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10 Famous Cases of Celebrity Bankruptcy

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With the growing economic recession the most important factor in many individuals
lives is personal finance.  Everyone wants to avoid bankruptcy or foreclosures.
Bankruptcy is a legally declared inability filed by an individual or organization that is
unable to pay-off creditors.  The specific regulations surrounding the law are different
across various regions of the world.  A high rate of bankruptcy can create instability in
the economy and tax increases.
 
Amazingly, amongst the cases of bankruptcy each year
we always see individuals who have spent a small fortune in their lifetime.  Most often
these are famous individuals, such as actors, musicians, artists, and athletes.  Many of
these people have earned millions of dollars in their careers, but managed to lose or
spend everything.  Here is a list of 10 famous cases of celebrity bankruptcy.  

10. Suge Knight

Filed For Bankruptcy - 2006

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Suge Knight is the co-founder and former CEO of Death Row Records.  Death Row
Records featured multi-platinum artists Dr. Dre, Snoop Dogg, and Tupac.  The
production company dominated sales numbers in the early to mid-1990’s.  From 1992
to 1996
Suge Knight made millions of dollars.  He was convicted of a parole violation
and was incarcerated from 1997-2001.  In 2006, Knight was ordered to pay Lydia
Harris $107 million as she was cheated out of a 50% stake in Death Row.  He filed for
bankruptcy in 2006 and had $11 dollars in his bank account at the time.  He has since
sold Death Row Records to a New York-based company Global Music Group.  Suge
was forced for sell his home and has since started a new record label
named Blackball
Records.
   

9. Lawrence Taylor

Filed For Bankruptcy - 1998

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Lawrence Taylor was a linebacker in the National Football League for 13
seasons.  He is considered one of the greatest defensive football players of all
time.  During the 1980’s Lawrence Taylor was one of the highest paid players
in the NFL and signed a multi-million dollar contract.  In 1987, Taylor
admitted to cocaine and drug abuse.  He claims to have spent tens of
thousands of dollars a week on narcotics.  By the early 1990’s, Taylor lost all
of his money to drugs, gambling, and bad investments.  In 1998, he was
arrested for failing to pay child support and subsequently had to file for
bankruptcy.

8. Willie Nelson

Filed For Bankruptcy – 1990

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Willie Nelson is an American country singer-songwriter, author, poet, actor and
activist. Nelson was born in Abbott, Texas and grew up in a trailer park.  He reached
international fame in the 1960’s and 70’s and helped spawn the outlaw country
movement.  In the mid-1980s, Nelson, Waylon Jennings, Kris Kristofferson, and Johnny
Cash formed a group called The Highwaymen.  The group was extremely successful and
reached platinum record sales.  In 1990, the Internal Revenue Service (IRS) handed
Nelson a bill for $16.7 million in back taxes and seized most of his assets to help pay
the charges.  This caused him to immediately declare bankruptcy.
 
Later that year, he released The IRS Tapes: Who'll Buy My Memories? as a double
album, with all profits going straight to the IRS.  Many of his assets were auctioned and
purchased by friends, who gave his possessions back to him or rented them at a nominal
fee.  Nelson sued accounting firm Price Waterhouse, contending that they put him into
tax shelters that were later disallowed.  The lawsuit was settled for an undisclosed
amount and his debts were paid by 1993.

7. Bud Post

Filed For Bankruptcy – 1996

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Bud Post won the national lottery in 1988 that was worth $16.2 million.  Bud went on a
mass spending spree and declared bankruptcy 8-years after winning the money. 
He spent
everything he had on buying homes, three cars, a truck, two Harley-Davidson
motorcycles, two 62- inch Sony TVs, a camper, computers, and a boat among other
things.  All Bud needed to do was hire a financial advisor, make some wise investments,
and he could have eventually purchased anything he wished.  After filing for bankruptcy
Bud entered into a state of depression and claimed that winning the lottery ruined his
life.  He died in 2006 with no money or possessions.

