The concept of bankruptcy – seeking legal relief for one’s debts, whether personal or in business – dates back at least to the 1500s if not earlier. The term comes from the Italian “banca rotta,” or “broken bench” – perhaps a reference to a 16th-century custom of literally breaking the bench on which a person of importance sat to signify his disgrace.
Bankruptcy may still be considered disgraceful, but far more often these days it is seen as a useful tool for allowing a troubled business to restructure itself or a heavily indebted individual to make a fresh start. The specifics vary from country to country, but in the U.S., there are half a dozen main types – the most common of which are Chapter 7, which calls for liquidation of a business, and Chapter 11, which is aimed at reorganization.
Whatever the type, bankruptcies are on the rise in this country. According to the American Bankruptcy Institute, filings of all types increased by 17% between March 2022 and March of this year, while Chapter 11 filings rose a stunning 79%. The lingering effects of the pandemic undoubtedly played a hand. (By mid-2021, these were some American brands that went bankrupt during COVID.)
If there is any solace for those who have been forced to file for bankruptcy, it might be in the fact that they have plenty of famous company. Over the decades, many celebrated writers, actors, musicians, sports figures, and more have been forced by circumstance to go bankrupt. In most cases, they made huge amounts of money during the heights of their careers but spent even greater amounts, or else made bad investments. (Here are 20 celebrities who died broke.)
To assemble a list of the biggest celebrity bankruptcies in history, 24/7 Tempo consulted numerous sources, including MSN, CBS, the Los Angeles Times, Eonline, and Yahoo!. Information on recordings by musical figures came from Billboard and other industry sources. We focused on celebrities whose debts exceeded $1 million, and includes almost exclusively figures in the entertainment and athletic fields. Two exceptions are famed author Mark Twain and Australian businessman Alan Bond, who became a national celebrity by bankrolling the Australian yacht that won America’s Cup in 1983.
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