The Boy Scouts of America has filed for bankruptcy protection following multiple abuse lawsuits.
The BSA says the move will allow it to build a compensation fund for abuse victims.
As a result of the move, all civil lawsuits against it are put on hold.
The BSA is struggling with declining membership as well as abuse claims.
Chief executive Roger Mosby said in a statement: “The BSA cares deeply about all victims of abuse and sincerely apologizes to anyone who was harmed during their time in scouting. We are outraged that there have been times when individuals took advantage of our programs to harm innocent children.”
Court papers filed in Delaware listed liabilities of up to $1 billion and assets of as much as $10 billion, reports say.
The filing was made under Chapter 11 of the US bankruptcy code which allows the group to keep operating and pay its creditors over time.
The bankruptcy allows the BSA to bring all of the lawsuits into one court and try to negotiate a settlement, rather than using its funds to fight each case in court.
The group said it was setting up a trust fund to compensate victims.
Roger Mosby said in a statement: “While we know nothing can undo the tragic abuse that victims suffered, we believe the Chapter 11 process – with the proposed trust structure – will provide equitable compensation to all victims while maintaining the BSA’s important mission.”
According to the Wall Street Journal, the BSA has 261 councils which operate local troops and own assets including land in many states. The bankruptcy move is designed to protect those councils, which hold about 70% of all BSA assets, the publication says.
In its statement, the BSA said the councils, which are legally separate and financially independent of the national organization, had not filed for bankruptcy.
The civil rights lawsuit against the company alleges that Harvey Weinstein harassed and abused women employed by the studio for years, as well as making verbal threats to kill staff members.
It accuses senior executives at the company, including Harvey Weinstein’s brother Robert, of failing to prevent the mistreatment of staff despite being presented with evidence.
New York Attorney General Eric Schneiderman is seeking an unspecified sum to cover damages, plus penalties, for victims of alleged abuse.
A lawyer for Harvey Weinstein has said a “fair investigation” will show that many of the allegations are without merit, while the company’s board of directors has said many of the allegations relating to the board are “inaccurate”.
The allegations against Harvey Weinstein first surfaced in October 2017, when the New York Times published a story detailing decades of allegations of harassment against the mogul.
Since then, more than 50 women, among them some of the biggest names in Hollywood, have accused Harvey Weinstein of assault, harassment, abuse and rape.
In the wake of the allegations, Harvey Weinstein was sacked by the board of his company.
He has admitted that his behavior has “caused a lot of pain” but has described many of the allegations against him as “patently false”.
Harvey Weinstein is under investigation by UK and US police, but no criminal charges have been brought.
In a statement, Boris Becker said he was “surprised and disappointed” that Arbuthnot Latham had chosen to bring the proceedings against him.
Image source Wikipedia
“This order relates to one disputed loan which I was due to repay in full in one month’s time,” he said.
“It is disappointing that my request for today’s hearing to be postponed until this time was refused. My earnings are well publicized and it is clear that I have the means to repay this debt.
“The value of the asset in question far exceeds the debt owed to Arbuthnot Latham.”
Boris Becker’s lawyers had asked for another 28-day adjournment after saying that they expected the Majorca property deal to be completed in a month’s time.
However, the registrar rejected the plea and said: “It is not often the case that a professional person has a judgment (debt) outstanding against them since October 2015. This is a historic debt.
“One has the impression of a man with his head in the sand.”
Boris Becker’s advocate, John Briggs, said: “He is not a sophisticated individual when it comes to finances. I am asking for a real last chance for Mr. Becker to come good. It has just taken longer than anticipated.”
Since retiring from tennis, Boris Becker has worked in business and the media and he also coached former world No 1 Novak Djokovic for three years from 2013.
