9 Billionaires Who Lost All Their Fortunes and Went Bankrupt

Moon Walker

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Wikipedia

A billion dollars is such a ridiculous amount of money that our tiny brains can't really comprehend just how much money it is.

It's hard to imagine how people become billionaires, but even stranger is how some billionaires lose it all. Below are 9 billionaires who lost all of their entire fortunes.

Vijay Mallya

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indianTimes

Vijay Mallya has sometimes been called the Indian Richard Branson. He turned his family brewing business into a massive conglomerate, and he also made money in chemicals, fertilizer, and an airline company.

But he also played as hard as he worked. His birthday celebrations included performance from stars like Enrique Iglesias and Lionel Richie. He even bought a stake in a Formula One racing team. Meanwhile, his company was having problems paying its staff.

Mallya's airline owed employees back pay, plus more than $1 billion in loans. In 2015, the authorities raided his home and offices, so he fled India for Britain in 2016.

But he wasn't out of the reach of the law, as he managed to get arrested twice in 2017 for defaulting on his loans and money laundering.

By 2019, Mallya was still fighting extradition to India to face charges. He was relying on his children, business acquaintances, and even his personal assistant to get by, but his lawyers admitted that he was having trouble living frugally, as he was still spending $24,000 a week.

They did say he was graciously willing to cut that to a mere $37,500 a month. Meanwhile, his creditors want their $1.5 billion back.

Eike Batista

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Forbes Brasil

Brazilian entrepreneur Eike Batista once openly bragged that he was going to become the richest person in the world. This wasn't a completely crazy goal, since he was already the eighth-richest person and worth $35 billion.

But then things went very south, very quickly. This oil and mining tycoon was a cheerleader for his home country, particularly Rio de Janeiro.

He donated cars to the police, renovated a famous hotel, and helped clean up an important lake before the 2016 Summer Olympics.

But then Batista managed to lose his fortune in a single year.

First his oil company filed for bankruptcy in 2013, then the Brazilian economy tanked in 2014. But the final nail in the coffin came in January 2017 when he was caught up in a wide-ranging corruption scandal, with hundreds of businesspeople and Brazilian government officials charged.

In 2018, Batista was sentenced to 30 years in prison for paying $16.5 million in bribes. But a year later he was still just under house arrest, and it was a very loose house arrest, since he was walking the streets and talking to reporters.

But that didn't mean things were looking up for him. In 2019, he was fined $134 million for insider trading and banned from running a public company for seven years.

Elizabeth Holmes

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Biography.com

On paper, Elizabeth Holmes was unbelievably impressive. She started her first business in high school and at age nineteen dropped out of Stanford university to develop an idea that would revolutionize the blood testing industry.

Since she was afraid of needles, she thought there must be a way to do all diagnostic tests from just a finger-prick of blood. That idea became Theranos, a company eventually valued at $9 billion.

"We'd like to see a world in which every person gets access to this type of basic testing" she said.

That meant Holmes was the youngest self-made female billionaire at the time. She attracted investors like mogul Rupert Murdoch and board members like Henry Kissinger.

On paper, everything was great. Unfortunately, when things moved from paper to the real world, they all fell apart. Theranos was basically one big scam. None of the cutting-edge technology Holmes trumpeted actually worked.

Former employees reported a culture of secrecy and fear that let the con go on too long. Now there's an HBO documentary and a best-selling book covering how Holmes pulled it off. That kind of chicanery gets you in big trouble.

Holmes was booted from Theranos, which eventually closed completely. She was indicted on 11 counts of fraud and faces 20 years in prison. Her net worth plummeted to zero.

However, she reportedly married a hotel heir in secret, so maybe she'll land on her feet financially after all.

Bernie Madoff

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Wikipedia

Bernie Madoff was famous for running the largest Ponzi scheme of all time. But for a while, he was known as one of the most brilliant men on Wall Street.

After graduating from college in 1960, he founded his investment firm with $5,000 he saved from working as a lifeguard. It wasn't until the 1980s that his company turned into a Ponzi scheme.

People invested with Madoff because he promised them amazing returns on their money, which he then paid using money from newer investors. Then the newer investors were paid with the investments of even newer people.

Madoff stood out from other companies thanks to his exclusivity. You had to ask to invest with him, and he wouldn't necessarily say yes. This was catnip for the rich and powerful.

Being able to invest with Madoff became a mark of prestige for people like Steven Spielberg and Kevin Bacon. He managed to keep his scheme going an impressively long time and became a billionaire himself in the process.

But the 2008 financial crash was too much for his fake business to take. He admitted he'd lost his clients $50 billion and was arrested for securities fraud.

In 2009 he was sentenced to 150 years in prison and died in April 2021.

Allen Stanford

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The Telegraph

He worked so hard at being a crook, but no one knows who he is because he only ran the second-largest Ponzi scheme of all time. Since it was discovered just two months after Bernie Madoff's, Stanford didn't get nearly the notoriety he deserved.

The native Texan liked to live big. He was listed on the Forbes 400 in 2008, worth around $2.2 billion. Even though he made all this money totally illegally, he had no problem spending it.

In just three years, he put down $100 million just on aircraft, including helicopters and Lear Jets.

