Earl Simmons, aka hip hop rapper DMX, filed for Chapter 11 bankruptcy protection back in July of this year. But it seems that actions related to his filing are now being questioned by federal authorities. Along with a new lawsuit against the rapper, his legal team has their hands full in trying to get the situation clarified. Now, officials feel DMX should satisfy creditors by selling his possessions by converting his Chapter 11 into a Chapter 7 bankruptcy case.
Due to several inconsistencies and delays in getting necessary paperwork submitted, such actions are now being challenged by a U.S. Trustee official (U.S. Justice Department). Simmons filed a Chapter 11 case this past summer to help restructure his debt obligations. The U.S. Trustee claims the case should be tried as Chapter 7 liquidation instead of Chapter 11 case.
This comes after the rapper reportedly missed a meeting of the creditors that was scheduled in September. Federal officials claim paperwork related to filing was inconsistent, messy and in complete disarray. For instance, his income information was listed differently on several documents. One document listed his monthly income at $5,000 while another listed it at just under $2,000.
When he filed in the summer, one of his largest debts was outstanding child support payments totaling over $1 million. He owed roughly $20,000 on an auto lease. A lawsuit against the rapper from a booking agency claims they gave DMX half a million dollars last year toward advances and child support payments.
Reps for the rapper claim he never received such funds, but any possible transactions that occurred in relation to the money may have been conducted by the agency and Simmons’s former manager. A judge is expected to review the case in December.
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