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Rich Dad, Poor Dad Author Bankrupt?

by , November 9, 2012. (Posted in: Miscellaneous / Personal Finance News)


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Seems as though the finances of Robert Kiyosaki, the author of the bestselling Rich, Dad, Poor Dad series of financial advice books, is taking a bit of a different path in how he teaches others of how the rich life and how they’re so different than the rest of the little people.

Unfortunately, to do so, he’s had to file bankruptcy. It’s not because his business crashed or he’s been diagnosed with a money draining disease or illness, for Kiyosaki, it’s all about strategy.

One of the corporations Kiyosaki owns and has operated from, Rich Global LLC, found itself in bankruptcy proceedings over the summer. And despite what he calls “strategy”, in the end, that corporation was ordered to pay slightly less than $24 million to the Learning Annex and to its chairman Bill Zanker.

Remember, Kiyosaki once said,

Most people coming out of an MBA program have those skills to be an employee and climb the corporate ladder, but they don’t have those skills to be an entrepreneur and start a business. One of those skills is handling pressure. How long can you operate without money? Can you raise capital?

One wonders how he’d word that sentiment on this side of a bankruptcy filing.

Robert Kiyosaki is considered one of the financial gurus who started small – actually, he started with nothing – and then found his way to the big time by speaking at get rich seminars and insisting his followers could easily get rich – if they were willing to learn how.

He was able to bring in folks to these pricey seminars by promising the secrets of the wealthy; he was going to reveal all of the money making efforts and strategies of those who struck it big. Unfortunately, his efforts included advice that, if taken, would have made his followers lawbreakers.

At times, he encouraged insider trading and incorporating unfunded broker accounts. He also pushed buying real estate with no money down (subprime mortgage, anyone?)

What makes this even more unfortunate is that he filed bankruptcy that hurt one of his earliest and strongest believers. The Learning Annex, and specifically its chairman, Bill Zanker, was one of those folks who Kiyosaki could count on when he could count on no one else.

Zanker covered the bases in those early days and provided an audience that would thrust Kioysaki into the higher ranks. Oprah Winfrey, PBS and other big name media outfits also supported Kiyosaki by sharing their stages and air time, as well.

These days, it’s estimated Kioysaki is worth more than $80 million. He was also smart enough to keep his personal distance from the bankruptcy by filing under one of his corporation’s names.

Not only that but the New York Post was able to locate Mike Sullivan, who’s CEO of one of Kiyosake’s corporations.

He revealed that Kiyosake wouldn’t include any of his own money towards the settlement with Zanker and because they chose the corporation well, the one filing bankruptcy was worth practically nothing in the world of the “rich and famous”, which leaves Zanker holding the bag.

Last month, a new book co-penned by both Kioysaki and Donald Trump was released. “Midas Touch: Why Some Entrepreneurs Get Rich – and Why Most Don’t” was released to strong reviews.

This was the second book co-written by these two. The first book, “Why We Want You To Be Rich” made some predictions that eerily came full circle, including the 2008 economic collapse.

Not only that, but if you haven’t read it yet or recently, you should since you’ll recognize much of the content is very similar to the talking points for the 2012 Presidential election.

This time, the book offers five chapters – one chapter for each finger on a hand. The symbolism is used to explain how many dynamics go into a successful business.

What’s missing (and was never designed to include) was advice for small business owners and the unique needs, such as revolving credit and how to handle things like health care.

Dynamics such as strength of character, emotional maturity, and sacrifice are included, along with the traits that every good entrepreneur possesses. They continue to say that not every can be a successful entrepreneur and no one can be without the five key points.

They also make no mention of filing bankruptcy, even though Kioysaki was neck deep into it right before the book was published. Of course, we wonder, too, what Donald Trump might have to say about the timing.

So do you think filing bankruptcy is the act of a strong business leader? Should bankruptcy protection be allowed to protect the ultra rich from doing the right thing? Have you ever attended any of his seminars? Read his books? Let us know your thoughts on this, Kioysaki and even Donald Trump.

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