Famous Bankrupts – Kerry Katona
In our monthly look at famous people who have been declared bankrupt, we are going to look at former Atomic Kitten singer, Kerry Katona. OK, so when we say “famous” we mean it in the very loosest of contexts. Sorry Kerry!
Kerry Katona was made bankrupt in 2008 due to outstanding debts arising from unpaid taxes, amounting to an original figure of over £400k.
When Katona was declared bankrupt she was reportedly earning £400,000 a year working as a columnist for OK! Magazine and approximately £80,000 a year as the face of Iceland. Katona’s fortune was estimated to be close to £7m before this stage.
Despite being made bankrupt in 2008, it would appear that Kerry Katona is still under a Bankruptcy ruling. Today’s Bankruptcy rules mean that an average person can be discharged from bankruptcy in 12 months or less. This rule was brought into force in 2004 in the hope that it would help people recover from the effects of their debts quicker.
According to The Insolvency Service in the UK, Kerry Katona’s bankruptcy order is still in affect and is currently in the hands of a private trustee. The Insolvency Service is not able to disclose why Katona’s bankruptcy order is still in place.
One thought is it may be that she has failed to comply with the terms of the bankruptcy ruling. This can include non-attendance, misinformation, obstruction, delay or serious misbehaviour. If Katona was guilty of any of these misbehavior’s, the trustee can, theoretically, apply to the court for the discharge period to be extended.
One of the reasons that Katona may have been forced to declare bankrupt is due to her extravagant lifestyle. She married Mark Croft, a taxi driver, in 2007 and was reported to have bought him a whole range of top of the line cars worth an estimated £1.5m. Croft publicly admitted that he had ‘bled her dry’ during their marriage.
Bankruptcy should be treated as a last resort if you have debt problems in the UK. Declaring yourself bankrupt can mean that you can lose belongings, your property, your car and much more. When you are bankrupt you should not try to get credit for more than £250 without disclosing the fact that you are a bankrupt. You are not allowed continue with a business in a different name without telling everyone involved the name that you were declared bankrupt under.
You should not manage or form a limited company or act as a company director without the court’s knowledge and permission. On top of all of this, a bankrupt person is not allowed to hold certain public offices.
After bankruptcy has been discharged in the UK, the person’s debts are wiped clean they can can work in any position once again including public office. However, a persons credit record will still be damaged as the insolvency order will remain on a persons credit file for a period of up to six years.
I have a repayment arrangements in place with various creditors for things such as credit cards and unsecured loans. One lender will not accept any proposal to repay the debt and want to take the matter to court. Can the court force me to pay the full amount of the debt or will they take my current income into consideration?
