Rudy Giuliani bankruptcy shows Trump ally drowning in debt

Rudy Giuliani’s bankruptcy filing, sparked by a multimillion-dollar judgment against him for defaming two Georgia election officials, provides new insight into the former New York mayor’s finances.

In December, a federal jury in Washington, D.C. awarded Giuliani a whopping $148 million to Ruby Freeman and Shay Moss for making baseless claims that they engaged in widespread voter fraud after the 2020 election. ordered to pay money. A few days later, he admitted that the fine had placed a severe strain on his finances and filed for bankruptcy.

Late Tuesday, his bankruptcy judge allowed Mr. Giuliani, a longtime ally of former President Trump, to appeal the defamation verdict, but in the meantime, Mr. Giuliani’s bankruptcy proceedings have significantly affected his finances. Cracked, his debts and overall status revealed.

The position includes thousands of dollars in tax and credit card debt, and if it turns out he has also defamed voting technology companies Dominion Voting Systems and Smartmatic. They could be owed millions more.

Here’s what we learned about Giuliani’s finances amid bankruptcy.

Profile of the creditor

In addition to Mr. Freeman and Mr. Moss, creditors with the largest unsecured claims against Mr. Giuliani include banks, lawyers, government tax authorities, golf clubs and other entities.

Mr. Giuliani owes more than $900,000 in taxes, most of which is federal.

Giuliani owes nearly $40,000 in unpaid dues between two golf clubs in West Palm Beach, Fla., including the former president’s Trump International Golf Club, much of which he disputes. is chanting.

It could also be owed millions of dollars in unresolved lawsuits, according to court filings.

New York resident Daniel Gil sued Giuliani for $2 million after he was charged with assault after he slapped the former mayor on the back and asked him, “What’s up, you son of a bitch?” Law firm Davidoff Hatcher & Citron is seeking $1.36 million in a complaint filed in September by Giuliani’s longtime lawyer, Robert Costello, citing unpaid legal fees. Aidala, Bertuna & Cummins, the law firm Giuliani hired after his apartment was raided by the FBI, is also seeking more than $387,000 in damages.

In addition, several lawsuits seek “unknown” claims, including Dominion, Smartmatic, the president’s son Hunter Biden, and Noel Dunphy, who accused Giuliani of sexual assault and harassment. .

But Giuliani’s bankruptcy case is still in its early stages.

The $148 million judgment suddenly forced Mr. Giuliani to file for Chapter 11, meaning his bankruptcy began without an organized group of creditors.

Mr. Moss, Mr. Dominion and Mr. Dunphy then worked together to represent the unsecured creditors in future proceedings.

Mr. Giuliani now has a deadline to propose a reorganization plan that outlines how he will compensate creditors and ultimately emerge from bankruptcy. Gary Fischoff, one of Mr. Giuliani’s bankruptcy lawyers, told The Hill that it is “too early to know” when a plan will be filed.

Giuliani: Trump campaign and RNC have a duty to sue

Giuliani claimed in a hearing earlier this month that he was short about $2 million in legal fees due to activities related to Trump’s 2020 presidential campaign.

Giuliani told creditors and the Justice Department’s bankruptcy watchdog during a Feb. 7 hearing that the money was owed to both his campaign and the Republican National Committee, not the former president himself. Ta. According to Bloomberg Law.

“I understood that once I took over, the legal work and expenses would be paid for by the campaign,” he said. According to the Independent. “When I submitted the invoice for payment, they just paid the expenses. Not all of them, but most of them. They never paid the legal costs.”

The court filing states that the potential charge is “undetermined” and is against “Donald J. Trump.”

The fees were the result of Giuliani “taking over” the Trump campaign’s legal staff at former President Trump’s request in November 2020, Giuliani told creditors and the U.S. trustee’s office. At the time, Trump campaign lawyers were beginning a legal effort to overturn the election results in battleground states in Trump’s favor.

The Trump campaign and RNC did not respond to requests for comment.

External organization that pays attorney fees

Mr. Giuliani appeared to be facing financial difficulties even before the bankruptcy, but the former New York mayor asked attorney Joseph Sibley to represent Mr. Giuliani in the Georgia election official defamation suit and a separate lawsuit. Questions were swirling about whether he had been paid.

The bankruptcy revealed new details about the arrangement, revealing that two outside groups financially supported much of Mr. Giuliani’s defense efforts.

Mr. Sibley said in a sworn statement Friday that Mr. Giuliani himself only disgorged $30,000.

The remaining $548,000 came from two other entities. Sibley received $260,000 last year from Giuliani Defense, a political action committee formed by the former mayor’s son, Andrew Giuliani, according to campaign finance records.

The group appears to receive much of its financial support through a $100,000-per-plate fundraiser that President Trump hosted for Giuliani at his Bedminster, New Jersey, golf club. On the same day, Giuliani Defense received large donations of more than $500,000, including one from Elizabeth Ailes, the widow of former Fox News chairman Roger Ailes, records show.

The Rudy Giuliani Freedom Fund sent about $288,000, Sibley said. That group is run by Jake Menges, a longtime aide to Giuliani. Accepting donations from the public online.

Menges did not identify the donors, but said in court papers that the number was “in the hundreds.” Most donations are less than $100, but the foundation has received some larger donations, including a $25,000 donation and a $10,000 donation, Menges said.

Mr. Giuliani told a bankruptcy judge on Monday that he had not contributed to the fund, but hours later amended his filing to show that he once allocated $10.

“Have his cake and eat it too.”

Details of Mr. Giuliani’s lawsuit were leaked as part of the former mayor’s fight to seek an immediate retrial in the defamation case and file a notice of appeal.

With the bankruptcy filing, Mr. Giuliani automatically froze the lawsuit and various other civil proceedings. However, his criminal case in Georgia, where he and Trump are facing extortion charges, will not be affected.

Mr. Freeman and Mr. Moss said that if Mr. Giuliani is able to continue his lawsuit despite his bankruptcy status, Sibley, the lawyer who represented him in the case, would ultimately become a creditor, and if not. He expressed concern that they may try to take money out of the pot that would otherwise be available.Go to mother-daughter duos etc.

“[I]It’s ironic that the first substantive relief Mr. Giuliani seeks in his Chapter 11 case — at least a speedy trial — is a motion to lift the automatic injunction so he can appeal in Freeman’s court. It’s the ultimate. This is a lawsuit,” an attorney for the election commission wrote in the objection.

“Through this motion, Mr. Giuliani wants to have his cake and eat it too. Rather than post bond, he will appeal the Freeman case and take advantage of the automatic stay to free Mr. Freeman and Moss. We want to prevent his sentence from being carried out.”

Mr. Giuliani’s bankruptcy judge approved his motion on Tuesday after both Mr. Giuliani and Mr. Sibley assured the court that their lawyers had no intention of raising money from pot. In exchange, Sibley said he agreed to pay a flat fee of $50,000 plus an out-of-pocket fee to process the appeal, which will be covered by two outside parties.