Giuliani Seeks to Amend Bankruptcy to Speed Asset Sale, But Preserve Future Income
Rudolph W. Giuliani told a bankruptcy court on Monday that he wants to sell his assets to pay his creditors, including two Georgia election workers he defamed in his efforts to keep former President Donald J. Trump in office after the 2020 election.
Mr. Giuliani asked the bankruptcy court to convert his case from Chapter 11 to Chapter 7, which would put an independent trustee in charge of his assets, similar to what creditors had requested.
Mr. Giuliani, who filed for bankruptcy in December, has listed about $11 million in assets, most of them from two properties he owns in New York and Palm Beach, Fla. In court documents, he has disclosed that he owes about $153 million to about 20 people and companies, including $148 million to two election workers, Ruby Freeman and Shaye Moss.
After months of absent, late and incomplete filings, lawyers for his creditors recently asked the court to hold the former New York City mayor in contempt of court and impose fines. They have previously raised concerns that he is hiding income. Last month, they asked the court to appoint an independent trustee to take over Mr. Giuliani’s personal and business finances.
“It’s not going to be fun for him,” said Susan Block-Lieb, a professor at Fordham Law School in New York who teaches bankruptcy law. “Chapter 7, this is not Club Med.”
Since filing for bankruptcy, Mr Giuliani, formerly Mr Trump’s personal lawyer, has been unable to come up with a plan for a monthly budget and how to repay his creditors.
If the judge agrees to convert the case to Chapter 7, he doesn’t have to do that. The independent trustee takes over. The trustee is selected by the U.S. Trustee’s Office, a division of the Department of Justice responsible for ensuring that debtors and creditors are treated fairly in bankruptcy proceedings.
“Mayor Giuliani is simply pursuing available options to combat a wholly partisan and politically motivated proceeding,” his spokesman, Ted Goodman, said in an email about the filing. Mr. Giuliani faces criminal charges in Georgia and Arizona for his role in the effort to overturn the 2020 election results.
According to Adam Levitin, a professor of bankruptcy law at Georgetown University Law School, Mr. Giuliani, who is pursuing his case under Chapter 7, would have to turn over nearly all of his current assets to his creditors but would be allowed to keep his future income.
“He’s going to lose almost everything he has now,” Mr. Levitin said.
Alex Jones, the Infowars conspiracy theorist who spread lies about the 2012 Sandy Hook school shooting, took a similar step in his own bankruptcy case.
In recent months, Mr. Giuliani’s creditors have demanded details about his businesses and issued a flurry of subpoenas to people and entities with whom he has worked. One of the most recent was one sent to Mike Lindell, the Republican donor and pillow magnate.
In a filing last month, Mr. Giuliani revealed that Mr. Lindell, the CEO of MyPillow, paid one of Mr. Giuliani’s companies to sponsor his blogs. Mr. Lindell also spread the lie that Mr. Trump was the winner of the 2020 presidential election.
Mr. Giuliani’s creditors have questioned whether he accurately appraised some of his assets, including his three New York Yankees World Series rings. The trustee will now administer those appraisals and sell them for a fair price, Mr. Levitin said. If the trustee determines that Mr. Giuliani deliberately concealed assets in violation of bankruptcy law, the former mayor could face criminal charges.
Representatives for Ms. Freeman and Ms. Moss did not immediately respond to requests for comment.
