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Well-known socialite files for Chapter 7 bankruptcy

Patricia Kluge, a former socialite and entertainer to the rich and famous, has entered into Chapter 7 bankruptcy with her husband William Moses. And while the couple declined to comment on the exact details of the filing, it is known that the two had some business ventures that did not work out.

The Chapter 7 bankruptcy filing indicated debts of $10 million to $50 million and assets of $1 million to $10 million. Business obligations were listed as the primary reason for debts that are owed to between 50 and 99 creditors. The couple's assets have been placed under the control of a trustee appointed by the bankruptcy court, and a meeting with the creditors is to take place on July 15.

The bankruptcy filing action comes on the heels of failures in negotiations between three banks, with the couple's 18th century mansion, a winery and real estate development of luxury homes.

At one point 62-year-old Kluge, who had received the 23,500 square foot mansion in a divorce from billionaire John W. Kluge had described the home as defining her. However, last year she said that life was now different and she was focusing on winemaking.

However, sources claim that during and after the recession the Kluge Estate Winery & Vineyard did not work out, and Donald Trump ended up buying the majority of the winery business in April after the couple had already defaulted on close to $35 million in loans.

Due to loan defaults, the couple's mansion was also bought by the bank, and the couple's Vineyard Estates subdivision was sold at auction.

Source: Richmond Times-Dispatch, "One-time socialite Kluge in personal bankruptcy," 22 June 2011

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