The world has witnessed numerous bankrupt billionaires who were once the wealthiest people and then lost it all. Knowing about those ex-billionaires teaches us a lot of lessons. Why did they lose it all? There are numerous factors that played a huge part in making them declare bankruptcy. These factors include economic downturns, lousy investments, and so on. However, the majority of them lost it all because of their lavish lifestyles and the habits of spending extravagantly. These bankrupt billionaires never thought twice before spending huge sums of money on trivial things.
In this article, we will talk about bankrupt billionaires who had it all and then lost it all. Let’s begin right away.
10 bankrupt billionaires who lost it all
1. Bjorgolfur Guamundsson
Bjorgolfur Guamundsson was an Icelandic billionaire whose net worth was $1.1 billion in 2008. Gudmundsson accumulated his wealth by having a majority of stocks of Landsbanki. Landsbanki is an Icelandic bank that collapsed during the banking collapse of 2008. As a result of the bank’s collapse, Guamundsson suffered irrecoverable losses. In fact, he lost all his fortune and filed for bankruptcy in 2009. Reports indicate that he was in debt of $750 million at that time. You must also know that Guamundsson’s bankruptcy was the largest personal bankruptcy in the history of Iceland. These facts and figures make him one of the most popular bankrupt billionaires.
2. Allen Stanford
Allen Stanford is among the bankrupt billionaires of the United States. He had a net worth of $2.2 billion in 2008. Stanford accumulated his fortune through real estate, insurance, and financing. He lost his fortune when he was convicted of fraud in 2008. Stanford was running the biggest Ponzi scheme of the century under the banner of his company Stanford Financial Group. FBI and the Securities Exchange Commission (SEC) imposed several violations of the regulations. It was revealed that Stanford was trapping investors through hypothetical records. He tried to flee the United States several times but failed. At last, Stanford himself surrendered to the FBI in 2009. Given the severity of his fraud, the Judicial Law of Florida punished him severely. He was sentenced to 110 years. He appealed in 2014 against the judgment but got rejected. Simply put, greed and immorality led Stanford to lose his entire fortune and become a bankrupt billionaire who lost it all.
3. Sean Quinn
Sean Quinn is another big name on the list of bankrupt billionaires who lost it all. He was once the richest person in Ireland. The total size of Quinn’s fortune was $6 billion in 2008. He accumulated wealth through real estate, construction, and insurance businesses. Quinn and his family also had a quarter stake in the Anglo-Irish Bank. How did he lose his entire fortune? Again, it is the big economic crisis of 2008 that also hit Quinn really hard. The Irish property bubble burst in 2008 and Quinn had to suffer huge losses. The nationalization of Anglo Irish Bank in 2009 was the final nail in the coffin. His 25% stake in the bank was wiped out. Besides losing his entire wealth, he was also in debt of $3 billion. His lavish lifestyle also played a huge part in his decline. Quinn eventually filed for bankruptcy in 2012 and the government declared him bankrupt later on. Thus, Quinn got himself registered among bankrupt billionaires who lost it all.
4. John D. Rockefeller
John D. Rockefeller was once one of the richest Americans with a total net worth of $360 billion in 2015. He was in the oil industry and the founder of Standard Oil Company. Rockefeller was a highly successful businessman who made huge profits. However, his losses were as severe as the Great Depression between 1929 and 1939. The recession is widely considered the worst economic recession in the history of mankind. Hundreds of businesses were affected by the recession but it affected Rockefeller most of all. He lost $709 million in 1929. The amount exceeds $10 billion if adjusted for inflation. Some sources consider him the richest American ever and one of the wealthiest people in history. ConocoPhillips, ExxonMobil, BP, and Chevron are among modern-day companies that were once part of Standard Oil Company. However, the great recession snatched everything from Rockefeller and he became a bankrupt billionaire who lost it all.
