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.
Reference:
http://www.bet.com/news/music/2013/10/23/dmx-bankruptcy-filing-hitting-snags.html