CELEBRITIES BIGGEST MISTAKES

Well for my first post I decided to start off with a little entertainment. I will talk about any subject and of course there are very many more important issues going on in the world but I just could not help it.

I can’t understand how most celebrities and entertainer manage to get themselves in bad situations such as, bankruptcy or just going completely broke. I myself have very different views about cash and credit and how they should be used. Some of the things I read on the issues, I feel should require some type of reprimands by them. I feel it’s credit abuse.

According to TEXAS PENAL CODE

TITLE 7. OFFENSES AGAINST PROPERTY

CHAPTER 32. FRAUD

SUBCHAPTER C. CREDIT

Sec. 32.31. CREDIT CARD OR DEBIT CARD ABUSE. (a) For purposes of this section: Added by Acts 1999, 76th Leg., ch. 1413, Sec. 1, eff. Sept. 1, 1999.

SUBCHAPTER C. CREDIT

Sec. 32.31. CREDIT CARD OR DEBIT CARD ABUSE. (a) For purposes of this section:

(b) A person commits an offense if:

(1) with intent to obtain a benefit fraudulently, he presents or uses a credit card or debit card with knowledge that:
(A) the card, whether or not expired, has not been issued to him and is not used with the effective consent of the cardholder; or

(10) being authorized by an issuer to furnish goods or services on presentation of a credit card or debit card, he, with intent to defraud the issuer or the cardholder, furnishes goods or services on presentation of a credit card or debit card obtained or retained in violation of this section or a credit card or debit card that is forged, expired, or revoked; or
(11) being authorized by an issuer to furnish goods or services on presentation of a credit card or debit card, he, with intent to defraud the issuer or a cardholder, fails to furnish goods or services that he represents in writing to the issuer that he has furnished.

Basically in Texas, Credit card abuse is knowingly presenting false credit cards to get property, whether it be yours or some else’s, basically stealing a credit card or debit card and trying to use it knowing that it’s not yours. Or trying to use yours knowing that you don’t have the money to pay it or knowing that there is something to prevent you from being able to use pay but you still try to get some type of property from a financial institution or someone who issues credit. The penal code defines this very specifically but of course it can be interpreted in different ways.

Now I think that there should be an amendment to this law to avoid bigger problems in the future.

My issue is with these big name celebrities and public figures that makes millions of dollars from us, regular consumers, and then file for bankruptcy of all the debt they racked up. I think it’s abuse of credit and status. Some can be held criminally liable but that only goes into misappropriating of funds.

These celebrities use bankruptcy as a tool to get out paying for things they knowingly purchased, whether they let someone else do it or not, it was done for them.

These celebrities include, just to name a few:

According to How to Save Money’s website

They named the top 20 celebrity bankruptcies but I will only mention the few I was outraged by.

Willie Nelson
Marvin Gaye
MC Hammer
Toni Braxton
Mike Tyson
Walt Disney
Donald Trump
Natalie Cole
Marion Jones
Anna Nicole Smith
Donald Trump

Quoted directly from their website they give a few details about each of them.

Willie Nelson

Willie Nelson is one of Country Music’s living legends with over 50 million records sold but even with all those gold records he was no stranger to debt. Well known as a big spender with a generous heart, and an entourage somewhat like MC Hammer’s Willie Nelson’s finances caught up to him in the late 90′s. In 1997, the government seized Nelson’s gold records, Texas ranch and bank accounts to pay off about $16.7 million in back taxes.

In true American fashion however Willie Nelson did a Taco Bell spokesperson side job and released a new album in honor of the IRS, titled “The IRS Tapes: Who Will Buy My Memories?” to raise funds and settle his debts.

This was quite clever of Willie Nelson to use the IRS to make even more money to pay back his debt to them. I believe we all should pay our fair share of taxes based on the money we make. I think the government should be the first to receive their money, so that we don’t get into big issues with the government. Well I should say get into big bills because that’s the only trouble you could get into with the IRS.

MC Hammer

Who can forget the baggy pants and dance moves which would make most people keel over in 30 seconds. The 90′s were full of glitz and gold and few can forget the famous Hammertime song by M.C. Hammer.

However along with outrageous parachute pants and dance moves M.C. Hammer’s rise to fame came with a crushing blow to his personal finances. Racking up some of the biggest musical hits when he also had an entourage (and payroll) to match.

M.C. Hammer reportedly paid over $500,000 a month to a staff of 300 people and in 1996, had accumulated $13.7 million of debt with only $9.6 million in assets. He filed for bankruptcy with debts that included $500,000 in attorney fees, $110,000 to his decorator and $100,000 to the IRS.

Of course we all know about the horrible case with M.C. Hammer with short-lived wealth. He was being very generous to friends and family who of course didn’t return the favor when he was in a horrible situation. He should have had a life coach as soon as he signed his record deal because he had plenty of ” takers and users” all around him. Even today he is very public about his financial problems he’s faced in the past. Something you don’t see to often. Sad case however today its said that he is a pastor and life coach himself. Hopefully, it’s not a scam and he is really trying to change lives and help others to avoid those same mistakes he made.

