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Judge dismisses Rudy Giuliani's bankruptcy case, clearing way for collectors to pursue debts

By
Graham Kates
Reporter
Graham Kates is an investigative reporter covering criminal justice, privacy issues and information security for CBS News Digital. Contact Graham at KatesG@cbsnews.com or grahamkates@protonmail.com
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Graham Kates

/ CBS News

A federal judge dismissed Rudy Giuliani's bankruptcy protection case Friday, clearing the way for creditors to pursue foreclosures, repossessions and other efforts to collect debt from the former New York City mayor and Trump adviser.

Giuliani himself asked for the dismissal Wednesday, after more than half a year of missing court deadlines amid allegations by lawyers for his creditors that he was evading questions about his finances.

He filed for bankruptcy protection after a federal jury in December held him liable for defaming two Georgia election workers, and awarded them $148 million in damages. 

Giuliani spread lies tying the election workers, Ruby Freeman and Shaye Moss, to a wider conspiracy he pushed — and continues to champion — claiming without evidence that former President Donald Trump lost the 2020 election due to fraud. The dismissal will allow Giulani to pursue an appeal of the defamation case. U.S. Bankruptcy Judge Sean Lane previously barred Giuliani from doing so while his Chapter 11 reorganization was ongoing.

Lane criticized Giuliani for a lack of transparency about his finances during the proceedings, writing Friday that he "has not even retained an accountant, which is the most rudimentary of steps. Such a failure is a clear red flag."

"Giuliani has failed to provide an accurate and complete picture of his financial affairs in the six months that this case has been pending," Lane wrote.

Giuliani is barred from again pursuing bankruptcy protection for one year, Lane wrote.

A spokesperson for Giuliani criticized "voluminous and overly broad discovery requests" in the case, in a statement to CBS News.

"We will continue to pursue justice and we are confident that—in the long run—our system of justice will be restored and the mayor will be totally vindicated," said the spokesperson, Ted Goodman.

Giuliani's creditors accused him during the bankruptcy case of hiding assets and using the bankruptcy process to slow down collection. They pointed on Monday to a "completely incongruous" series of recent filings by Giuliani. 

He requested on June 17 an extension to file a reorganization plan, crucial to showing a judge the plan for repaying debts. Then Giuliani filed on July 1 a motion to liquidate his assets, giving control to an independent trustee. On Wednesday, he turned the case upside down when he announced he was seeking its dismissal.

Giuliani's financial problems have peaked as his legal troubles have piled up. He's entered not guilty pleas to charges in Georgia and Arizona stemming from his alleged efforts to undermine the 2020 presidential election results. 

Giuliani, a former U.S. Attorney for the Southern District of New York, was disbarred from practicing law in the state on July 2. A board in Washington, D.C., recommended in May that he be disbarred there as well.

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