Bankruptcies Reached Record Heights in 2002

Last year was a record breaker for bankruptcy filings. There were a total of 1,577,651 bankruptcies in 2002, an increase of 5.7 percent over the previous year, according to data released by the Administrative Office of the U.S. Courts. The last three months of 2002 showed a slight improvement, with filings declining 1.5 percent from the third quarter.

Personal bankruptcies rose 6 percent from 2001 to 2002 and accounted for the overwhelming majority of the filings, nearly 98 percent. High levels of consumer debt contributed to the rise in bankruptcies, according to the American Bankruptcy Institute (ABI), a nonpartisan organization that analyzes bankruptcy issues. Federal Reserve data shows that consumer debt reached an all-time high of $1.7 trillion in 2002.

While personal bankruptcies rose, the number of business bankruptcies declined by 4 percent from 2001 to 2002. Even so, last year saw some of the largest corporate bankruptcies in history. Leading the way was Clinton, Miss.-based WorldCom, which had pre-bankruptcy assets of $103 billion. Other high-profile corporate bankruptcies in 2002 include Conseco, Global Crossing, UAL, Adelphia Communications, Kmart, and NTL, according to New Generation Research, Inc.

You may like these other stories...

For the first time since 2006, more than 50 percent of CFOs believe the US economy will show signs of improvement over a six-month span rather than remain the same or worsen, according to a new study from Chicago-based...
By Jason Bramwell, Staff Writer CPAs in New Jersey, New York, and Pennsylvania believe economic conditions in the United States will likely be the same one year from now, and while they predict higher business revenues...
By Jason Bramwell Managers in accounting, finance, and IT are cautiously optimistic about their hiring plans for the fourth quarter of 2013, according to a new hiring outlook survey from staffing firm Brilliant. ...

Already a member? log in here.

Upcoming CPE Webinars

Nov 5Join CPA thought leader and peer reviewer Rob Cameron and learn ways to improve the outcome of your peer reviews while maximizing the value of your engagement workflow.
Nov 18In this session Excel expert David Ringstrom, CPA tackles what to do when bad things happen to good spreadsheets.
Nov 19How do you minimize redundant work and unnecessary steps to maximize the amount of work moving through your firm?
Nov 20Kristen Rampe will share how to uncover new opportunities with your clients by asking powerful questions.