Most of the people are having a hard time whether to declare bankruptcy or not. One of the reasons that they consider is it will put them or their business in a bad light. However, will you still be able to think of that reason if it’s your only option? If you need a legal action, these are the two common types of bankruptcy codes that will totally help you. Chapter 7
This is the most popular type of bankruptcy. The experts usually sell the property of the debtor to pay her credits. However, since they cannot sell that property that is exempt the law, most of the debtors can still keep the majority of their properties so no need to worry about losing your favorite car, if you have one. When it comes to the time frame, this code usually takes three up to four months only. The only people who are eligible for this system are those business owners who have low incomes or those who pass the mean assessment. However, those business-owners who have high incomes are not eligible for this code. You can file for a Chapter 7 bankruptcy code even if you don’t have a lawyer. However, if you want a satisfactory result, make sure that you own a little property or no property at all, your income is not higher than the median state and you have not made money or property payments to your preferred creditors. Also keep in mind that even if you didn’t get a lawyer, you are still obliged to pay the $335 Chapter 7 bankruptcy filing fee plus the $50 personal finance management class. The final decision whether to get a lawyer or not will always be yours. Chapter 13
If you want to pay your creditors through a repayment plan the Chapter 13 Bankruptcy code is the best one for you. The repayment plan is the agreement between you and your creditor that pinpoint how the debts will be paid back. The timeframe for this usually takes three to five years, depending on your income. Filing this type of bankruptcy can also be done without a lawyer. However, would you take the time to research all law and represent yourself to the court? Getting an attorney will be easier for you and for your case to be approved. Unlike the Chapter 7 code, another good thing about filing chapter 13 code is you can still keep all your property so no need to worry about selling your boat, farm house or expensive electronics if you have one. Takeaway Declaring a bankruptcy doesn’t mean that you have lost the battle in the corporate world. There are some times that things don’t go with how you wanted them to be, but it doesn’t mean that you, or your business, is unavailing. If you feel like you already need help to save your business or yourself still, then filing for the proper bankruptcy code is always an option.
No one imagines that they will ever have to file for bankruptcy in their lives. Everyone’s dream is to get a good job or start a successful business that will cater for his or her expenses and savings for life. However, things may turn around, and one finds themselves in a situation where they are unable to cover their expenses. This could be as a result of proper planning, loss of job, long-term illness, divorce among many others. In the midst of financial crisis, one of the decisions that one can make is to file for bankruptcy. Many people are not well informed on what filling bankruptcy means. Below are common myths that confuse most people.
You become debt free
Many people believe that when you file bankruptcy, you are free from debt. However, this is not the case. When you file for Chapter 13 bankruptcy, you get a new repayment plan that can last for around five years or less. For chapter 17, some of the debts are eliminated with the exception of student loans, alimony, child support, and tax. Not all the debts that are acquired within 90 days of filing for bankruptcy are eliminated especially if the court determines that you made purchases with no intention of paying back.
Bankruptcy ruins your credit completely
After bankruptcy, you can still get credit. Many people can apply for new credit cards and even mortgages after filling. One can start with a secured credit card and move on to a regular one later. However, note that most of the mortgages and car loans that you can get after filling usually come with high fees and interest rates.
You will lose all your belongings
There is a common belief that one will lose everything they own when they file for bankruptcy. This is not the case as the law allows some exceptions. What is exempted will depend on the state you are in. Before you file talks to a bankruptcy lawyer in your state to determine what you can retain.
You can’t file if you have a job
Even those with jobs can file for bankruptcy. You can, however, be disqualified if your salary is too high.
It’s better to pay off debts than file
Filing bankruptcy is a severe financial decision, but not a bad one especially if your debts are more than 50% of your annual income. If you don’t think it’s possible to clear them off within the next few years, then it better to just file than pay.
There are times when you come up with a brilliant idea that will surely be revolutionary. Everything’s all set. The only problem is money. How do you raise the necessary funds so your idea can take off and become a reality? What if banks and lending agencies do not approve your loan? Where will you go so you can get the funds that you need? In this post, we will explore crowdfunding and how this can help you in making your vision come to life.
Social media is an important factor when it comes to crowdfunding. You may be wondering how this is possible at all. Aren’t social media network only for posting photos and getting in touch with friends? Not anymore. It has become more powerful than that. It has changed the way we do business, how we market, and how we raise capital.
Social media is not limited to Facebook, Instagram, and Pinterest. There are many social media platforms that are crowdfunding websites. But what are these crowdfunding websites? These websites are what connects hopeful entrepreneurs to generous investors. Not only that, you get to connect with contributors, patrons, and producers, too.
Crowdfunding has the same idea as that of crowdsourcing. With these two, a person gets to have an open call towards a crowd or a large group of people. With crowdsourcing, tasks can be outsourced to this crowd. With crowdfunding, funds can come from these group of people through an open call. Through this online community, projects, causes, and businesses can be funded.
