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Lindsey Lohan’s Mom Files for Bankruptcy

So often is the case that a famous person bites off more than they can chew.  Whether it be houses, jewelry, or friends, people who have money seem to spend money.  Unfortunately, the latest celebrity (kind of) to file for bankruptcy is Dina Lohan.  Dina has been an actor, producer, talent manager, singer, and more in her career which has netted her an estimated $1.3 million.

The Divorce

In 2007, Dina’s divorce was finalized.  Her 22-year marriage to Scott Lohan was marred by alcohol, cocaine, and physical abuse.  Dina maintained custody of their 3 younger kids and the kid’s childhood home which had a mortgage of $1.5 million.

Property Debt

As previously stated, Dina got to keep the home and the $1.5 million in debt that came with it.  Dina has made a decent amount of money throughout her career, but in 2017 the mortgage became too much for her to handle.  The house went into foreclosure even though Lindsay gave her $40,000 to help.  Dina eventually lost the home because she did not respond to the suit within 90 days of the suit filing.  If Dina had read “So You Are Behind on Your Mortgage Payments and You Are Facing Foreclosure” she would have known better.

Taxes and Other Debt

Dina owes thousands in taxes to New York and California.  It is estimated that she owes $4,651 to California and at least $9,000 to New York state.  In addition to state taxes, Dina owes over $45,000 to the IRS, over $10,000 for her Honda, and over $10,000 to her kid’s high school.

Debt can feel insurmountable.  Debt can BE insurmountable.  When this is the case, bankruptcy is a perfectly valid option.  It is a legal tool designed to help an individual (or business) get out from under the thumb of creditors.  People can be forced to file for bankruptcy for many reasons and, while it is not ideal, it can help you move on with your life.  If you are constantly being harassed by creditors and you are ready for a change, contact Elias Dsouza at Dsouza and Strachan Lawgroup Group.  Elias has been helping individuals and businesses navigate the complex process of filing for bankruptcy for over 15 years.  He has the skills to enable you to move forward with your life.

Florida Contractors Face Fines from OSHA for Bridge Collapse in March

Employers, especially those in construction, almost always say “the safety of our employees is our number one priority”.  Most of the time, this is true.  Unfortunately, sometimes it is not true and people get hurt as a result. 

What Happened

Florida International University (FIU) paid several contractors to build a pedestrian bridge over Tamiami Trail (U.S. route 41).

  • The main span of the bridge was lifted into place on March 10, 2016.
  • On March 13th, the engineer in charge of the project reported cracking on the north section of the main span. The engineer left a voicemail with the Florida Department of Transportation (FDOT) which explained that the cracks were not a safety issue and could be repaired later.
  • On March 15th, engineers were adjusting tension on a portion of the bridge and it collapsed killing 6 people and injuring 9 others.

The Investigation

The National Transportation Safety Board (NTSB) sent a team to the site the day of the collapse.  Over the course of the next two years, the NTSB and FDOT investigated the pieces of the bridge, all communications to and from the contractors and governing bodies, and all paperwork filed in preparation for building.

After two years of investigation, it was determined that the contractors were negligent in their assessment that the cracks in the bridge were benign and they failed to protect their employees.  The Occupational Safety and Health Administration (OSHA) was given the go ahead to propose just under $90,000 in fines to be evenly dispersed amongst the contractors.  In addition to the fines, civil suits are being filed in 2018 and plaintiff’s compensation for damages could rise to over $1 billion.

If you feel that your employer has put you in an uncomfortable position or in outright danger, you may have options.  Whether it be discrimination, physical danger, or some other workplace transgression, if you need guidance, contact Elias Dsouza at Dsouza and Strachan Lawgroup Group for a free consultation.  Elias has the skills and experience to defend you.

The Latest Refugee Settlement News

The United States Resettlement Program (USRP) is a joint effort involving the Department of Homeland Security, the Department of Health and Human Services, and State Department.  Its purpose is to manage refugees seeking a life in the United States.  Candidates for participation in this program are sponsored by U.S. embassies.  The President is responsible for determining the annual number of refugees to be placed in the United States.

The Declining Number of Refugees Allowed to Relocate

From 2016 to 2018 the number of refugees allowed to participate in this program were:

  • 2016 – 85,000
  • 2017 – 54,000
  • 2018 – 45,000

45,000 is the lowest number of refugees allowed to participate in this program since its inception.

