How Many Times Did Trump File Bankruptcy

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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Corporate Bankruptcy As Business Strategy

Trump was recently quoted as stating, …basically Ive used the laws of the country to my advantage and to other peoples advantage. What he means by that is that Chapter 11 can shelter a company from complete destruction. Under the umbrella of corporate bankruptcy, a company thats struggling can restructure without the pressure of liquidating assets and making creditors unhappy.

Its a tactic that Trump has made popular largely because of his big persona and brand name, but its not a strategy that he enjoys and owns alone. Numerous companies have gone through corporate bankruptcy for the same reason – because its much better than losing money on a sinking ship. Allowing a company to restructure under the Chapter 11 clause will bring in more money than liquidating that companys assets, and this is what most creditors want to see.

But can this strategy work for companies that are much smaller in size? Does declaring corporate bankruptcy work for a mom and pop shop? Heres where it gets sticky.

The Backstory On Donald Trump’s Four Bankruptcies

GOP frontrunner Donald Trump, preparing for his second debate on Wednesday, has never declared bankruptcy. His businesses have, though — four times. Find out what went wrong.

NEW YORK — Donald Trump has never declared bankruptcy, but his businesses have — four times.

The real estate mogul, television star and Republican presidential frontrunner filed for corporate bankruptcy in 1991, 1992, 2004 and 2009. Three of the cases were related to his casino and hotel properties in Atlantic City, N.J.

And even though more than six years have passed since Trump had his last run-in with Chapter 11, it remains a touchy subject. Trump was quick to clarify at the Republican presidential debate hosted by Fox News in August that he had never filed for personal bankruptcy. Instead, he cast his moves as part of his solid business acumen.

“Out of hundreds of deals — hundreds — on four occasions, I’ve taken advantage of the laws of this country, like other people,” he said. “The difference is, when somebody else uses those laws, nobody writes about it. When I use it, it’s like, ‘Oh, Trump, Trump, Trump.’ The fact is, I built a net worth of more than $10 billion. I have a great, great company. I employ thousands of people. And I’m very proud of the job I did.”

Overall, the Donald is no stranger to business maneuvers that, depending on whom you ask, can appear either particularly savvy or ripe for criticism. His history with bankruptcy is no exception– take a look at the four cases below:

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‘keep The Donald Afloat’

” could have simply taken everything he had right then, but they wanted his cooperation,” said Lynn LoPucki, a bankruptcy expert and professor at UCLA Law School. “There’s that old saying, ‘If you owe your banks a little, you’re at their mercy. If you owe the banks a lot, the banks are at your mercy. They saw the best way for him to repay the money was to keep the Donald afloat.”

The Donald struck a deal with the banks to hand over half his ownership, and half of the equity, in the casino in exchange for a lower interest rate and more time to pay off his debt. He sold off his beloved Trump Princess yacht and the Trump Shuttle airplane to make his payments, and his creditors put him on a budget, putting a cap on his personal spending.

“The first one was a really big hit for him. They had him personally, and he ended up taking substantial losses in that bankruptcy. He also had the humiliation of having some bankers deciding how much money he could spend — the numbers are just astonishing — the amount of his monthly budget,” LoPucki said.

John Pottow, a bankruptcy expert and law professor at the University of Michigan, said banks would often agree to lose millions in reorganizations like Trump’s to prevent the massive losses they would incur if they foreclosed on the property.

“Banks will take considerable haircuts,” Pottow said. “It’s sort of like you have a sick patient so you cut off a couple toes to stop the gangrene. Now he’s missing a few toes, but he’s still alive.”

Business Career Of Donald Trump

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Donald Trump is an American businessman and television personality. He was the 45th president of the United States. He began his real estate career at his father’s company, Elizabeth Trump and Son, which he later renamed the Trump Organization. He rose to public prominence after concluding a number of highly publicized real estate deals in Manhattan, and his company now owns and licenses his name to lodging and golf courses around the world. Trump partly or completely owned several beauty pageants between 1996 and 2015. He has marketed his name to many building projects and commercial products. Trump’s unsuccessful business ventures have included numerous casinos and hotel bankruptcies, the folding of his New Jersey Generals football team, and the now-defunct Trump University.

After being inaugurated as U.S. president in January 2017, Trump resigned all management roles within the Trump Organization, and delegated company management to his sons Donald Jr. and Eric. However, Trump retained his financial stake in the work document, leaving ongoing concerns about possible conflicts of interest.

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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.

Trump Has Filed For Six Business Bankruptcies

Trump, however, filed for bankruptcy regarding these companies:

Critics cite that the Trump corporate bankruptcies are examples of his inability to manage, his recklessness, and poor business acumen. Trump answers that criticism by stating he has used federal laws to protect his business interests. This idea is an example, he says, of his business insight and outstanding intelligence. Trump stated in August 2015:

I have used the laws of this country just like the greatest people that you read about every day in business have used the laws of this country, the chapter laws, to do a great job for my company, my employees, myself and my family.

