Bankruptcy

- Assets and debts

Bankruptcy

What is Bankruptcy? It is a proceeding in a federal court in which an insolvent debtor's assets are liquidated and the debtor is relieved of further liability. This basically means that a person (or a corporation) was so far in debt that they felt a fresh start was their only option. More than a million Americans filed for bankruptcy last year, and the number continues to rise.

There are three types of bankruptcies:

"Chapter 7" - All assets are liquidated, except those that are exempt in your state (possibly a home, car, clothing, household appliances, life insurance, pension, and work-related tools). This property is sold by a court-appointed official or given to creditors.

"Chapter 11" - Intended largely for businesses. Designed to allow a business to continue operating while repaying creditors through a court-approved plan.

"Chapter 13" - If you have unsecured debts of less than $269,250 and secured debts of less than $871,551, you may be entitled to this type of bankruptcy protection, which allows you to keep certain property while you pay off your debts under the supervision of a court-appointed trustee.
All three types of bankruptcy may get rid of unsecured debts (those where creditors have no rights to specific property) and stop foreclosures, repossessions, garnishment of wages, utility service cancellations and activities of debt collectors against you. Chapter 7 and 13 bankruptcies provide exemptions that allow you to keep certain assets, though those exemption amounts vary greatly from state to state.
On the downside, it's not a "get out of debt free" card. Here are some of the disadvantages of declaring bankruptcy:

You need to file the claim and pay a fee. You may also need to pay a bankruptcy lawyer, and it can be difficult to find a good one, since some try to maximize their profits by handling cases as quickly as possible instead of giving your bankruptcy the attention it deserves.

Some debts cannot be eliminated by declaring bankruptcy, including taxes, student loans, alimony, child support, debts that resulted from fraud or willful injury and some property settlements, fines and penalties.

Your bankruptcy will remain on your record for up to ten years. This may make it difficult or impossible to obtain a credit card or a loan.
For these reasons, bankruptcy should be used only when there's no other solution (see Investors Guide University: Escaping Credit Card Debt). However, the law forbids discrimination against those who have filed for bankruptcy, so you cannot be denied a job, public housing or a driver's license on this basis.

Money Frauds and Scams

Ponzi Pyramid Scheme - The 50 billion dollar fraud by Madoff. Bernard Madoff was the former chairman of the Nasdaq Stock Market and he said that his company was just running one big 50 billion Ponzi Fraud since 1991. He was arrested and charged with one of the largest fraud schemes in Wall Street history. This giant scam have thousands of victims around the world, including major banks, hedge funds, pension funds and even charities around the world.

The US Securities and Exchange Commission (SEC) fallen down on their job to detect a $50 billion fraud in the heart of Wall Street running for 17 years. They also failed in the past with Enron and probably the regulations were not applied correctly to other companies increasing the insecurity in the financial crisis.

So Where is the Money? Many billion are disappeared in the money heaven! Is Madoff just the point of the iceberg of a huge financial Pyramid Scheme.

Some pension funds have a pyramid schema, because they need new young contributors each year to pay the old ones ... until someday it collapses. This is the same basis of a Ponzi Scheme.

Just see some of the most recent events in the Economic Bubble Bursting:

Bernard L Madoff Nasdaq relationship: Chairman of Nasdaq Stock Market in 1990, 1991 and 1993. He is a former member of the nominating committee of Nasdaq OMX. This committee suggested board members for the company.

50 billion - Madoff Ponzi Fraud

691 billion - Lehman Brothers Mortgages and others

63 billion - Losed by Enron

85 billion - AIG American International Group Bailout .

700 billion - Bank Bailout

400 billion annual deficit from the Federal Government

3000 billion - Financial cost of the Iraq War (3 trillion).
The war spent about 800 billion/year ($12 billion/month) in 2008.

With that money you can pay Lehman Brother loses or a Bank Bailout EVERY YEAR or a Auto Bailout every month. More Information:

Market maker Bernard L. Madoff arrested in $50 Billion Ponzi Fraud in 2008

Feds say Bernard Madoff's $50 billion Ponzi scheme was worst ever

A Ponzi scheme is a fraudulent investment operation that involves paying abnormally high returns ("profits") to investors out of the money paid in by subsequent investors, rather than from net revenues generated by any real business.

Bernard Madoff arrested over alleged $50 billion fraud

Madoff A Global Leader in Trading U.S. Equities. Providing a Complete Dealing Capability for US Securities in Europe. Advanced Technology and Sophisticated Traders.

The Securities and Exchange Commission hasn’t examined Madoff’s books since he registered the unit with the agency in September 2006.

Madoff fraud case raises questions about SEC.

SEC - Securities and Exchange Commission - Must protect investors through administering the SEC's nationwide examination and inspection program to detect fraud and other violations of the securities laws.

Geneva banks loses more than $4 billion to Madoff. More victims in the scam: Steven Spielberg, Carl Shapiro (Mets Nueva York)

The private Swiss bank Reichmuth and Co says it has 385 million Swiss francs ($327 million) at risk in the case of U.S. financier Bernard L. Madoff

Saudi's Prince Alwaleed lost $4B this year - The Article said the world's 50 richest Arabs lost a combined $25 billion amid the global meltdown,

U.S. to Take Over AIG in $85 Billion Bailout with Central Banks dollars Inject

Spanish investors could have up to 3 billion euros of exposure to funds managed by Madoff. Spain's Grupo Santander SA.

The growing list of financial groups exposed to the alleged $50 billion fraud surrounding Wall Street trader Bernard Madoff. Royal Bank of Scotland ($595 million), Man Group ($360 million) , Nomura Holdings Inc (($302 million) ,
HSBC Holdings Plc ($1 billion), Natixis of France ($605 million) , Italy's second-biggest bank, UniCredit SpA (75 million euros), BNP Paribas ($350 million). Group Santander Spain ($2.1 billion), Reichmuth ($329.1 million)

Is Wall Street just one Ponzi Pyramid Scheme?