How It Works
The rules are different from one site to the next. In general, people, charities, or businesses get to pitch their ideas and set a goal for their fundraising, as well as deadline. After that, the potential patrons review the ideas and pitches so they can decide and choose which among the pitches they would want to support.
In crowdfunding sites, people do not invest in the business or project, what they do is that they fund it. If the business becomes prosperous, they get to be rewarded. However, it remains as a business that the entrepreneur owns. Patrons do not get to own any part of the project or business. This is because of the US regulations that are for now being reviewed by the SEC. But this may have some changes in the future.
For each of these crowdfunding sites, there are different rules, most especially the sites that are located outside of the US. That is why it is important that you take the time to read the terms and conditions.
How to Start Your Campaign
Your crowdfunding campaign begins with a pitch. With your pitch, you get to describe what your project is about. For example, if your project’s aim is to help veterans with their VA mortgage rates for their homes, you have to be very specific and very detailed about how you are going to help them and who among the veterans you will help. Also, with your pitch, you can describe in detail the rewards that the patrons may receive if the fundraising turns out to be successful. You can then create a timeline and a funding goal.
Choosing Your CrowdFunding Site
It makes a difference which site you choose to launch your campaign. For each crowdfunding site, they have a specific audience. There are those for creative people, there are some for the entrepreneurial crowd, and there are those that are socially bent. Non-profit organizations can also take advantage of crowdfunding sites. You have to know and understand the focus of your project so that you will also know on which site you are going to launch your crowdfunding campaign.
Knowing Your Target Audience
Once you are already clear about your project and you have chosen your site, focus now on the audience. Most of the projects that have been successful focused on a narrow and specific audience. You can focus on the audience based on religious nature, geographic area, or common background. You can also consider common interests such as books, movies, and music. When you know how to target your audience, your chances of being successful in your crowdfunding campaign will be much higher.
The internet is a fast-paced world. Your campaign can get left behind if you do not actively attend to it throughout the whole duration of the campaign. Have emails ready for the beginning, the middle, as well as the end of the project to make sure that it remains active. If the project immediately takes off, you may be overwhelmed with so many emails that you have to respond to. So to do this, prepare a FAQ-type of email so you have something to send those who are inquiring about your project.
You have to believe in your project and how it can help the people you want to reach. If you want to send school supplies to third-world schools, show the crowd why they need your help and how much their help can affect the lives of the school children. You have to be passionate about your cause and be the number one believer that you can make it happen. Passion is contagious. If people can see how devoted you are with your project and how sincere you are, they can be more convinced that it is worth their while to contribute funds to your projects.
These tips are just among the things that you can do to ensure a successful crowdfunding campaign. You have to be very passionate about what you do and convince the crowd that indeed, your project is worth funding. You have to be able to share your vision with the crowd so they can see that your project is worthwhile.
Donald Trump is making a splash in politics this year. The loud-mouthed reality TV star and casino mogul has rocketed to frontrunner status in the Republican primary race. Touting his business experience, Trump believes he can “make America great again”.
A cursory examination of his record proves somewhat troublesome, however. Particularly interesting is Trump’s propensity to file his businesses for bankruptcy. How can Trump call himself a successful businessman with so many bankruptcies under his belt? The answer, as you might expect, lies with “The Donald” himself. As it turns out, Donald Trump has a very different perception of bankruptcy than the general public does.
“I have used the laws of this country,” Trump told the audience at a debate, “the [bankruptcy] chapter laws, to do a great job for my company, for myself, for my employees, for my family.”
In short, Trump has used bankruptcy laws strictly to restructure his businesses, many of which he was keeping afloat with his own personal stash of cash. When you’re a business mogul like Trump, the people working under you are bound to make some poor decisions, but if anything—Trump’s dedication to doing whatever it takes to keep his projects above the water is actually somewhat admirable. Still, you can’t help but feel Mr. Trump’s success might have more to do with having a good bankruptcy attorney than business sense.
Let’s take a look at Trump’s four biggest bankruptcy blunders, and how he handled those situations.
Trump Taj Mahal, 1991
The Trump Taj Mahal is a sprawling casino and resort located in Atlantic City. When it hit hard times financially, Trump invested a lot of his own money to save it. To come up with the needed funds, he sold off his 282-foot party yacht. He also ditched his private jet, the so-called “Trump Shuttle”, which carried him between Washington D.C., New York, and Boston.