Hmmm…
I guess we will find out soon…

Toni Braxton

Toni Braxton, a grammy-winning R&B singer known for her sexy, sultry voice and hit songs such as “You’re Makin’ Me High” and “Un-Break My Heart” attempted to get out of her recording contract with LaFace Records in 1998 as she felt it was no longer fair. She filed a lawsuit however LaFace turned around and counter-sued her, forcing Braxton to file bankruptcy and spend most of 1998 dealing with legal issues.

Braxton was diagnosed with Lupus in 2009, and has dealt with ongoing health issues since then. Braxton filed bankruptcy for the second time in 2010, claiming to owe up to $50 million, with a net worth of only $1 million to $10 million.

This case to me was very interesting. I understand that record labels exploit many artist and they are out to make more money than the artist but she probably should have had an attorney look at most of her contracts before signing them. The biggest issue is the second filing which to me was ridiculous. Her claims was that she had over $50 million in debt but was only worth about $10 million. According to court document filed by her attorney reported her owning:

– AT&T
– The Four Seasons Hotels
– Cedars-Sinai Medical Center
– Various medical bills
– DirecTV
– Neiman Marcus
– The William Morris Agency
– Tiffany & Co.
– Orkin Pest Control
– The Internal Revenue Service
– BMW Financial Services
– ADT Security
– American Express
– Flamingo Las Vegas
– Mesa Air Conditioning
– Nevada Power Company
– Screen Actors Guild
– The Westin
– Wells Fargo Bank

I think she should have known better for some of these creditors. Example being Neiman Marcus and Tiffany & Co. I am outraged about her over spending with these creditors and racking up these huge bills. Some things are necessary for living but some things are just luxury. I don’t think there is a hard decision for deciding whether to shop at Neiman Marcus and Tiffany &Co., or pay your medical bills. Toni Braxton has had several medical issues with herself and her son so I can understand that those bills can pile up. Ms. Braxton has been very open about her illness and has been linked to many foundations to help others with the same or similar conditions. Especially the foundation to treat and detect early age autism. It’s also said that her son was diagnosed 5 years ago and has made great improvements since diagnosed. That’s wonderful to hear and I hope that the foundations help as many children as possible with the condition. I’ve worked with autistic children and I know when detected sooner it makes a huge difference in a child. However she had to know that a $3,000 bag wasn’t needed as opposed to going to the doctor or paying that huge medical bill.
Much of this was the negative results of being hospitalized and canceling her Las Vegas gig. I feel that this was reckless of her and I also feel that the Texas penal code for credit card abuse applies to some of these situations if you read it carefully.
Some may see her on the reality show “The Braxtons” on WETV which depicts the day-to-day life of her family and herself. I watch the show and I enjoy watching them. On one of the episodes of the first season, Toni was searching for houses in LA and the home prices was well over $2 million. This was after the second bankruptcy she filed. I think this was reckless an irresponsible of her after claiming to be $50 million dollars in debt. Some things you can’t help or change such as health issues however you can change or choose to buy a $2 million dollar house or settle for a nice cozy $100,000 house and not have to file bankruptcy. That’s my opinion and most of these celebrities listed here made the wrong choice.

Lets hope Toni doesn’t file bankruptcy again on this new house. She may need to call her brother-in-law and former manager Vincent Hubert whose net worth is said to be around $150 million. There has not been any reports of her salary from the reality show but hopefully it can get this debt paid off. We just have to wait and see, I’m sure it play out on the show.

Natalie Cole

After many successful years as a recording artist, Natalie Cole (the daughter of recording legend Nat King Cole) had a career pause and problems with drug addiction in the early 80’s. By 1985 she was doing better, but still filed for bankruptcy protection in 1997.

Her career picked up again in the late 90’s, and she won the “Hitmaker Award” for the Songwriter’s Hall of Fame in 1999 . Natalie was diagnosed with Hepatitis C in 2008 and had a life saving kidney transplant but continues to record and inspire people around the world today.

I love Natalie Cole and her father was a great singer as well but having a father in the business should have taught her something and drugs should have been first on the list. There wasn’t many details about her bankruptcy but I think the words “Drug Addiction” says enough for me. Some sources say that she is completely broke from this filing. I’m hoping that’s not the case. However Ms. Cole has been very open about her illness and has been linked to many foundations to help others with the same or similar conditions. Hopefully she can save a few lives in the future.

Mike Tyson

Retired former heavyweight boxing champion Mike Tyson won the WBC title as a 20-year-old and quickly became one of the most famous athletes in the world.

He went on to have a very successful boxing career, becoming known for his ferocious style in the ring and controversial behavior outside of the ring. Although Tyson received over $30 million for several fights and a career income estimated at $300 million, he filed bankruptcy in 2003.

He had a very difficult and public divorce from ex-wife Robin Givens blaming his financial situation on excessive spending on mansions and expensive cars. Tyson also blamed bad financial advisors and embezzlement as other causes for his bankruptcy.

