses this strategy. Racks up a ton of debt and makes a ton of money in the process until his debts just barely outweigh his assets and then files like every 5 years. With all that money it's easy to re-build his credit in the meantime. Rinse. Repeat.
I'm not sure where you're getting your information, but it's not correct. You don't just get to keep all your assets and stiff your creditors. If it worked like that, everyone would constantly be filing for bankruptcy.
If you file Chapter 7, you first have to provide a detailed accounting of all your assets, right down to your clothing. The court will sell off your possessions to pay back your creditors. You'll usually get to keep your car and clothing (unless it's very high end and can be sold to consignment stores and such) your personal items that have little monetary value, and some home furnishings and such. The court will then take the proceeds from assets being sold to pay off your creditors. Usually, all of your creditors will be paid back portions of what you owe them, but not the full amount.
If you file Chapter 13 you get to keep your assets, but you still have to pay back your creditors. You just get more time to do so without incurring more penalties or fines for not paying on time. I think, but not entirely sure, that you get to pay a reduced amount of your debt.
Your friend is obviously not declaring all of his cash money and is hiding it from the bankruptcy court. Which is fraud and can get him 20 years in jail, a $250,000 fine, and he will not be able to discharge his debts or file bankruptcy again in the future.
You might want to find a better class of friends. What he does is not the actions of a man of integrity.
https://www.nolo.com/legal-encyclopedia/bankruptcy/hiding-assets-property-bankruptcy.html#:~:text=If%20the%20bankruptcy%20trustee%20discovers,it%20will%20deny%20your%20discha
I know a guy doesn't mean he's a friend. But bankruptcy is absolutely a solid tool that lets you keep your assets. If Rudy is smart, and being that he's a lawyer I assume he is, like this guy, he'll push most of his assets into LLC's and bypass any concern you just raised. He still controls the LLC's and thus, his assets, they're just not in his name. So when HE files for bankruptcy, only the assets in HIS name, not his LLC's will be under consideration for sell-off which, if he's smart, and he is, will be minimal.
Thanks for the link though.
Putting your assets into an LLC doesn't guarantee your creditors can't get to them in a personal bankruptcy.
https://www.nolo.com/legal-encyclopedia/limited-liability-protection-llcs-a-50-state-guide.html#:~:text=An%20LLC's%20money%20or%20property,ownership%20interest%20in%20an%20LLC.
And bankruptcy judges can also direct the priority of where payments go when doling out the money.
Just look at what happened to Alex Jones when he tried to file for bankruptcy to avoid paying out that Sandy Hook judgement.
It's not hard, bruh. Your LLC's can also own LLC's. It doesn't take a genius to figure it out. You can easily put things in trusts and create degrees of separation between you and your assets to make sure you never lose them, no matter what any judge tried to pull. Whatever links you may want to post.
Rudy is and will be fine. He chose to do this, remember. And it's not cause he's stupid.