Remember the Time: Protecting Michael Jackson in His Final Days by Bill Whitfield

Author:Bill Whitfield [Whitfield, Bill]
Language: eng
Format: epub
ISBN: 9781602862517
Publisher: Weinstein Publishing
Published: 2014-06-03T00:00:00+00:00

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In the 1980s, as one of the wealthiest entertainers in the world, Michael Jackson spent money extravagantly—because he could. But even as he lavished enormous sums on building his own amusement park and other endeavors, Jackson was famous for watching every penny. He checked over invoices to make sure no one was taking advantage of him, and he fired anyone he felt he couldn’t trust. Somewhere along the way, that Michael Jackson ceased to exist. He stopped paying attention, started trusting the wrong people, and his fortune began to disappear.

After the Chandler scandal in 1993, Jackson’s income began to shrink, but his outsized expenses did not. In addition to the annual upkeep of Neverland, Jackson continued spending several million dollars a year on chartered planes, antiques, paintings, hotels, and other personal expenses. If extravagant spending had been his only vice, he likely could have afforded it. But the singer also continued to make significant investments in his own career.

To achieve his artistic vision in the short films for “Thriller” and “Bad,” Jackson had financed large portions of the projects himself—investments that had paid off in spades. In the 1990s, he continued the practice, sinking tens of millions of dollars into various film and video endeavors. Only now, with his record sales contracting, those investments no longer provided the same return. Various handlers and financial managers began inserting themselves more and more in the singer’s affairs, using his money in questionable deals that yielded more legal entanglements than profits. Though Jackson was still worth hundreds of millions of dollars on paper, he quickly found himself in a severe cash crisis.

In 1995, Jackson sold Sony a 50 percent stake in the ATV music catalog for $100 million. In 1998, his debts still growing, Jackson took out a loan from Bank of America for an additional $140 million, putting his stake in what was now the Sony/ATV catalog up as collateral. By 2000, Jackson’s line of credit with the bank had been upped to $200 million, and he was also deeply in debt to Sony, which had continued to advance him large sums against his future earnings—earnings that continued to decline.

By the time Jackson’s trial started, the payments to service his debt—never mind his living expenses or his legal fees—were costing him over $4 million a month. As the trial dragged on, Jackson missed several of his monthly installments to Bank of America, and the lender sold his loan to Fortress Investment Group, a hedge fund that specialized in distressed assets. By the end of 2005, Jackson was already delinquent on his newly refinanced debt, and Fortress threatened to call the loan, which worried executives at Sony. If the singer defaulted, his share in the Sony/ATV catalog—now worth close to $1 billion, by some estimates—would be put up for auction and sold to the highest bidder, saddling the record label with a potentially unwelcome partner. That crisis was averted, momentarily, the following April. Fortress agreed to restructure the debt in order to allow Jackson to stay afloat.

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