The Process of Resettlement

The process of resettlement typically takes 2.5 years and typically follows this path:

Security

  • Pre-screening by the Resettlement Support Center.
  • On-site interview by the Refugee Corps.
  • Security clearance and fingerprinting.

Placement (30-90 days in the U.S.)

  • Placement allocations utilizing each of the 9 national voluntary agencies.
  • Cultural orientation and departure processing.
  • Initial reception and placement.

Transition

  • Cash and medical assistance.
  • Employment services and medical screening.
  • Beginning specialized programs to cope with transition.

Do You Need A Lawyer to Navigate This Process?

If you or your family are considering resettlement utilizing this program, it is possible to do it without the services of a lawyer.  All of the paper work and process are outlined here on the Office of Refugee Settlement website.  However, resettlement is becoming increasingly competitive and complex.  The number of refugees allowed to resettle has dropped over 50% and the number of global refugees has risen over 50%.

While the resources are available to work through immigration without a lawyer, you should understand that this could lead to costly errors and confusion.  Resettlement is complicated, competitive, and important.  If you or your family is trying to navigate legal immigration to the United States, consider contacting Elias Dsouza at Dsouza and Strachan Lawgroup Group for a free consultation.  For over 15 years, Elias has been guiding families through the complex process of legal immigration.

How a Hurricane Can Blow Away Your Credit Score

With Hurricane Florence pummeling the east coast, for many, priorities are being shifted.  When you think of a hurricane, you think of the dangers of high-speed winds, rising water levels, and wide spread homelessness.  What you may not think of is the effect a hurricane can have on your credit score.  While this certainly takes a back seat to safety, it should when you are preparing for the storm.

The data used in this post are from a report released in 2017 by the Kansas City Fed, “Financial Vulnerability and Personal Finance Outcomes of Natural Disasters“authored by Kelly Edmiston.

Who is at risk?

People with relatively high credit card utilization and unpaid bills are at risk of losing more than 80 points on the credit score if they are directly hit by a Category 1 hurricane.  In 2007, Hurricane Humberto slammed into the coast of Texas.  In areas of coastal Texas where:

  • 1% of people had unpaid bills, the average drop in credit score was 16.2%.
  • 5% of people had unpaid bills, the average drop was 81.2 points.
  • People had 10% credit card utilization, the average drop was 17.9 points.
  • People had 40% credit card utilization, the average drop was 71.2 points.

The average drop in credit score for all areas affected by Hurricane Humberto was 46.4 points.

How Can You Avoid or Reduce Your Risk?

The author of the report, Kelly Edmiston, addresses one of the main reasons people find themselves unprepared in the path of a hurricane.  He says, “The problem’s not so much that they’re making mistakes in preparing for a disaster, but they underestimate the likelihood that they’ll be affected.”  Suggestions for preparing include:

  • Paying your bills before the hurricane arrives. You may not be able to pay online, by phone, or by mail if you wait.
  • Notifying your credit card companies that you have to evacuate. This could get you an extension if you are late and they will know not to decline your charges if you relocate to a relatively unusual place.
  • Getting cash before the storm arrives. Many places may not be able to accept credit or debit cards and this can prevent you from over-utilizing your cards.

It can be extremely difficult to prepare for a natural disaster.  Sometimes, even being prepared is not enough.  If your credit has been affected by a hurricane, unexpected job loss, or for any other reason, you may need help getting back on track.  If you want creditors to stop calling day and night, contact Elias Dsouza.  He has the skills and experience to get you back on track.

A Quick Guide to Puerto Rico’s Bankruptcy

Puerto Rico became a United States territory in 1898.  The islands economy relied mostly on agriculture.  However, after World War II, the United States tried to modernize the territory by moving businesses there.  Of course, these businesses moved to take advantage of the lenient tax laws and cheap labor ultimately not improving the Puerto Rico in the long run.

The Economic Rise and Decline

In the 1970’s the federal government passed a tax law with a large loop hole that allowed huge businesses to operate in Puerto Rico while paying almost no taxes.  This was great for the citizens of the territory, but it created an enormous tax deficit for the U.S. government.  In 2006, the law was completely repealed and most of the businesses operating in Puerto Rico left leaving thousands of people jobless and debt on the rise.