In reporting from the New York Times, in 2016, Trump put up a small amount of his own money, moved personal debts to the casinos, and was awarded millions of dollars in salary, payments, and bonuses. The Times countered by sharing that the burden of his failures fell on the investors and those who bought into his business acumen self-assessment.

Three of the casino-related bankruptcies came about during the time of the early 1990s recession and the Gulf War crisis. Both of these situations made keeping Atlantic City, New Jersey gambling facilities face some hard times. At about this same time, Trump entered into a project that involved a Manhattan hotel and two casino holding companies.

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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.

It Will Be The Best 1996

Donald Trump has said that his brushes with financial disaster in the early 1990s reminded him of a lesson his father had taught him: Do not leave yourself on the hook for loans.

My father knew, like I knew, you dont personally guarantee, Mr. Trump is quoted saying in TrumpNation: The Art of Being the Donald, by Timothy L. OBrien, a former reporter for The Times. Ive told people I didnt follow my own advice.

His agreements with lenders and the two casino bankruptcies in those years still left Mr. Trump personally responsible for more than $100 million in debt, and his agreements had only delayed the day of reckoning to June 30, 1995.

He dealt with that danger by first shifting much of his personal debt onto his casinos, then onto a new group: .

Step 1 came in 1993, when his company sold more junk bonds, adding another $100 million in debt to the Trump Plaza casino. More than half of the new money went to pay off Mr. Trumps unrelated personal loans.

Then, in June 1995, with the risk of being forced into bankruptcy just weeks away, Mr. Trump shifted ownership of the Plaza casino to a new, publicly traded company: Trump Hotels and Casino Resorts. In the initial public offering, 10 million shares were sold at $14. At the same time, the company also sold another $155 million in junk bonds, at a 15.5 percent interest rate.

Indeed, the company posted losses of $66 million in 1996, $42 million in 1997 and $40 million in 1998. Those losses would continue.

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What The F*ck How The Rich Go Bankrupt And Stay Rich

Think bankruptcy and you think losing your home, your car, and your prospects. Bankruptcy is considered to be the ultimate symbol of business and financial failure.

For most of us, thats exactly what it means. But for the rich, it doesnt necessarily mean the end. On the contrary, the rich tend to stay rich even after bankruptcy, in many cases.

Used Law To Protect Interests

Critics have cited the Trump corporate bankruptcies as examples of his recklessness and inability to manage, but the real estate developer, casino operator, and former reality-television star says his use of federal law to protect his interests illustrates his sharp business acumen.

Trump said in August 2015:

“I have used the laws of this country just like the greatest people that you read about every day in business have used the laws of this country, the chapter laws, to do a great job for my company, my employees, myself and my family.

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Presidential Campaign Of 2016

Trump announced he was seeking the Republican presidential nomination on June 16, 2015. His speech was mostly negative and touched on themes such as illegal immigration, terrorism and the loss of jobs that would resonate throughout his campaign over the course of the election cycle.

The darkest lines of Trump’s speech include:

• “The U.S. has become a dumping ground for everybody elses problems.”
• “Our country is in serious trouble. We dont have victories anymore. We used to have victories, but we dont have them.”
• “When Mexico sends its people, theyre not sending their best. Theyre not sending you. Theyre not sending you. Theyre sending people that have lots of problems, and theyre bringing those problems with us. Theyre bringing drugs. Theyre bringing crime. Theyre rapists. And some, I assume, are good people.”
• “Sadly, the American dream is dead.”

Trump largely funded the campaign himself.

He was criticized by many leading conservatives who questioned whether he was really a Republican. In fact, Trump had been registered as a Democrat for more than eight years in the 2000s. And he contributed money to the campaigns of Bill and Hillary Clinton.

What Is At Stake For Donald Trump Its Certainly Not Just The Election

The brilliant businessman must repay more than $400m within four years. Next weeks vote could determine whether he can

Going bankrupt once is unfortunate. Going bankrupt twice looks like carelessness. Driving your companies into bankruptcy six times, however, as Donald Trump has done, makes you a brilliant businessman.

That is according to the US president, anyway. Trump, a self-described king of debt, is proud of his multiple business bankruptcies, boasting frequently about how he has brilliantly exploited corporate bankruptcy laws in order to wriggle out of his companies financial obligations. Time and time again, Trump has managed to make others employees, investors and banks pay for his failures. Trump, who has never declared personal bankruptcy, has been able to protect his own assets and move on to the next fiasco.

But is Teflon Dons luck finally running out? With just days to go until the US election, Trump is facing a potentially crippling combination of financial stressors. His business empire has been hit hard by the pandemic according to a recent report by the Washington Post, Trumps golf clubs and hotels are practically empty. They were not doing that well before the pandemic: the New York Times investigation into Trumps taxes last month found his businesses were losing money at a staggering rate.

• Arwa Mahdawi is a Guardian columnist

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