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Tyson's punch line? $38 million debt

WashPost: After losing $400 million, ex-champ gets back to work repaying creditors, ex-wives and other assorted debts.
Mike Tyson hopes to repay his $38 million debt with a couple of big pay-day bouts during the next year.Peter Jones / Reuters file
/ Source: a href="" linktype="External" resizable="true" status="true" scrollbars="true">The Washington Post</a

At the height of his popularity and fortune, Mike Tyson owned six mansions, two white Bengal tigers and 110 cars, including garages full of Bentleys, Mercedes and Rolls Royces.

But on Saturday night, the former heavyweight champion will enter the ring in Louisville for the first of what could be as many as seven bouts in an unprecedented fight for financial solvency. According to U.S. Bankruptcy Court records, Tyson is $38 million in debt after blowing an estimated $400 million fortune.

According to court records, Tyson was down to his last $1,250 in cash three months ago. Tyson, 38, said all of his houses have been sold or seized and he owns only one car — albeit a white Hummer SUV, newly purchased — and apparently not yet paid for.

Tyson's attorneys recently presented a bankruptcy reorganization plan in New York that calls for the former heavyweight champion to fight as many as seven times in the next three years to help pay off the debt. The first fight is against unheralded British heavyweight Danny Williams.

Tyson owes money to at least 246 creditors, including the Internal Revenue Service, the Screen Actors Guild and dozens of doctors, lawyers and accountants. Tyson owes his ex-wife, Monica Turner, almost $9 million from their divorce, and he hasn't paid $19.4 million in taxes to the IRS, Great Britain and five states.

"I guess life's lessons have been pretty priceless for me," Tyson said, during a recent interview at the Central Boxing Club in Phoenix.

Tyson's reorganization plan is ambitious — he hopes to earn at least $19.5 million from boxing over the next three years to help satisfy his creditors. Tyson will receive an additional $14 million from his lawsuit against former manager Don King, and $4.2 million from the sale of three of his homes, all of which goes to his creditors.

Under the plan, which hasn't yet been approved by a judge, Tyson will be allowed to keep at least $2 million from each of his fights. Although Tyson once commanded as much as $30 million to fight, the $2 million might seem like a king's ransom to him now. According to bank records, Tyson's attorneys submitted to the U.S. Bankruptcy Court, Tyson earned $38.38 during January. His living expenses during that month were more than $407,000.

If the reorganization plan is approved, Tyson will be scheduled to pay $2.475 million in August, followed by six more payments of at least $1.47 million. His largest payment of $4.95 million would be due in January 2006.

"They don't care about me," Tyson said of his creditors. "Nobody wants to hear excuses. They just want to see results — send us the check."

The bankruptcy documents reveal how Tyson squandered his fortune as fast as he earned it during his rapid climb from the streets of Brooklyn to the biggest draw in boxing history. He will seemingly spend the rest of his controversial career fighting to pay off his debts -- and it doesn't seem to bother him at all.

"I never even think about losing $400 million," Tyson said. "It's hard for you to understand because it's not your lifestyle. I think about everybody I looked up to, Joe Louis, Jack Dempsey, everybody had a great deal of money and lost it. I blew money and I'm going to get it again. How many times am I going to throw this left hook to get some more money?"

Freddie Roach, who has trained Tyson in Phoenix the past three months, said Tyson's troublesome finances hardly seem to affect the fighter.

"He doesn't seem like he misses the money," Roach said. "He hasn't shown that he misses it. He doesn't complain about the money. Not once. I'm sure I'd be happier with the money, but I think he realizes money isn't everything. I think hitting rock bottom woke Mike up."

The bankruptcy reorganization plan calls for Tyson to fight seven times over the next three years to pay off his debts, but Shelly Finkel, his manager and advisor, says it could require only two or three bouts.

"I haven't paid attention to the numbers," Finkel said. "I know he'll be out of debt a lot sooner than [three years]. His goal is to win the heavyweight championship again and defend it, and whatever it takes, that's what we'll do. To me, the debt will take care of itself. The important thing is he looks good in the ring."

After facing Williams (31-3) on Saturday, Tyson (50-4, 44 knockouts) could schedule another tuneup fight in the fall. His handlers believe he could be in line for a championship fight sometime next year, possibly against World Boxing Council champion Vitali Klitschko or light heavyweight champion Antonio Tarver. Tyson hopes the championship fight would bring a $20 million payday for him.

"People don't understand if I owe somebody $30 million or $40 million, I only have to fight two fights to pay them off," Tyson said. "I've been blessed. If I have a $40 million bill, I'm able to pay it off quickly."

But Tyson and his handlers are banking on the American public regaining interest in the former champion. The heavyweight division, long the most high-profile in the game, has been without a marquee name since Lennox Lewis announced his retirement in February. While recognized as a great champion, Lewis was hardly the lightning-rod for the sport Tyson has been.

Ever since his rise to the title — and the start of his memorable fall that night in Tokyo more than 14 years ago when he was upset by James "Buster" Douglas — the public has had a love-hate relationship with Tyson. His fistic power has been rivaled only by the amount of controversy that follows him, from his rape trial (and conviction that led to a three-year prison sentence), to his ear-biting incident against Evander Holyfield, to positive drug tests following bouts.