Mike Tyson’s Estimated Net Worth today is under $5 million.

I think his story is sad and many people do this all the time. Mike Tyson was not surrounded by smart people who should have given him better advice. Including his ex-wife. I think Mike doesn’t have the money anymore to even attempt to pay back his creditors. He was known to be a loose cannon, I guess his career and money was the loose cannon.

Marion Jones

Marion Jones, an Olympic sprinter with 5 medals and endorsement deals worth millions of dollars has fought off financial troubles for some time now. After many anti-doping and other agencies made allegations against her about steroid use, Jones missed many meets and spent substantial amounts of money on attorneys to fight the allegations.

Jones also admits her own spending habits to support a certain “lifestyle” have forced her deep into debt. Jones has had to sell off some real estate assets, including a $2.5 million mansion she lost to foreclosure, to settle some of her debts and try to avoid bankruptcy.

Now Marion Jones was a big shock to me I guess because she wasn’t so open about it since the steroid scandal she had to endure. I know this had to be expensive to fight the case. Marion Jones was honest and admitted to having very bad spending habits trying to keep up a certain “lifestyle” after spending millions in legal fees. This would be the perfect case for credit card abuse. She knowingly presented credit cards and received loans for things she knew she could not pay for. The case may not have been foreseen but she was over spending.

Some may say this area is gray but those court filings and legal fees are just black and white papers if you ask me. It’s hard to say if she will ever get that “lifestyle” back, that she tried so hard to support.

Anna Nicole Smith

The Former model and 1993 Playboy Playmate of the Year Anna Nicole Smith was charged in a sexual harassment lawsuit brought by an employee in 1996. She lost the suit and filed bankruptcy due to an $850,000 judgment stemming from the lawsuit, along with other debts. The star apparently misplaced millions of dollars in jewels, and among debts listed in the bankruptcy filing was a $265.63 gas bill. After Smith’s 89-year-old billionaire husband J. Howard Marshall died, a battle began between her and her husband’s family over his estate. The bankruptcy court got involved since any possible money from the Marshall estate would be considered as potential assets. A Los Angeles bankruptcy court awarded Smith almost $500 million from the Marshall estate in 2000. In 2001 a Texas court ruled that Smith was not entitled to anything, and ordered her to pay $1 million in legal costs.

Think this case with Anna Nicole ended in tragic deaths and these debts may have contributed to her heart attack. Her bankruptcy was resulting to a big lawsuit but if she was around the attorney that claimed to have had a romantic relationship with, I’m sure she would have filed at some point in the future.
The court case with her deceased billionaire husband was never resolved. Her son later died and her death followed, then the son of her ex-husband died a year later. Reports have said that the money from the estate will be awarded to Anna Nicole’s daughter. Her death took everyone by surprise since she was sobering from prescription drugs and the old wild lifestyle she once lived.

Donald Trump

The Donald has a famous hairstyle and even more famous reputation as a real estate magnate who enjoys the extravagant life. Along the way, Mr. Trump has had a few bankruptcies, involving his casinos – four, to be exact in 1991, 1992, 2004 and 2009. Fortunately, he has his TV show and the rest of his real estate empire to help him stay afloat financially.

Recent questions have been posed to him about his string of bankruptcies. Trump stated that chapter 11 corporate bankruptcy, or reorganization – was just a tool he used to negotiate his corporations’ debt deals. Trump pointed out in an interview that Henry Kravis and Carl Icahn, two great businessmen, have both filed corporate bankruptcy. Incidentally, each of Trump’s chapter 11 bankrupt corporations did in fact renegotiate their debt, and each corporation has gone on to become very successful.

Donald trump on the other hand reasons were ridiculous and seemed like a huge scam. In my opinion after reading the Texas penal code on credit card abuse this case was open and shut for him and I think he is one that should be banned from filling ever again. If the business plan doesn’t work in the beginning then he should have taken those loses, paid the debts off and started over fresh.

With all that being said I think they all should have been held responsible for their bad judgements and filing for bankruptcy is not showing accountability. Having worked for a bankruptcy attorney in high school I know the way bankruptcy works. Heres a little information about how the process is done.
After filing with the courts, a trustee is assigned to said persons and they decide based on income and assets what can be paid and what debts can be negotiated for a lesser amount. So these celebrities have the right to rack up debts, credit cards and other bills and get out of paying only half the cost of them. Some assets can be liquidated to cover debts but I don’t think you can liquidate a pair of shoes or a nice tailored suit.

Credit is probably the worst thing and the best thing someone could have thought of for America. Unless they are the person giving the credit. I can understand credit for purchasing houses and for school but expensive cars and clothes shouldn’t be apart of the credit ordeal or option for bankruptcy. The government uses credit for everything and so do people. It’s a disease.

I think if you can’t pay for it now, wait and save. Pay with the cash and don’t count your chickens before they hatch as my mom always said.