People are assuming that 50 is broke, especially with respect to his recent lawsuit that ordered 50 to pay a staggering $5 million to a woman, who sued over a sex tape that was leaked without her consent. Not only that–his boxing promotions company, SMS Promotions, filed for Chapter 11 bankruptcy last May.
According to court records, 50’s assets and debts were listed between f $10 million to $50 million – each – which put him automatically in Chapter 11 territory due to the monetary values.
Technically, Chapter 11 bankruptcy is the reorganization of one’s assets and debts, and isn’t an indicator that one’s finances were badly managed, but if 50 had any debts he needed to repay, his new bankruptcy status would allow him some time to repay them.
“This filing for personal bankruptcy protection permits Mr. Jackson to continue his involvement with various business interests and continue his work as an entertainer, while he pursues an orderly reorganization of his financial affairs.”
In a nutshell, the restructuring plan takes nearly two years to be approved and can then be stretched out over an additional 3 years during the restructuring process, stalling repayment for as much as five years, ultimately. This means that all creditors will have to sit and wait to be paid. During this time, there will be no liens, judgements or debt collectors to speak of.
Filing bankruptcy is usually intended for prevention. One must prove that they are not capable of maintaining their debts. Restructuring and bankruptcy will allow people the time they need to catch up.