It's not just the power of his left hook that makes the public want to see what happens next with Tyson, who has fought 54 times since turning professional in 1985, but only once in the past two years.

In June of 2002, he lost his biggest fight since his disqualification against Holyfield when he was stopped by Lewis in the eighth round in Memphis. He knocked out a fighter nicknamed "The Black Rhino" — a Louisianan named Clifford Etienne — after only 49 seconds, but the public seemed to care less. Now his handlers believe the window of opportunity could be opening again.

"Mike could definitely get things rolling again in the heavyweight division," Roach said. "The guys that are out there now aren't knockout artists. People love knockouts. Nobody wants to see a 12-round decision. People love to see knockouts and that's what Mike does. That's why people will pay to watch him."

Tyson said his willingness to pay his debts and not ignore them proves that he's a better person than before. He seems happier without money and the enormous responsibilities that come with fortune.

"If I didn't pay my taxes and bills, it's not like they were going to send me to prison," Tyson said. "If they were going to send me to prison then I'd say, 'Oh, I better go fight.' But they weren't going to send me to prison. These people say, 'Oh, he's fighting to pay his bills.' If I was a schmuck like I was before, when I didn't fight for 18 months and didn't want to do anything, I would have said, 'Shove it up your butt. I'm not doing anything.' But I said I'm going to deal with this responsibilities."

Tyson said he has lived the past several months in a friend's modest, two-bedroom home near downtown Phoenix. Other homes in the neighborhood have recently sold for about $120,000, according to real estate records. Before moving to Phoenix for training camp, Tyson lived with friends in New York. Tyson no longer has an entourage of hanger-ons and friends, and his payroll has essentially been reduced to four — Finkel, Roach and cornermen Tom Paddy and Panama Lewis.

When his star was at his zenith, Tyson employed as many as 200 people, including bodyguards, chauffeurs, chefs and gardeners. During one of his bankruptcy depositions, Tyson told attorneys he couldn't remember what happened to a Rolls-Royce an employee purchased. He accuses former managers and employees of stealing millions of dollars from him, much of the money vanishing in the early 1990s while Tyson was imprisoned in Indiana.

"I never came from money," Tyson said. "I don't care about money and stuff like that. If I cared about money, I'd be in a loony bin by now and would have done something ridiculous."

Tyson certainly enjoyed the money while he had it. According to the bankruptcy documents, Tyson spent nearly $4.5 million on cars and motorcycles, $3.4 million on clothes and jewelry and $7.8 million on "personal expenses." He once bought an 18-carat gold dial, encrusted with 16 diamonds, for $245,000. He still owes a Las Vegas jeweler $173,706 for a gold chain lined with diamonds, and a rug store in New York $78,000 for home furnishings.

The documents reveal that Tyson spent $140,000 on his two white, Bengal tigers and $125,000 a year for their trainer. He spent $2 million on a bathtub for his first wife, actress Robin Givens, and $410,000 on a birthday party. Tyson spent $230,000 on cell phones and pagers during a three-year period from 1995 to 1997. He owes Ferrari of Beverly Hills more than $60,000 and more than $300,000 to a limousine company.

"There's no question that his spending habits took excessive spending to a new level and new heights," said attorney Sanford Ain of Ain & Bank in Washington, who represented Monica Turner in her divorce from Tyson. "Mike Tyson is in the position he's in because he allowed people to do what they did to him. Hopefully, like all other people, Mike will learn more from his mistakes and shortcomings than his successes. Hopefully, he will be more financially responsible."

For a man that lived so lavishly, Tyson said his meager lifestyle suits him fine.

"Being without money for three years, I don't know what I'll do if I get it again," Tyson said. "I'm not even interested in being that person again. I don't want to be that flashy guy with the flashy houses."

Tyson's homes were infamously flashy. He spent at least $15 million on five homes and essentially lost three of them in his divorce from Turner. She was given their $4 million mansion overlooking the Congressional Country Club in Bethesda, where she raises their children, Rayna, 7, and Amir, 6. Tyson and Turner met while he was imprisoned in Indiana and they were married in April 1997. She accused him of adultery and filed for divorce in January 2002.

Turner, a pediatric resident at Georgetown University Medical Center, also will receive $2 million from the sale of Tyson's 61-room, 48,000-square foot home in Farmington, Conn. Rap star 50 Cent has agreed to buy the house for $4.1 million. Turner will get about $1.5 million from the sale of Tyson's two homes in Las Vegas, which sit on lots next to Wayne Newton's ranch. The sale of the Las Vegas homes are expected to generate about $2.5 million, after their $1.7 million mortgages and $300,000 liens are paid.

"Mike lived very, very well for 20 years," Finkel said.

Tyson said his only regret is that he never put away money for himself. Just recently, he opened a money market account for the first time and deposited just over $5,000. Tyson said he has set up trust funds for his five children (he owes about $73,000 in outstanding child support to the mothers of two of his children).

"I took care of everybody else," Tyson said. "But I never took care of myself."

Finkel said he and others tried to slow Tyson down during his days of free spending, but Tyson never listened. Finkel said a portion of Tyson's earnings from his future fights will be invested for his retirement. As for the $400 million Tyson already has blown, Finkel is still trying to figure out where all of the money went.

"It's sad but not tragic," Finkel said. "It would be tragic if he had no opportunity to come back. Mike is going to come back and he'll be champion again and pay off his debts."