A Look at Canseco’s Bankruptcy Documents
Saturday, August 04, 2012
So, GoLocalWorcester reached out to one of the city's top bankruptcy attorneys to shed a little light on just how bad the slugger's situation really is. James A. Wingfield Esq. leads the Law Offices of James Wingfield, and spends his days working with individuals, families and small businesses struggling with debt.
Canseco filed Chapter 7 Bankruptcy in Las Vegas earlier this week, and Wingfield explains that while you might think this will lead to the majority of his belongings being sold, that is not the case.
"Chapter 7 is liquidation, and it is available to both individuals and businesses," Wingfield said. "When you file for bankruptcy, a Trustee is appointed, and a bankruptcy estate is created. The Trustee will then attempt to find assets that can be liquidated, and the money coming from that will go into the bankruptcy estate to pay off creditors."
"However, in this case he has claimed exemptions for the majority of his assets," Wingfield continued. "He is claiming this to be a no-asset case, which means that there will likely be nothing to distribute. In fact, about 97% of individuals who file for Chapter 7 will have their cases deemed to be no-asset cases."
The details of Canseco's bankruptcy are quite interesting. The former major league star claims just $20,850 in total assets, but owes an astonishing $1,685,969 to different creditors. Of that money owed, nearly $450,000 of it is in debt to the Internal Revenue Service (IRS), $285,000 on a 2005 lien.
Canseco also owes a $785,344 judgment to Christian Presley, a man Canseco and his twin brother allegedly beat up in Miami Beach in 2001. With debts owed to the IRS and from a settlement, along with $150,000 owed to the California Tax Board and $116,000 owed to Citibank, it would seem Canseco could use a break.
"The moment you file for bankruptcy, you get what we call an 'automatic stay,'" Wingfield said. "What that is, is basically a temporary restraining order against your creditors. If someone is calling you and trying to collect money, that stops. If someone is suing you, that stops."
So, Canseco will get a break, albeit a temporary one. When looking at Canseco's assets, which are mostly comprised of his 2006 Chrysler 300 and clothes, Wingfield says that Jose's decision to file Chapter 7 was a relatively easy one.
"It doesn't look like he has a lot of assets, if this is an honest assessment," Wingfield said. "Did he have a choice (to declare bankruptcy)? That's a judgment call. But, was he going to be able to pay all this back (without filing)? Probably not. Just looking at the numbers, I would say it's a no-brainer."
Thursday and Friday, Canseco shot off a barrage of tweets that implied he was looking for work as a DH.
"Dh for hire. Final hurrah. Final season. Go out my way having fun playing. No bs," Canseco tweeted Thursday.
"Nice weather small ballparks wind blowing out fair umpires. Just want to retire on a high note and go into the sunset after season. Anyone?" Canseco tweeted Friday about the possibility of playing independent league ball in Texas.
However he is making money, and however quickly he is able to liquidate his softball equipment and golf clubs, Wingfield says there is still hope for Jose.
"What he has is the potential to earn a living," Wingfield said. "I see a lot of people that are in trouble (financially) but this does give you a chance to earn a living."
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