In the end, Trump gave up half of his ownership stake in the Casino. His efforts paid off, however, as the Trump Taj Mahal still stands. Funnily enough, Trump’s largest creditor at the time of the bankruptcy was Carl Icahn, who Trump says he’ll pick for secretary of Treasury if he wins the presidency.
Trump Castle Associates, 1992
Unfortunately, about a year after winning the fight for the Trump Taj Mahal, his other Atlantic City properties experienced some severe financial difficulties. The Trump Plaza Hotel in New York city was also struggling. In all, the Trump Castle Casino Resort, the Trump Plaza Hotel and Casino, and the Trump Plaza Hotel in New York (Trump sure likes to put his name on things) filed for bankruptcy.
The restructuring meant Trump had to give up half his interest in the New York Plaza Hotel to his debtor, Citibank. He was able to retain majority ownership of the casinos, however.
Photo Source: counterpunch.org
Trump Hotel & Casino Resorts, 2004
Trump managed to stay out of bankruptcy court for over ten years, but decided it was time to shed some debit in 2004. Over the course of the proceedings, Trump’s enterprises threw off some $500 million in debt. Trump once again gave up majority ownership of some of his properties but remained in control of his casinos.
Trump Entertainment Resorts, 2009
Now here’s something “The Donald” may not have been completely straightforward about during the Republican debate. He claimed he left Atlantic City due to foreseeing a future financial crisis, but he may have been forced out after his businesses again suffered financial hardship and had to file Chapter 11.
“I had the good sense, and I’ve gotten a lot of credit in the financial pages, seven years ago I left Atlantic City before it totally cratered,” he told the debate audience.
In 2009, however, Trump simply resigned from the board of his Atlantic City casino properties. Though many of them still bear his name, he gave up his remaining stake in the companies.
Now it seems Trump doesn’t want to be involved with Atlantic City at all. When two of the casinos that still bore his name again filed for bankruptcy in 2014, Trump sued them to have his name removed.
Surf clothing and snowboard outwear company Quiksilver has filed for bankruptcy in the US after it lost 79% of its market value this year.
Founded in Australia in 1969 but now based in California, Quiksilver operates in 100 countries.
The company said in a statement however that its operations outside the US are not part of the Chapter 11 filing.
Quiksilver listed in the US in 1986 but earlier this year its share price fell so low, it was threatened with delisting.
The deal is still subject to court approval.
Quiksilver CEO Pierre Agnes said in a statement that the company had taken the “difficult but necessary step to secure a bright future for [the company]”.
“With the protections afforded by the Bankruptcy Code and the financing provided by Oaktree, we will not only be able to satisfy our ongoing obligations to customers, vendors and employees, but we will also have the flexibility needed to complete the turnaround of our US operations and re-establish Quiksilver as the leader in the action sports industry,” he said.
The company’s brands include Roxy clothing and DC shoes and boots.
Quiksilver’ss board shorts pioneered the surf board fashion trend in 1970 and were regarded as somewhat revolutionary at the time. They were the first to include a Velcro fastening and were made with hardwearing quick-drying cotton.
Even before Kids Company went under, people were suspicious the group wasn’t spending money wisely. The UK charity group did indeed have questionable accounting practices, and wasn’t very transparent about where donations and public grants were going. Nobody, however, expected the extent of the charity’s wastefulness to be as dramatic as one former employee claims it was. Notably, she says founder Camila Batmanghelidjh personally wasted money by paying for five personal assistants and a lavishly decorated office.
“Her office was like an Aladdin’s den, with a tree in the middle, it was bizarre,” a former intern told The Telegraph. “I was so pro-Kids Company, but even on day one I just couldn’t believe the waste. The ethos is great and when she first started I think she was very well-intentioned, but having the attention of celebrities around her, her ego seems just to have got bigger and bigger.”
Photo Source: www.tampabay.com
Batmanghelidjh founded Kids Company in 1996, and she’s been highly critical of the government and media for not doing more to save the charity from bankruptcy. Critics say the charity was overemploying people, and some reports estimate £800,000 of a £3,000,000 grant went to paying employee salaries.