Underground Jobs

It is estimated that one-third of the Puerto Rican job force operates “under the table” which is to say that the income on these wages is not traceable and therefore not taxable.  This lack of infrastructure leads to a tax deficit for the territory.

How Does All of This Lead to Bankruptcy?

Due to the lack of tax revenue, the Puerto Rican government cannot sustain itself.  Unable to collect taxes from its citizens, the government sold $61 billion in bonds to some of the largest firms on Wall Street.  That total is now up to $70 billion.  I addition to the debt associated with bonds, Puerto Rico owes its government employees over $43 billion in pension payments.  That puts Puerto Rico over $120 billion in the red.  Just to offer some context, when Detroit, Michigan filed for bankruptcy in 2013, it (only) owed about $14 billion.

While the magnitude of the debt is far different than a person or small business may experience, the solution for this type of bankruptcy is similar.  Currently, the United States government is working with leadership in Puerto Rico to put together a bankruptcy plan that their creditors and the court can agree to.

You may not be $120 billion in debt, but maybe you are behind on loan payments and getting harassed by debt collectors.  If you want the phone calls and direct mail to stop, talk to Elias Dsouza and Dsouza and Strachan Lawgroup Group today.

Remembering Burt Reynolds’…Bankruptcy

Everyone is familiar with Burt Reynolds as an actor.  He starred in movies such as Smokey and the Bandit, Deliverance, Boogie Nights, and The Longest Yard.  What you may not remember is his bankruptcy.  Like so many Hollywood stars, he worked hard and played hard.

Divorce from Loni Anderson

In the early 90’s, after 5 years of marriage Reynold and Anderson filed for divorce.  The original divorce agreement mandated that Reynolds pay $2 million and an additional $47,000 per month in “divorce related expenses”.  He continued to pay various amounts for 22 years until he finally wrote a check to Anderson for over $154,000 to end the arrangement.

Bad Investments

Reynolds admittedly was not very good with money.  He took the advice of his business manager and did not pay attention to his investments.  The first bad investment was in a regional restaurant chain called Po’ Folks.  He and Buddy Killen invested $20 million each and they had problems from the beginning.  It got bad enough to warrant the liquidation of all assets which led Buddy and Burt to make another bad investment with the salvaged funds.

Investment number 2 was in another restaurant chain called Daisey’s Diner.  The same issues caused Buddy to sink an additional $12 million into the investment.  Both Buddy and Burt eventually pulled out.  All-in-all, Reynolds lost around $20 million in these investments.

The Icing on the Cake

Perhaps the biggest mistake Reynolds made was entering into all investments as an individual.  His business manager did not advise him to form a corporation with Buddy Killen which made Reynolds personally exposed to his creditors.  His personal assets became available to creditors when loans were not paid.  Even more questionable, Reynolds told his business manager to just pay everyone he owed instead of working with creditors to settle on lower amounts and payment plans.  This left Reynolds with almost nothing.

If Burt Reynolds had Elias Dsouza at his side, many of these unfortunate events could have been avoided.  Elias has been working with individuals to protect themselves in business transactions, debt defense, and credit restoration for over 15 years.  Contact Dsouza and Strachan Lawgroup Group for a free consultation.

Tips for Preparing Your Business for Tropical Storm Gordon

  • Posted On September 6, 2018
  • Categorized In News
  • Written By

Tropical storm Gordon made landfall in Florida Tuesday night.  You should have started preparing before today, but it may not be too late to ready your business for a turbulent week.  Mitigating damage during a natural disaster can be incredibly beneficial in the long run.

Preparing Your Property

This may seem obvious, but there are things you should do to your physical business to prepare for a tropical storm such as securing your property and covering windows.  You want to make sure that any products that are reliant on temperature are relocated in the event of power outage.   However, your business is composed of more than a building and physical goods.

Preparing Your Staff

Bad things happen when there is no plan in place for your employees.  People get caught at work during natural disasters quite frequently.  If you have employees, be sure to:

  • Prepare them with means of communication outside of landlines.
  • Create a “call down” list so everyone from the top down stays informed.
  • Let staff know that they are not expected to be at work if they are concerned for their safety.
  • Have a rendezvous point and time in place in case all communications are disrupted.
  • If you can, offer water, food, and shelter to your employees.

