Donald Trump’s Companies Filed For Bankruptcy 4 Times
Trump still touts his business sense and wealth as qualifications for president.
Donald Trump’s Bankruptcy History
Trump has built an American empire from Las Vegas to New York with towering hotels and sparkling casinos. Forbes estimates he’s worth $2.7 billion. But not all of Trump’s business ventures have been constant money-makers. In 1991, 1992, 2004, and again in 2009, Trump branded companies or properties have sought Chapter 11 protection.
“I’ve used the laws of this country to pare debt. … We’ll have the company. We’ll throw it into a chapter. We’ll negotiate with the banks. We’ll make a fantastic deal. You know, it’s like on ‘The Apprentice.’ It’s not personal. It’s just business,” Trump told ABC’s George Stephanopoulos last Thursday.
A business declaring bankruptcy is nothing new in corporate America, where bankruptcy is often sugar-coated as “restructuring debt.” But it might seem alarming to everyday Americans who can’t get a bank to restructure their home loans. If you want to get Donald Trump hot under the collar, accuse him of declaring bankruptcy.
Doug Heller, the executive director of Consumer Watchdog, said Trump is the “most egregious, almost comical example” of the disparity between what the average American faces when going through bankruptcy and the “ease with which the very rich can move in and out of bankruptcy.”
“I’m a much bigger businessman. I mean, my net worth is many, many, many times Mitt Romney’s,” Trump said.
No Bankruptcy Is Not Synonymous With Success
Conversely, the absence of bankruptcy declarations is not an indicator of success, as many businesses fail without going through bankruptcy proceedings. A failed business may simply cease operations with the owners and investors absorbing the losses a troubled business on the brink of going under may seek to merge with another company that has the resources to keep it afloat and out of bankruptcy or a dying business may be bought up by another, stronger company, seeking to breathe new life into it or simply to acquire its assets.
And since many business conglomerates comprise multiple companies each of which may offer many different product lines a given company or product may fail spectacularly and rack up losses in the hundreds of millions of dollars without necessarily sending their corporate parents reeling into bankruptcy.
Finally, all bankruptcies are not created equal. A small startup partnership that doesnt quite take off soon enough and seeks bankruptcy protection is quite a different kettle of fish than the corporate entity that is mismanaged so badly and/or for so long that it racks up billions of dollars in debt before going Chapter 11.
Donald J Trump Foundation
During the 2016 U.S. presidential election, media began reporting in detail on how the Donald J. Trump Foundation was funded and how Donald Trump used its funds. The Washington Post in particular reported several cases of possible misuse, self-dealing and possible tax evasion.
Regarding the various irregularities in the Trump Foundation, former head of the Internal Revenue Service’s Office of Exempt Organizations Division Marc Owens told The Washington Post: “This is so bizarre, this laundry list of issues…. It’s the first time I’ve ever seen this, and I’ve been doing this for 25 years in the IRS, and 40 years total.” Trump spokesperson Boris Epshteyn said that Trump did not knowingly violate any tax laws.
The office of New York State attorney generalEric Schneiderman investigated the foundation “to make sure it’s complying with the laws governing charities in New York.” The Trump Foundation was in fact found to have committed fraud and misappropriated funds, and was ordered to be shut down.
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How Many Casinos Did Donald Trump Bankrupt
byMonellaNovember 24, 2020, 12:56 pm
Donald Trump, the ex-president of the United States, has always been projected as a successful businessman. He stated a net worth of $10 billion from his various companies, but many of them went bankrupt. As stated by the critics, one of the main reasons behind this is his management strategies and reckless attitude towards the work. However, people working with him say that he efficiently used the federal laws in his favor, which is a clear depiction of his keen business understanding.
According to several research and interviews conducted, it was found that Trump invested a minimal amount of his own money in the venture. He shifted his debt to the casino slots, earned millions of dollars in salary and other payments. It means his bankruptcys main burden fell on the investors and other stakeholders associated with his companies.
The Six Trump Company Bankruptcies
Donald Trump has made huge sums of money in his lifetime, but heâs also lost astronomical amounts. Between 1990 and 1994, for instance, Trumpâs businesses lost more than $804.4 million, even while similar companies saw profits. During that time, and throughout his career, Trump has strategically used bankruptcy to keep himself and his businesses afloat.
Trump-owned businesses have filed for bankruptcy six times so far. Each time, the bankruptcies freed Trump from debt and allowed him to start his next venture. He famously went on to occupy one of the worldâs most powerful positions: President of the United States.