“I feel that the charity may have become caught up in the attention of the media and powerful politicians,” says the ex-intern, “as well as becoming overzealous when hiring staff. I felt that it was extremely overstaffed and that the money from salaries could be better spent elsewhere.”
The woman also claims Kids Company coerced children into filling out satisfaction questionnaires to make the company look better, thereby doctoring their own statistics. She thinks the good the charity is actually doing for children remains unknown.
Batmanghelidjh is increasingly coming under fire for her management style and alleged lack of dedication to the cause. “It seemed to me that people really are scared of her. She seemed to have favorites and if you weren’t one that was made clear.”
Phil Frampton, of the White Flowers Campaign Group, said the child care community has grown to resent Batmanghelidjh and her organization. “I think the Government and Batmanghelidjh have behaved despicably in letting the children down,” he said, adding: “They should have ensured that the kids and service users were guaranteed a transition.”
Batmanghelidjh herself has responded to the allegations of waste and resource mishandling, as well as defending her need for five assistants.
“I have very severe learning difficulties so I can’t use a computer and so I have to dictate everything,” she said. “Consequently because I am working from around eight in the morning to about 11 or 12 at night, the PAs have to rotate. When I fundraise I write each letter personally – or I sign it personally, so everything I have to dictate. The reason I have several PAs is that, first, they share the morning and evening slots and, second, one of them has to be a clinical PA because I work therapeutically with children. Because fundraising is so difficult I also have to do a bit of work on a Saturday and a Sunday so the PAs share the Saturday and the Sunday slot as well.”
She adds: “I think all this stuff about waste is unjust – we are actually quite under-resourced. What you’ve got to bear in mind is that we were processing from this office 10,0000 volunteers a year who come in to do all sorts of activities with Kids Company, we have partnerships with 270 companies, from whom we receive volunteers. Then we’ve got another team who are responsible for 500 students from nursing and therapeutic courses coming in to do their work experience, they get processed from the head office.”
She also defended her office decorations, stating:
“The reason the office is quite childlike is that it is not meant as an administrative office only – I also see children for therapy in it and therefore it has got play equipment. It has got a little duck pond so that kids can do their ‘family setting’ stuff there – if they can’t talk directly about something they can use the toys. It has got a lot of trinkets for the kids and the teenagers to use. It is there in that fashion for good reason.”
SCOTTeVEST is pursuing an acquisition of SkyMall, just days after the in-flight catalog filed for bankruptcy protection.
Scott Jordan, the founder of SCOTTeVEST, an Idaho company that makes tech-friendly clothing, has put in a bid for SkyMall.
He has not revealed the bid’s value since he is under a nondisclosure agreement with the company handling the sale of SkyMall.
Scott Jordan’s decision to put in a bid comes just after SkyMall announced it was bankrupt.
SkyMall has worked with SCOTTeVEST in the past.
The SkyMall brand is so big that other bids are to be expected.
Scott Jordan already has plans for the company, saying he will “bring SkyMall into the digital age”. Part of the reason why SkyMall has gone bankrupt is because devices such as laptops have removed the need for in-flight magazines.
SkyMall sells merchandise from a variety of sources, including its own curated selection of items. It also has allowed advertisers like SCOTTeVEST to place paid ads in the catalog. But in all cases, customers are encouraged to make purchases directly through the magazine (by phone or Web site) rather than directly through the manufacturer.
Russia will appeal a Hague court decision ordering it to pay $50 billion in damages Yukos Oil Co. case, the biggest compensation package ordered to date.
Russia was told to pay the money to former shareholders in the now defunct oil producer Yukos.
The Hague court said Russian officials had manipulated the legal system to bankrupt Yukos, and jail its boss.
The Russian finance ministry said the ruling was “flawed”, “one-sided” and “politically biased.”
The ministry added that the Hague’s arbitration court “had no jurisdiction to consider the questions it was given”.
The claim was filed by a subsidiary for the financial holding company GML, once the biggest shareholder in Yukos Oil Co.
GML Executive Director Tim Osborne said: “The majority shareholders of Yukos Oil were left without compensation for the loss of their investment when Russia illegally expropriated Yukos.”
“It is a major step forward for the majority shareholders, who have been battling for over 10 years for this decision.”