Preparing Business Operations

It is essential to prepare your suppliers, customers, and anyone else that could be affected by pausing your normal business operations.  A few things you can do:

  • Maintain a physical list of vendors and delivery schedules so you can maintain contact with them in the event of an outage.
  • Create a message on your website to communicate a plan to your customers.
  • Make sure you have enough cash on hand to operate for at least two weeks.
  • Keep a physical phone book with phone numbers for your insurance agent, local disaster relief organizations, and employee health insurance providers.
  • If you store business data on-site, consider transferring the data to a cloud service or another physical location.

It is very difficult to be completely prepared for a natural disaster.  Often times, small businesses lose money because insurance companies refuse to adequately cover damage.  If your business suffers damage caused by unforeseen circumstances and you need help getting the support you are entitled to, consider contacting Elias Dsouza at Dsouza and Strachan Lawgroup Group for a free consultation.

How Did Jay Z Make $810 Million?

Just about everyone knows Jay Z is one of the most popular hip-hop artists of all time.  Since 1996, he has sold over 55 million records.  However, did you know that only about 3% of his net worth is from album sales?  You may not be familiar with Jay Z’s music, but there is a good chance you have heard of companies he is involved with.

Roc-A-Fella Records

Jay Z and a couple of friends started this record label in the mid 1990’s.  Their first release was Jay Z’s album, “Reasonable Doubt”.  The record label had some success as they released Kanye West’s first 6 albums.


Rocawear

Jay Z followed up the record company with an urban clothing line called Rocawear.  It may not be a household name now, but in the early 2000’s, the company saw annual sales of over $700 million.  He later sold the company for over $200 million.


Roc Nation

This entertainment label was created by Jay Z and Jay Brown.  It has been a huge success and has signed people like Rhianna, T.I., and Big Sean.  This label has since been absorbed by Live Nation and gave Jay Z the ability to launch Roc Nation Sports.


Roc Nation Sports

This venture was born out of Jay Z’s time as a co-owner of the Brooklyn Nets.  He gave up his “shares” in the team so he could start the management company.  Today, Roc Nation Sports manages athletes such as Dez Bryant, Robinson Cano, and Kevin Durant.


Tidal

In an attempt to get into the music streaming game, Jay Z bought a Norwegian company and rebranded it to get exclusive rights to new hip hop albums.  They ended up with between 1.2 and 3 million subscribers (this has been debated).  He bought Tidal for $56 million and sold it for $200 million.

Buying and selling businesses is a complicated proposition.  It is important that you seek the advice of experienced and skilled people to take you through the process.  Elias Dsouza has been guiding business owners through complicated transactions for over 15 years.  Contact Dsouza and Strachan Lawgroup Group for a free consultation today.

 

Donald Trump: The Master of Chapter 11 Bankruptcy

Many businesses file for chapter 11 bankruptcy, Donald Trump’s businesses seem to have this step built into their plan.  With 6 chapter 11 bankruptcies under his built, Trump has shown a willingness to throw ideas at the wall to see what sticks.  Let’s take a look at those ideas that did NOT stick.

First, the Basics of Chapter 11 Bankruptcy

Unlike chapter 7, after filing for chapter 11 bankruptcy, a trustee is not automatically appointed by the court.  A trustee may be appointed if there is sufficient evidence that the debtor has committed less than savory acts such as fraud and gross incompetence.  Chapter 11 bankruptcy is often referred to as “reorganization” of debt.  If the creditor and debtor can agree to a plan, the business can continue to operate and pay back debt in the future.  Reports show that Chapter 11 bankruptcy filed by businesses is successful 10% – 15% of the time.

Bankruptcy #1 – Trump Taj Mahal

The Trumps paid $1.2 billion to build the hotel and resort.  The plan was to use Trump products to outfit the place.  Unfortunately, no one wanted Trump water, towels, etc. In 1991, chapter 11 bankruptcy was filled in an attempt to maintain control.  Trump was able to hang on to the property until 2015 when Carl Icahn took controlling interest eventually selling to the Seminole Indians for $50 million (4 cents on the dollar).