6. Debbie Reynolds

Filed For Bankruptcy - 1997

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Debbie Reynolds is an American actress, singer, and dancer.  She regularly appeared in
movie musicals during the 1950s and had several hit records during the period.
Reynolds was one of the highest paid stars during the 1950’s and 60’s and soon became
a multi-millionaire.  Unfortunately, bad relationships and financial investments have
plagued Debbie Reynolds her entire life.  Her second husband Harry Karl got the pair in
serious financial trouble in the 1960’s with gambling and bad investments.  She
divorced and rebuilt her empire, but decided to purchase the Las Vegas Greek Isles
Hotel & Casino in 1993.  The business was quickly plagued by weak cash flow.
Reynolds lost everything and filed for bankruptcy in 1997. 
The hotel was sold at
auction in 1998 to the World Wrestling Federation.
 

5. Mark Twain

Filed For Bankruptcy - 1894

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Samuel Clemens is an American author that wrote many famous novels and articles.  He
published under the pen name Mark Twain and is most well known for the books The
Adventures of Huckleberry Finn and Tom Sawyer.  Twain made a substantial amount of
money through his writing, but he squandered much of it in bad investments.  Namely
the Paige typesetting machine, which was prone to breakdowns and cost him over
$300,000 in failed investment. That is equivalent to 7 million dollars today.  Twain also
lost money through his publishing house. 
He filed for bankruptcy in 1894 and
discharged all his debts, but was determined to repay the creditors.  In 1893, Mark
Twain met
Henry Huttleston Rogers who persuaded him to transfer the copyrights on
his  written works to his wife to prevent creditors from gaining possession of them.
Twain embarked on a world lecture tour and eventually paid off all his creditors in full.
He also wrote several of his more famous books after filing for bankruptcy, including
Pudd'nhead Wilson and Following the Equator.
  
   

4. Kim Basinger

Filed For Bankruptcy - 1993

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Kim Basinger is an extremely successful American actress.  In the early 1990’s she
became one of the highest paid actresses in Hollywood and averaged $10 million per
role.  In 1989, Basinger entered into on a joint venture and purchased the town of
Braselton, Georgia.  Her hopes were to establish a tourist attraction in the area.  In
1993, Basinger pulled out of the controversial film Boxing Helena after signing a
contract.  She was sued by the production company of the movie and ended up losing $8
million.  She filed for bankruptcy the same year and had to sell her $20 million
Braselton investment for only $1 million.  Braselton is now owned by developer Wayne
Mason.

3. Rembrandt

Filed For Bankruptcy - 1656

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Rembrandt Harmenszoon van Rijn was a Dutch painter who lived in the middle of the
17th century.  He is generally considered one of the greatest painters and printmakers in
European art history and the most important in Dutch history. During his lifetime,
Rembrandt lived beyond his means and often purchased art, antiques, and various
rarities.  In 1656, Rembrandt filed for bankruptcy at the age of 50.  In 1657 and 1658 all
of his assets were sold at auction, including dozens of paintings, prints, his house, and a
large collection of antiquities.  He continued to paint in the last years of his life, but was
not able to sell his work directly to the public.  He ultimately had his son take over his
business and sell the art for him.  The end of Rembrandt’s life was riddled with financial
hardship.
 

2. George Best

Filed For Bankruptcy - 1982

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George Best was a Northern Irish professional football player, best known for his years
with Manchester United.  He was one of the best footballer’s of the 1960’s and was
named the European player of the year in 1968.  George Best's extravagant lifestyle led
to a serious alcohol dependency.  He was paid a good sum of money for his play and
was also one of the most recognizable and famous individuals in England during this
era.  In 1982 Best filed for bankruptcy after trying to gain treatment for alcoholism.  He
died at the age of 59 after suffering a kidney infection that was the result of a liver
transplant.  It is reported that Best was seen drinking in the hospital after his procedure.
 

1. Mike Tyson

Filed For Bankruptcy – 2003

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Mike Tyson is one of the most storied boxers in history.  At the age of 20 he became the
youngest man ever to win the world heavyweight title.  He won his first 19 professional
bouts by knockout and 12 of them came in the first round.  Tyson became one of the
most recognizable figures in the world and would routinely receive $30 million per
fight.  It is estimated that he made over $300 million in his fighting career.  During the
1980’s and 90’s Mike Tyson’s lavish lifestyle was costing him $400,000 a month.
During his divorce he paid out $9 million in legal fees.  In 2003, Tyson filed for
bankruptcy, owing a debt of $27 million.  Like many sports figures, it became difficult
for Tyson to maintain a steady cash flow after his career.  A combination of this and the
taste for a lavish and expensive lifestyle often causes bankruptcy.
    
       

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