However, in a statement, the Russian ministry said: “Because of substantial shortcomings in the rulings of the arbitration court, the Russian Federation will challenge the rulings of the arbitration court in Dutch courts and expects to obtain a fair result there.”
Mikhail Khodorkovsky built Yukos into Russia’s largest investor-owned oil company after the fall of the Soviet Union
GML’s lawyer Emmanuel Gaillard said: “This is an historic award. It is now judicially established that the Russian Federation’s actions were not a legitimate exercise in tax collection but, rather, were aimed at destroying Yukos and illegally expropriating its assets for the benefit of State instrumentalities Rosneft and Gazprom.”
Dr. Florian Otto from risk advisory company Maplecroft said that Russia will be hoping to win time and reduce publicity.
He said: “For Russia, paying the money is out of the question, as this could be construed as an acknowledgement that the seizing of Yukos’ assets was illegal – a viewpoint the Kremlin will never accept.
“The ruling does not come as a surprise to any of the parties involved, but the coincidental timing with the downing of flight MH17 certainly adds to the pressure Russia is currently exposed to.
“The case serves as a fresh reminder of state interference in business at a time when business confidence is already at a low point.”
Lawyers said that if Russia does not voluntarily accept the ruling, it can be forcibly enforced by shareholders seizing assets abroad.
Konstantin Lukoyanov of global law firm Linklaters said: “If it is accepted, it can be carried out voluntarily, or it will be implemented forcibly.
“In that case the seizure of assets abroad is possible. There have been several similar cases.”
Leonid Nevzlin, former deputy chairman of Yukos told a Moscow radio station: “I think shareholders are ready for the next stage, if Russia refuses to pay them, to search for and seize Russian assets all around the world.”
Yukos was disbanded in 2007 after filing for bankruptcy in 2006.
The company was formerly controlled by Mikhail Khodorkovsky, who was at one point Russia’s richest man.
Responding to the news, Mikhail Khordorkovsky said it was “fantastic” that shareholders were “being given chance to recover assets”.
Mikhail Khodorkovsky built Yukos into Russia’s largest investor-owned oil company after the fall of the Soviet Union.
He was arrested in 2003 and spent ten years in jail after being convicted of fraud and tax evasion but was pardoned last December.
The state-owned Rosneft bought the bulk of Yukos assets though auctions after the company, once the country’s largest oil producer, was declared bankrupt. Rosneft says all the deals were legal.
Former world’s biggest Bitcoin exchange Mt. Gox has been put in administration by a Japanese court.
Mt. Gox announced in February that hackers had stolen hundreds of thousands of Bitcoins from it, worth about $500 million.
It later said that it had found a substantial number of the Bitcoins and had hoped to find a way to continue as a business and pay back customers.
But the court dismissed this plan and appointed an administrator.
In a statement on Mt. Gox’s website the administrator said that bankruptcy proceedings were likely to follow.
Mt. Gox has been put in administration by a Japanese court
This would involve Mt. Gox customers being asked to make any claims through the court, although the administrator pointed out that there was no time frame for this process at the moment.
Customers can continue to check the balance of any Bitcoins they have with Mt. Gox but are warned that this is not necessarily the amount they would receive as the result of a claim.
Mt. Gox said at the time it went offline that the Bitcoins had been stolen from its system by hackers who exploited a loophole in the software that oversaw the Bitcoin system. The administrator said that it plans to investigate the missing Bitcoins as part of its role.
The founder of Mt. Gox, Mark Karpeles, refused a request by a US court to attend a hearing this week to answer questions about the collapse of the exchange. He has not been charged with any crime.
Bitcoin is currently trading for around $500, down from a high of more than $1,100 last year.
Bitcoin exchange Mt. Gox has given up plans to rebuild under bankruptcy protection and has asked a Tokyo court to allow it to be liquidated, the Wall Street Journal reported, citing people familiar with the situation.
The source cited the complexity of the procedure and the lack of realistic rehabilitation plans for the Tokyo-based exchange as reasons for the move, the newspaper said.
Bitcoin exchange Mt. Gox has given up plans to rebuild under bankruptcy protection and has asked a Tokyo court to allow it to be liquidated (photo Getty Images)
Mt. Gox, once the world’s biggest Bitcoin exchange, filed for bankruptcy protection in Japan last month, saying it may have lost some 850,000 Bitcoins – worth around $454 million at today’s rates – due to hacking into its computer system. It has since said it found 200,000 of those Bitcoins.