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Judith And Nicolas Jacobson
Now divorced, the Jacobsons were a married couple who previously owned a chandelier business in West Palm Beach, Florida. In 2004, Trump ordered three fixtures worth $34,000 for his Mar-a-Lago resort from them, but then refused to pay in full, saying the Jacobsons work was shoddy, WSJ reports. They denied this claim but facing endless legal wrangling, the couple settled.
A review of Palm Beach County court records showed no other payment disputes involving Classic Chandeliers. The shop later closed. Mr. Jacobson died in 2015, notes the WSJ.
Trump defends his history of payment disputes as simply the expected cost of being a tough negotiator in a cutthroat business. The WSJ article, in particular, offers Trumps camp ample space to respond. They strongly defend the tactics as hard but fair , but the paper notes that they stood out as particularly aggressive in the industry and in the broader business world.
Will Trumps treatment of contractors affect whether or not you decide to vote for him?
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Trump Castle And Trump Plaza Casinos
Before he opened the Taj Mahal, Trump owned two other Atlantic City casino resorts: the Trump Castle Hotel & Casino and the Trump Plaza Casino. When the Taj Mahal opened, it became a competitor for Trump Castle and Trump Plaza. Income dropped at the older casinos. As a result, both properties filed for Chapter 11 bankruptcy in March 1992, shortly after the Taj Mahal filing.
Trumpâs three Atlantic City casinos had many of the same creditors. In some cases, two or all three properties served as collateral for the same loan. Even though each property had a separate bankruptcy case, Trumpâs negotiations with the creditors generally involved all three casinos at the same time. Trump still refers to these three cases as one combined bankruptcy. This confusion is probably why sources sometimes refer to Trumpâs four bankruptcies, instead of six.
Together, the three casinos were tied to around $3.4 billion of debt. Trump was personally responsible for about $900 million of that amount. As part of the Chapter 11 restructuring, Trumpâs creditors agreed to lower his interest rates and give him additional time to repay his debts. In exchange, Trump agreed to give up 50% of his ownership in all three casinos to his creditors. He also agreed to sell a significant chunk of his assets and turn the sale proceeds over to the creditors, including:
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Trump Castle Associates 1992
In less than a year he was back in bankruptcy court for his other Atlantic City casinos. This bankruptcy included the Trump Plaza Hotel in New York, the Trump Plaza Hotel and Casino in Atlantic City as well as the Trump Castle Casino Resort. He gave up half his interest in the New York Plaza to Citibank, but retained his stake in the casinos.
Eight Us Presidential Bankruptcies You May Have Missed
When we think of the office of president, we often think that only wealthy men can attain it. Barack and Michelle Obama have signed deals worth tens of millions of dollars, George W. Bush retired to his Texas ranch, Bill Clinton founded the Clinton Foundation, and Jimmy Carter still teaches Sunday school in Georgia. We have the idea that those who leave the office, and those who come to it, have little to worry about in terms of finances and comfort in their post-political years. However, while distinctly in the minority, at least eight presidents have experienced financial hardship and even presidential bankruptcies.
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First Federal Bankruptcy Law
In 1800, Congress passed the first federal law relating to bankruptcy, called the Bankruptcy Act of 1800. Similar to many state bankruptcy systems at the time, the Bankruptcy Act of 1800 was very creditor-oriented and only permitted involuntary bankruptcies of merchant debtors. There were no provisions for individuals to file on their own. Some crafty debtors figured out that they could ask a friendly creditor to initiate the bankruptcy case. However, due to many complaints of corruption and favoritism, the law was repealed just three years later. The states continued to run various bankruptcy systems in the absence of federal law.
Famous People Who Have Filed For Bankruptcy
Bankruptcy is something we have all heard about. Maybe we even know someone who has had to go down that road.
For some, their finances have gotten so bad that they wonder if bankruptcy is the only option left. As you consider that option, there is probably shame and fear and a huge weight on you that you have allowed it to get this bad.
You are right: bankruptcy is a last resort option and should only be taken with the determination that it is never going to happen again. You have to commit to change, no debt and even counseling, if you really want it to get fixed. It took a lot of work to get into bankruptcy and will take a lot to get out of it.
But the shame has to stop. The guilt isnt going to help you starting over, it will just keep you in the same mindset that got you trapped in the first place.
