Sunday, October 6, 2013

Bad Celebrity Investments That We Remember

By Cornelius Nunev


Celebrities and their money are often parted. Here are a few of the most memorably bad celeb investments, ever.

Investing as Mark Twain

One poor investment was made by the first modern celebrity in America, Mark Twain. During the last 19th century, he got a Paige Compositor that was intended to be a typesetter faster than the standard Linotype. It ended up not working well because it had over 18,000 parts and needed to be cared for too much. Over 11 years, Twain spent $150,000 to $300,000 on the machine, which was a ton of money back in his day.

Hotels by Jay-Z

The big investment mistake made by Jay-Z would not completely end until December 2010 when out-of-court settlements and legal battles finally ended. He bought land to produce a luxury hotel in New York City. The hotel was going to be 150,000 square feet and would be for luxury guests in the Chelsea neighborhood. He started the project in 2007 right before the economic crash. He wound up defaulting on the $52 million loan and shut down the project because of lack of funds. Hotel partners had to give the lender the property back.

The Bono investment

The U2 front male is a managing director for the private media and entertainment equity firm Elevation Partners. After making a killing with investments in Yelp, Facebook and video game companies BioWare and Pandemic Studios, later investments in Palm ($460 million) and Forbes, Inc. ($300 million) turned into enormous losses. Ultimately, Elevation's return on those investments was only $25 million, which was enough to convince the website 24/7 Wall Street that Bono is "the worst investor in America."

Enormous Larry King investment

A life insurance scam that flipped policies was something King accidently got behind. He made $1.4 million regardless of the belief that he gave up two policies worth $15 million.

Everybody associated with Madoff

The Bernard Madoff $65 billion Ponzi scheme ended up stealing money from over 200 investors, many of which were celebrities. A number of people are attempting to make up for the financial loss now that Madoff is in jail serving 150 years for 11 federal felonies.

Another bad investment from a movie star

The most popular film star of the 1970s, Burt Reynolds wound up dealing with the urge many celebrities face: opening a restaurant chain. The chain was PoFolks, and outlets existed in California, Texas and Florida. By the late 1980s, however, the cupboard was bare and Reynolds was out $15 million. His eventual divorce from Loni Anderson and diminished star power led to a 1996 bankruptcy. Even though he was more than $10 million in debt, bankruptcy court allowed him to keep his $2.5 million mansion and all of his personal property that Anderson had not already claimed.

Reynolds investment

In 1997, Debbie Reynolds would deal with her first bankruptcy due to a Vegas casino she decided to start in 1991. When she started the casino, known as Debbie Reynolds Hotel & Casino, she did not realize it would never get business by being off the strip. She ended up handling the bankruptcy and selling the hotel off for $10 million in 1998 to the World Wrestling Federation. Last year, she would also end up selling all things from her film career as her memorabilia museum would also go bankrupt.




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