Mt. Gox’s lawyers declined to comment on the matter.
Mt. Gox CEO Mark Karpeles won’t travel to the US to answer questions about the Bitcoin exchange’s US bankruptcy case, the company’s lawyers told a federal judge this week.
MtGox Bitcoin exchange has won a temporary bankruptcy protection in the US.
A judge in Dallas, Texas, agreed to protect MtGox’s assets and temporarily halt two US lawsuits while bankruptcy proceedings occur in Japan.
MtGox filed for bankruptcy in Japan in February after losing about $473 million worth of customers’ Bitcoins to what it says was a hacking attack.
The company is scheduled to return to court on April 1 to extend the protections.
MtGox filed for Chapter 15 protection in the US late on Sunday.
The filing asks the US bankruptcy court to recognize MtGox’s bankruptcy in Japan and protect its US assets.
MtGox Bitcoin exchange has won a temporary bankruptcy protection in the US
And it gives MtGox a temporary reprieve against two US lawsuits: one a class-action suit in Chicago filed by an Illinois resident, and another a $75 million breach-of-contract case filed in Seattle by Coinlab Inc.
At the time of the MtGox theft, about 750,000 customer Bitcoins were stolen as well as close to 100,000 of MtGox’s own bitcoins.
That amounts to about 7% of all the Bitcoins in existence.
Steven Woodrow, the lawyer leading the Chicago class-action suit, told Judge Harlin Hale that the case was a “massive fraud”.
MtGox’s attorney, David Parham, denied there was any fraud and said the company and its founder, Mark Karpeles, were complying with the terms of the Japanese bankruptcy proceeding.
MtGox Bitcoin exchange has reportedly filed for bankruptcy protection in Japan.
The application was made in Japan by lawyers acting on behalf of the exchange and comes only days after MtGox went offline.
On Tuesday, the exchange’s boss said he was working hard to find a “solution to our recent issues”.
Before going offline, technical troubles meant it prevented customers transferring digital cash to other exchanges on February 7.
MtGox Bitcoin exchange has filed for bankruptcy protection in Japan
Details of the bankruptcy are scant but the application for protection has been accepted by a district court in Tokyo, reported AFP. At the court hearing, the company said it had outstanding debts of about 6.5 billion yen.
MtGox’s lawyers are believed to have decided to apply to the court for protection after US regulators filed a subpoena against the company.
Reports suggested the site shut down after it discovered that an estimated 744,000 Bitcoins – about $350 million – had been stolen due to a loophole in its security.
MtGox’s troubles have put pressure on the price Bitcoin owners can get for their holdings. Currently one Bitcoin is worth about $561, a price far lower than the high of $1,000 per coin it hit in November 2013.
Meanwhile, Vietnam has banned its banks from handling Bitcoin saying the virtual cash is not legal tender. Vietnam’s state bank said trading in Bitcoins carried “potential risks” for users.
At the same time, Japan’s deputy finance minister said any regulation of Bitcoin would have to involve international cooperation to avoid opening up loopholes that traders could exploit.
Detroit’s state-appointed emergency manager Kevyn Orr has filed a plan to restructure the city’s debts in the wake of the largest municipal bankruptcy in US history.
The plan, awaiting approval from a bankruptcy judge, includes cuts to pensions and creditors to drive down the $18 billion debt.
Funds would also be devoted to demolishing abandoned city properties.
Detroit initially filed for bankruptcy protection in July 2013.
“We must move swiftly to emerge from bankruptcy so that the financial distress harming the city can end,” state-appointed manager Kevyn Orr said in a statement.
“We maintain that the plan provides the best path forward for all parties to resolve their respective issues and for Detroit to become once again a city in which people want to invest, live and work,” he added.
Detroit’s state-appointed emergency manager has filed a plan to restructure the city’s debts
Specifics of the debt relief plan include:
Creditors, including bond insurers, will receive an estimated 20% of their claims
Police and firefighter retirees will receive at least 90% of their pensions, and cost of living allowances will be eliminated
The Detroit Institute of Arts will keep its city-owned art collection, with assistance from foundations and private donors
$1.5 billion will be allocated over 10 years to city infrastructure and technology upgrades
The plan is reportedly likely to face obstacles moving forward, including court appeals should it be approved in bankruptcy court.