5. Eike Batista
Eike Batista was once the Brazilian wealthiest person and also made the 7th wealthiest person in the world. He was also in the oil industry and the total size of his net worth was $34.5 billion in 2012. His sources of wealth include mining, oil, and utilities. Batista often boasted about becoming the wealthiest person in the world. He was right up to some extent because his company had underlying assets of around $1.5 trillion in 2012. However, his downfall began when he over-aggressively bid on oil land that never produced oil. Investors also lost faith in his OGX oil company and eventually, his company owed debts 11 times the market value of the company. He lost everything he had. In fact, he lost even more than he had as he was in debt of $1 billion in 2014. Thus, Brazil’s richest person and the world’s 7th richest person entered the club of bankrupt billionaires who lost it all.
6. Vijay Mallya
Vijay Mallya was one of the highly successful Indian businessmen. He was a liquor and airline tycoon. Mallya is famous, or should I say notorious, for his luxurious, high-flying, and lavish lifestyle. He owned Kingfisher Airline which started to underperform and eventually under huge debts. Mallya and his company failed to pay back their debt. He fled from India to the UK using a diplomatic passport. Mallya is accused of fraud as well as money laundering. His net worth suffered a huge blow when £1.145 billion was recovered by the bank to compensate for the debt owed. Thus, his extravagant lifestyle and getting loans from banks to keep his company running caused his demise. Mallya is still residing in the UK. The loss of huge net worth books his place among bankrupt billionaires who lost it all.
7. Aubrey McClendon
Aubrey McClendon was an American business tycoon who was involved in multiple sectors. However, his major business was in the energy sector. McClendon co-founded American Energy Partners, LP, and Chesapeake Energy. He was also the chief executive officer of Chesapeake Energy and Forbes named him among the country’s top-performing CEOs in 2005. McClendon’s success wasn’t instant. He gradually became one of the wealthiest people in the US. However, the indictment by a federal grand jury in 2016 laid the foundation for his downfall. The jury indicted him for violating antitrust laws and allegedly rigging the bidding process for oil and natural gas leases. However, McClendon didn’t live long and died the next day in a fatal car accident. Thus, the man who took the energy sector by storm became the next one on the list of bankrupt billionaires who lost it all.
8. Elizabeth Holmes
Another bankrupt billionaire in the line is Elizabeth Holmes. She is an entrepreneur who quickly became popular for founding a remarkable start-up. Holmes and her company became quickly popular for developing a revolutionary blood test device. The device was claimed to transform the way patients were tested and treated in the past. Investors began to fund the company hoping to get huge profits in the future. Holmes’ company’s net worth at the time was $9 billion. However, Holmes and her company’s claims were just claims. It came to the surface after investigations that the company wasn’t even near to developing such a blood test device. Holmes was convicted of fraud and was forced to declare bankruptcy. Thus, Holmes is among the bankrupt billionaires who lost it all.
9. Patricia Kluge
Patricia Kluge is another one of the famous bankrupt billionaires who lost it all and had nothing left. She was a model but modeling wasn’t her major source of becoming a billionaire. Kluge met John W. Kluge during a trip to New York City. He was the richest man in the US back then with a net worth of $5 billion. John Kluge married Patricia Kluge. The couple divorced after 10 years and Patricia Kluge received a huge settlement amount – $1 million per year plus whooping Albemarle Estate. Kluge started a new business and enjoyed a brief spell of success. However, a series of wrong investments led her to downfall during the great recession of 2008. Kluge sold her all valuable assets including jewelry to avoid bankruptcy. However, it wasn’t enough and she had to file for bankruptcy in 2011.
10. Jocelyn Wildenstein
One of America’s big socialites and known as “Catwoman” is the last one on the list of the top bankrupt billionaires. She was once a billionaire who earned her fortune in a divorce settlement. She got $2.5 billion in the settlement along with two paintings. However, despite spending all her fortune, she believes that a faulty divorce settlement is the cause of her poor financial situation. The paintings she received were not as good as were originally believed. One of the paintings turned out to be a forgery of the original. Whereas, the second one sold for a fraction of the price she had hoped for. Thus, she lost her fortune and has nothing now. Wildenstein is reportedly in search of a top lower who would help her claim everything she was supposed to have for her lifetime.