Judge ends Rudy Giuliani’s bankruptcy case, says he disrespected the process with his lack of transparency

NEW YORK — A judge expelled Rudy Giuliani bankruptcy filing on Friday, criticizing the former New York mayor as a “recalcitrant debtor” who turned up his nose at the process while trying to protect himself from a $148 million libel trial and other debts.

U.S. Bankruptcy Judge Sean Lane criticized Giuliani for repeated “uncooperative conduct,” self-dealing and a lack of transparency. The judge cited failure to comply with court orders, failure to disclose sources of income and his apparent reluctance to hire an accountant to review his books.

“Such a failure is a clear red flag,” Lane wrote.

Filing the case ends your quest for bankruptcy protection, but does not absolve you of your debts. Your creditors may now seek other legal remedies to recover at least some of the money owed to them, such as obtaining a court order to seize your apartments and other assets.

Giuliani is now free to also appeal the defamation verdict, which arose from his efforts to overturn Republican Donald Trump’s defeat in the 2020 presidential election.

Lane indicated at a hearing Wednesday that he would likely dismiss the case. Giuliani’s lawyer suggested other options to keep the case alive, but ultimately agreed that closing it was the best path forward. The dismissal includes a 12-month ban on Giuliani filing for bankruptcy protection again.

“Transparency in Mr. Giuliani’s finances has proven to be an elusive goal,” Lane wrote, and he “sees no evidence that this will change.”

Among his concerns, the judge said, was that Giuliani funneled his income — including at least $15,000 a month from his now-cancelled radio show — to companies he owned; he never reported any income from these entities; he did not disclose that he had started promoting his own brand “Rudy Coffee”; and was late announcing a contract he has to write a book.

Giuliani spokesman Ted Goodman — drawing a parallel to what he called the “grossly unfair” defamation case — said Friday that the bankruptcy issue was “burdened with many of the same voluminous and overly broad discovery requests and other actions.” Among them, he said, were leaks “designed to harm the mayor and destroy his business.”

Goodman attributed political motives to Giuliani’s legal troubles, saying without evidence that the goal was to punish him for investigating President Joe Biden’s son, Hunter, and “to dissuade anyone else from asking questions or finding out the truth.” However, he said, they are confident that “our justice system will be restored and the mayor will be fully vindicated.”

Giuliani, a longtime Trump ally, filed for bankruptcy last December, just days after the surprise damages award to former Georgia election officials Ruby Freeman and Wandrea “Shaye” Moss. The bankruptcy filing froze debt collection.

An attorney for Freeman and Moss accused Giuliani at Wednesday’s hearing of using the bankruptcy as a “bad faith litigation tactic” and a “pause button for their problems,” and urged Lane to dismiss it so they could proceed with the damages they received.

“Ruby Freeman and Shaye Moss have waited too long for justice,” the woman’s attorney, Rachel Strickland, said Friday. “We are pleased that the court has seen through Mr. Giuliani’s games and put an end to his abuse of the bankruptcy process. We will begin to apply our judgment against him as soon as possible.”

The other people and entities to whom Giuliani owes money wanted to keep the bankruptcy process going with a court-appointed trustee taking control of Giuliani’s assets.

Earlier this month, Giuliani requested that the case be converted to a Chapter 7 liquidation — in which an appointed trustee would sell assets to help pay creditors.

Giuliani’s attorney, Gary Fischoff, reconsidered that idea at Wednesday’s hearing and pushed for the case to be dismissed, noting that administrative fees related to the settlement “would consume, if not 100%, a substantial portion of the assets.”

Freeman and Moss can now take their efforts to receive sentencing back to the court in Washington, D.C., where they won their case. The women said the fact that Giuliani attacked them after Trump narrowly lost Georgia to Biden led to death threats that made them fear for their lives.

The bankruptcy is one of several legal problems affecting Giuliani, 80, a former federal prosecutor and 2008 Republican presidential candidate who was once hailed as “America’s Mayor” for his calm and steady leadership after 9/11. 2001, terrorist attacks.

Last week he was discharged as lawyer in New York after a court found he repeatedly made false statements about Trump’s defeat in the 2020 election. He also faces the possibility of losing his law license in Washington after a board in May recommended that he be expelled.

In Georgia It is ArizonaGiuliani faces criminal charges for his role in the effort to overturn the 2020 election. He has pleaded not guilty in both cases.

When he filed for bankruptcy, Giuliani listed nearly $153 million in existing or potential debts, including nearly $1 million in state and federal tax liabilities, money he owes lawyers and many millions of dollars in potential judgments in lawsuits against him. He estimated he had assets worth $1 million to $10 million.

In his most recent financial filings in the bankruptcy case, he said he had about $94,000 in cash on hand at the end of May, while his company, Giuliani Communications, had about $237,000 in the bank. Giuliani’s main source of income over the past two years has been a retirement account with a balance of just over $1 million in May, down from nearly $2.5 million in 2022 after his withdrawals, the documents say.

In May, he spent nearly $33,000, including nearly $28,000 on condo and co-op costs for his homes in Florida and New York. He also spent about $850 on food, $390 on cleaning services, $230 on medicine, $200 on laundry and $190 on vehicles.