An estimated $12 billion of Detroit’s $18 billion debt is said to be unsecured, with no taxes or other revenue streams to pay it down.
Ongoing negotiations with stakeholders are also reportedly expected to result in changes to the plan, Kevyn Orr told US media.
The city has seen a dramatic decline in economic activity and population, as the big carmakers – once the city’s main source of employment – shifted production to cheaper locations in the US and overseas.
Detroit is now home to about 700,000 residents, down from the peak of 1.8 million in 1950.
A key meeting of Eurogroup (eurozone finance ministers) to finalize a crucial bailout for Cyprus has been delayed as talks to hammer out an agreement overran.
Cypriot President Nicos Anastasiades is locked in bailout talks with EU, European Central Bank and IMF leaders in Brussels.
The finance ministers must decide on Sunday whether or not to approve the bailout.
Cyprus needs to raise 5.8 billion euros to qualify for a 10 billion euro EU bailout and avoid bankruptcy.
A eurozone official said the Eurogroup meeting had been rescheduled for about 20:00 local time from 18:00 because talks with Cypriot officials ahead of those discussions had overrun.
In another development on Sunday, Bank of Cyprus – the island’s biggest lender – further limited cash machine withdrawals to 120 euros a day.
With queues growing outside cash machines across the island, the second biggest lender, Laiki (Popular) Bank, also lowered its daily limit to 100 euros, Cyprus News Agency reported. The bank’s previous limit had been 260 euros per day.
Banks have been closed since Monday and many businesses are only taking payment in cash.
Cypriot President Nicos Anastasiades is locked in bailout talks with EU, European Central Bank and IMF leaders in Brussels
In the run-up to the crunch talks in Brussels, the EU’s commissioner for economic affairs Olli Rehn said Cyprus had only “hard choices left” and must agree terms on Sunday.
According to a source close to the negotiations, the rescue plans – as they stand – involve splitting Laiki Bank into “good” and “bad” banks.
Good assets would be merged with Bank of Cyprus and the toxic assets will stay in Laiki. Administrators will then be appointed to liquidate those assets. The bank will not be closed but will be hugely reduced in size.
The source said a 20% levy would be imposed on deposits over 100,000 euros in Bank of Cyprus in exchange for shares in the bank.
A 4% levy would then be imposed on deposits of more than 100,000 euros in other banks. This would need to be approved by parliament but enough MPs have already given their backing to ensure it would pass.
The changes would cut Cyprus’s banking sector by between a third and a half.
Cyprus’ parliament rejected a bank levy on small and large deposits earlier this week, but a levy limited to large deposits is said to be back in consideration following pressure from Brussels and Berlin.
The levy that was rejected would have taken 6.75% from small savers and 9.9% from larger investors. It caused widespread anger among ordinary savers in Cyprus.
Cyprus needs the approval of the “troika” – the IMF, ECB and European Commission – in order to present a rescue plan to eurozone ministers.
If a deal on an alternative agreement fails, the ECB says it will cut off funds to the banks, meaning they would collapse, possibly pushing the country out of the eurozone.
“The negotiations are at a very delicate stage,” said Cypriot government spokesman Christos Stylianides.
“The situation is very difficult and the time limits are very tight.”
Olli Rehn said: “It is essential that an agreement is reached by the Eurogroup on Sunday evening. This agreement then needs to be swiftly implemented by Cyprus and its eurozone partners.”
“Unfortunately the events of recent days have led to a situation where there are no longer any optimal solutions available,” he added.
He said it was clear that the near future for Cyprus would be “very difficult” but that the EU stood ready to help.
There is concern on the island that a levy on large-scale foreign investors, many of whom are Russian, would damage its financial sector.
But leading Cypriot bankers have urged parliament to accept a levy, with small savers exempted.
Correspondents say Germany has pushed hard for a levy on investors who have benefited from high interest rates in recent years, rejecting a Cypriot plan to use money from pension funds.
Cypriot Finance Minister Michael Sarris recently travelled to Moscow in an unsuccessful attempt to get Russian help.
Banks in Cyprus have been closed since Monday and many businesses are only taking payment in cash.
On Saturday afternoon more than 1,000 bank employees marched to the Cypriot finance ministry, stopping briefly at the presidential palace.