Court documents reveal that Michael Jackson was over $500 million in debt at the time of his death. The executors of his estate have filed a petition for unpaid fees dating back to 2018. As early as 1993, Michael was incurring massive debts and by mid 1998 to about $140 million which corresponds to the time he was busy preparing for his HIStory album. Following the period to 2009 during which he died, his mouth-watering debt another upped by $170 million. Besides, he incurred higher interest rates on his loans which variably ranged between 7% and 16%. 8% annually, which we gathered from the testimony of accountant William R. Ackerman.
His financial issues were also pretty serious: to cope with it, Jackson had used the rights to song catalog including Beatles hits as the security for the approximately 270 mln dollars owed to Bank of America. These loans were later sold to Fortress Investment Group in 2005 this company deals with distressed debt.
The use of his song catalog shows Jackson’s various efforts to reduce the amount of debt and it shows another innovative approach that the star made to ensure that he minimizes his problems in the financial department while facing a continuous build-up of the problem.
Former AEG CEO discusses Jackson's financial struggles and legacy
Former AEG Live Chief Executive Officer Randy Phillips on the other hand said that Michael Jackson was not interested in a lifestyle of excess but in presenting his work. Phillips described Jackson as a good marketer aspiring to restore his financial solvency. Instead of being frail and dominated by others, as it might be seen or portrayed, Phillips stressed the aspect of forcefulness and partial control on Jackson’s side. He said that Jackson was aware of the case and keen on enhancing his financial position, and even planning to halt his wandering life and seek income.
But, of course, there are also great expenses that are incurred in connection with the canceled tour, which after Jackson’s death became the responsibility of the latter’s heirs. According to the reports, Jackson was in deep debt to AEG, which was the concert promoter at that time amounting to around $40 million. Problems arose in managing income generation from the assets that belonged to the estate since most of Jackson’s assets were over-leveraged and struggling financially before his death. This financial burden brought out some of the factors and problems that Jackson’s estate faced after the artist’s premature death. To read more click here.