Bankruptcy #2 – Trump Castel Hotel and Casino

This property had trouble paying the bills after Trump opened the Trump Taj Mahal.  Maybe it is not wise to compete with yourself…In 1992, Trump bondholders signed a deal to accept equity and preferred stock in lieu of the debt.

Bankruptcy #3 – Trump Plaza Hotel

1992 was a rough year for Donald Trump.  The Trump Plaza Hotel went bankrupt which led to the transfer of 49% in equity to Citi Bank.  Trump was an estimated $550 million in the red at the time of the filing.

Bankruptcy #4 – Trump Plaza Casino

This property filed along with the Trump Plaza Hotel.  Over $100 million in liabilities have been reported for this filing.

Bankruptcy #5 – Trump Hotels and Casino Resorts

Perhaps this is one of the largest screw ups by Trump.  Trump Hotels and Casino resorts acts as the parent company to three of the afore mentions properties.  In 2004, this holding company filed for chapter 11 bankruptcy with over…wait for it…$1.8 billion (with a ‘b’) in debt.  Trump was stripped of control and his title of CEO only to emerge with a new company called Trump Entertainment Resorts.

Bankruptcy #6 Trump Entertainment Resorts

Trump Entertainment Resorts (TER) is the same group that ran Trump Hotels and Casinos into the ground for all intents and purposes.  To be fair, in 2009, tons of businesses were having trouble paying the bills due to the recession and TER already had debt from previous failed ventures.  When TER filed for chapter 11 bankruptcy, they were $1.2 billion in debt.

If you or your business is upside down in your loans and you are considering filing for bankruptcy under chapter 11, you need help.  This is an enormously complex process and you need someone to protect you from creditors and guide you.  Contact Elias Dsouza for a free consultation today!

The 3 Largest Bankruptcies in U.S. History

Many people were affected by the recession.  People lost their house, car, life savings, and more which led to bankruptcy.  However, bankruptcy was not limited to individuals and families.  Some of largest bankruptcies in history were actually filed by companies.

 

3 – WorldCom

Fueled by a hungry CEO, Bernie Ebbers, WorldCom managed acquisition after acquisition in the 1990’s.  The worlds # 2 long distance phone company and # 1 internet network had to keep its stock price up to pay for many of these acquisitions.  In one of the largest corporate frauds in history, this company took “cooking the books” to a whole new level.  To elevate the value of the company, they recorded over $9 billion in fraudulent transactions.

Before declaring bankruptcy under chapter 11, WorldCom had assets worth $103.9 billion.

2 – Washington Mutual

Everyone knows the housing market in California is well…challenging.  No one knows that better than Washington Mutual.  When housing values dropped more than 9 percent (equal to the drop during the great depression) in 2007, Washington Mutual found itself holding mortgages (mostly in California) worth far more than the asset they financed.  They couldn’t sell the mortgages to other companies which led to a net loss of $67 billion in 2007.  The final dagger for Washington Mutual was the loss of customer deposits.  When Lehman Brothers went down, people everywhere started pulling all of their money out of investments and banks.

Prior to declaring bankruptcy, Washington Mutual had $329.7 billion in assets.

1 – Lehman Brothers

You may be familiar with the term “subprime mortgage”.  These are mortgages that were given to unqualified people without the necessary documentation.  If this sounds like a bad idea, that is because it is.  Just ask Lehman Brothers.  This firm acquired 5 companies that were underwriting subprime mortgages during the housing boom in 2004 and 2005.  By 2006, they controlled $146 billion in mortgages which is wonderful when everyone is paying on-time.  Unfortunately, as we all know, that became a difficult proposition around 2008.

With a portfolio massively leveraged in mortgage loans and the stock market beginning to faulter, Lehman Brothers looked abroad for investors.  They were close to a deal with Korea Development bank.  When that deal fell through, stock holder confidence fell to an all-time low which marked the end.

Lehman Brothers filed for bankruptcy with $639 billion in assets and $619 billion in debt.

The Moral of the Story

No matter how much money you have, things can happen that leave you upside down in debt.  Regardless of fault, you can protect yourself.  If you are defaulting on loans and getting phone calls from debt collectors, you need help.  Elias Dsouza of Dsouza and Strachan Lawgroup Group has the skills and experience to give you that help.  Contact Elias to get started on the right path today.