He spent $12 million to make his yacht 6 feet longer. He was even knighted by the Caribbean island of Antigua in 2006.

Stanford started his first offshore bank in 1985. Like Madoff, he promised absurd returns on investment.There were rumors about how he did it, and as early as 1997 the SEC knew something was up.

A financial expert who toured the bank in 2006 said that it was obviously a Ponzi scheme because the staff and infrastructure were completely inadequate.

Everything fell apart in February 2009, and Stanford is now broke and serving a 110-year prison sentence.

Bjorgolfur Gudmundsson

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IcelandMag.is

Icelandic businessman Bjorgolfur Gudmundsson has had an extremely interesting life. He went from furniture packer and law student to billionaire and philanthropist.

In the 1990s, he spent a year in prison for shady bookkeeping. When he got out, he went to Russia to rebuild his fortune, which meant defying the mafia in St. Petersburg.

He married his wife after she left her previous husband, George Lincoln Rockwell, the founder of the American Nazi Party, who was later assassinated. Then he became Iceland's second billionaire, after his own son, and had business interests in shipping, publishing, food, communications, and property.

He financially supported a symphony, rock stars, and students. A promising soccer player in his youth, he also bought West Ham United FC in 2006.

In March 2008, Gudmundsson was worth $1.1 billion. But by December, his net worth was zero.

When Iceland's second-largest bank collapsed during the financial crisis, it wiped him out completely. His company went into liquidation and he sold West Ham.

In August 2009, Gudmundsson filed for bankruptcy with the biggest personal bankruptcy claim in the world ever at that point.

He told the judge he faced, quote, "almost complete lack of income."

And the hits kept on coming. In 2015, he was charged in one of the largest fraud cases in French history.

Patricia Kluge

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The Washington Post

Patricia Kluge got her money the old-fashioned way. As in, she was a former belly dancer and model who became the third wife of billionaire John Kluge, who was 34 years her senior.

They got hitched in 1991 and for nine years lived an extravagant jet-set lifestyle. Their home base was a 23,500-square-foot, 45-room mansion in Virginia.

Their guests were expected to wear tweeds, were waited on at dinner by liveried footmen, and were driven around in horse-drawn carriages.

In 1990, the gossip rags were fed in a big way when the Kluges divorced. John Kluge was the richest man in the world and in order to be free of his wife he gave her a reported $1 billion, the biggest divorce settlement ever at that point.

But Patricia majorly overextended herself.

In 2010, she started auctioning off everything from jewelry to guns to designer clothing. But it wasn't enough. She had to sell her beloved winery, to Donald Trump of all people, who kindly gave her a job there after she sold it.

But ultimately she didn't raise enough money to starve off bankruptcy, and Trump even fired her from her vineyard job after just one year.

Sean Quinn

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Irish Mirror

In 2008, Forbes listed Irish businessman Sean Quinn as the 164th richest person in the world, with a net worth of $6 billion.

His meteoric rise is impressive. He left school at age fourteen and then borrowed 100 pounds to start a business selling gravel.

He built that into one of Ireland's most successful companies, getting involved with insurance, concrete, glassmaking, hotels, and a bank, with 8,000 employees total.

At one point he was the richest man in Ireland. In November 2011, Quinn declared bankruptcy in the United Kingdom, the biggest bankruptcy case in the country's history.

A couple months later he also declared bankruptcy in Ireland. He claimed that the bank calling his loans had a "vendetta" against him. But the Irish Banking Resolution Corporation said it was just trying to recover 2 billion euros the Quinn family owed them.

In November 2012, Quinn ended up in jail on three contempt of court charges. When he got out nine weeks later, he told the BBC that prison was "tough" and he didn't think he deserved it.

By 2019, Quinn's fight with the IBRC was still ongoing. Additionally, his children were trying to convince the court that their father totally screwed them over, and while they might have owned companies on paper, in reality he was in charge of everything.

"But there is this quite simple moral dilemma, which is comply or don’t comply, prison, freedom, Your father chose prison."

Jocelyn Wildenstein

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Business Insider

Jocelyn Wildenstein has been called the "Bride of Wildenstein" and "Catwoman" in the New York tabloids because of her very unique look.

She's had plastic surgery done, but she told Paper Magazine in 2018 that her bitter ex-husband exaggerated just how much she went under the knife.

As for her sharp eyes and cheekbones, she attributes those to her Swiss heritage. That bitter ex-husband did make her a billionaire,

though, even if their divorce was tumultuous.

For 20 years she was married to French art dealer Alec Wildenstein, but their relationship fell apart suddenly in 1999. Jocelyn got a reported $2.5 billion in the divorce.

It's hard to spend away that amount of dough, but Wildenstein somehow managed to do it. She was used to spending $1 million a month when she was married, and she kept up that pace after her divorce.

She bought $10 million in jewelry and spent $350,000 on a single Chanel dress. In a time before free talk and text, she ran up a $5,000 phone bill every month.

In 2018, Wildenstein was "surprised" when she had to file for bankruptcy. Her $6.38 million in debts included $300,000

to lawyers and $4.6 million on her apartment.

She listed her bank account balance as $0 and said she was surviving on $900 a month in Social Security, plus help from her family and friends.

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Jack is a freelance writer and editor who loves to inspire others with his words and also share interesting stories to the world.

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