Did you know that there are a lot of famous people who have declared bankruptcy at one point or another?
Lets take a look at some celebrities who had to start over:
Kim Basinger Oscar winner and ex-wife of Alec Baldwin, Kim Basinger was forced into bankruptcy after a breach of contract lawsuit. She declared $8 million in her bankruptcy filing and was able to settle 4 years later and continue on with her acting career.
These twenty celebrities are just a few of the examples of people who have had to go through bankruptcy court. The range of debt is extreme to much more extreme.
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Use Of Bankruptcy Laws
Trump has never filed for personal bankruptcy, but hotel and casino businesses of his have been declared bankrupt four times between 1991 and 2009 to re-negotiate debt with banks and owners of stock and bonds. Because the businesses used Chapter 11 bankruptcy, they were allowed to operate while negotiations proceeded. Trump was quoted by Newsweek in 2011 saying, I do play with the bankruptcy laws â theyre very good for me as a tool for trimming debt. These types of bankruptcies are common in the business world for restructuring to avoid having to close a business. In the case of Trumps bankruptcies, three were tied directly to gaming industry, which as a whole had suffered during the time the bankruptcies were declared.
According to a report by Forbes in 2011, the four bankruptcies were the result of over-leveraged hotel and casino businesses in Atlantic City: Trumps Taj Mahal , Trump Plaza Hotel , Trump Hotels and Casino Resorts , and Trump Entertainment Resorts . Trump said Ive used the laws of this country to pare debt. Well have the company. Well throw it into a chapter. Well negotiate with the banks. Well make a fantastic deal. You know, its like on The Apprentice. Its not personal. Its just business. He indicated that many great entrepreneurs do the same.
Were Watching Trumps 7th Bankruptcy Unfold
As a businessman, Donald Trump ran 6 businesses that declared bankruptcy because they couldnt pay their bills. As the president running for a second term, Trump is repeating some of the mistakes he made as a businessman and risking the downfall of yet another venture: his own political operation.
In the 1980s, Trump was a swashbuckling real-estate investor who bet big on the rise of Atlantic City after New Jersey legalized gambling there. He acquired three casinos that by 1991 couldnt pay their debts. The Taj Mahal declared bankruptcy in 1991, the Trump Plaza and the Trump Castle in 1992. Lenders restructured the debt rather than liquidate and Trump put his casino holdings into a new company that went bankrupt in 2004. The company that emerged from that restructuring declared bankruptcy in 2009. Trumps 6th bankruptcy was the Plaza Hotel, which he bought in 1988. It went bankrupt by 1992.
Trumps surprise victory in 2016 paralleled the arrival of the brash upstart in Atlantic City more than 30 years earlier. But in the fourth year of his presidency, the Trump operation is once again reeling. Voters give him poor marks for handling the coronavirus crisis, underscored by an outbreak at the White House that infected Trump himself. Democrat Joe Biden is beating Trump is most swing states and an Election Day blowout is possible. Trump has suggested he wont leave office if he loses, threatening a constitutional crisis and his own political legacy.
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The Bankruptcy Filings Of Donald Trump
SOME THINGS YOU PROBABLY DONT KNOW ABOUT BANKRUPTCY AND DONALD TRUMP
PART ONE OF TWO PARTS
There has been much recent mention in the mainstream news and among other political opponents of Donald Trump, namely Carly Fiorina, of the numerous Bankruptcies that Donald Trump was involved. Although Donald Trump never personally filed Bankruptcy, a number of Corporations in which Donald Trump had majority control and ownership, filed Bankruptcy, specifically Chapter 11 Bankruptcy.
Trump Corporations have filed Bankruptcy four times. Each Bankruptcy involved Trump Resorts, Hotels and Casinos located in the Atlantic City area, in New Jersey. Mr. Trump has, on numerous occasions, defended the Bankruptcies, stating that his Enterprises were victim to the general economic malaise that has befallen New Jersey, and Atlantic City, in particular. Trumps Corporations in Atlantic City are not the only Hotels and Casinos in Atlantic City that experienced severe financial hardship. Trump further defends his position by touting his good timing in removing himself and his business efforts away from Atlantic City, before Atlantic City descended much further into economic disaster.
In addition, Mr. Trump will often mention that although a number of his Atlantic City projects did file Bankruptcy, most have experienced successful restructuring, which is unusual for Corporations that file Chapter 11 Bankruptcy, and he has hundreds of other business ventures that have been successful.