Columbus Blue Jackets defenseman Jack Johnson has filed for bankruptcy, according to the Columbus Dispatch.
Johnson, 27, is in his ninth NHL season. He is slated to earn $5 million this season. However, due to his parents' mismanagement, he won’t see a dime.
After splitting from his agent Pat Brisson in 2008, Johnson gave power of attorney to his parents. With his fortune in their control, his parents took out a series of high interest loans in his name after Johnson signed a seven-year $35 million contract with the Los Angeles Kings in 2011.
The first loan Johnson’s parents took out was for $1.56 million, used to purchase a home in Manhattan Beach, California. The loan included a 12 percent interest rate and a down payment of $1 million.
Just one day after signing the home loan, the Johnsons took out a $2 million personal loan from U.S. Congressman Rodney L. Blum, also with a 12 percent interest rate.
Hardly one month later, the Johnson took out a $3 million personal loan—this one at 24 percent interest. The loan was funded by Pro Player Funding.
Not even a month later, Johnson was sued by both Pro Player Funding and Congressman Blum; he reached a settlement with both parties that included garnishing his wages.
However, Johnson’s parents continued to take out more loans in his name—up to 18, according to the Columbus Dispatch. Additionally, both parents purchased new cars and made roughly $800,000 in home improvements to the Manhattan Beach home.
On October 7, Johnson filed for bankruptcy, listing assets "of 'less than $50,000' and debt of 'more than $10 millon,'" according to court papers; the Dispatch alleges his debt might be closer to $15 million. Due to the high level of debt, Johnson is filing Chapter 11 bankruptcy, which is usually reserved for businesses.
Johnson has cut off communication with his parents but no legal action has been taken at this time; he has sued mortgage lender Steve Miller, who was involved in the home loan, in an attempt to prevent a foreclosure.
“I’d say I picked the wrong people who led me down the wrong path,” Johnson told The Dispatch. “I’ve got people in place who are going to fix everything now. It’s something I should have done a long time ago.”
Johnson’s bankruptcy hearing is scheduled for January 23, 2015 in Los Angeles.
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