Q&A: How to hold companies under bankruptcy protection accountable?

Apr 7th, 2011
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Question by pshao01: How to hold companies under bankruptcy protection accountable?
What prevents a company from borrowing a ton of money, spending it all, declaring bankruptcy, and never paying back its creditors?

Details: say the CEO gets a huge “salary” (this is actually borrowed money), buys himself a bunch of toys, then declares bankruptcy and never repays the money. What is the punishment for said CEO?

Best answer:

Answer by bobbino11
Im assuming NOTHING.

Know better? Leave your own answer in the comments!

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  1. wizjp
    Apr 7th, 2011 at 15:11
    Quote | #1

    uh…the fact no responsible or intelligent entity would lend money to such an orginization in the first place?

  2. Hiya
    Apr 7th, 2011 at 15:42
    Quote | #2

    The airline industry managed to stay mostly afloat after declaring bankruptcy, the auto industry can do the same.

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