Michael Jackson was more than $500 million in debt at the time of his death on June 25, 2009, according to new court documents obtained by People on Thursday.
The King of Pop, who died at the age of 50 after suffering from cardiac arrest, reportedly had “exorbitant spending habits” and needed to pay off “accruing debt of $30 million a year,” People reported, citing the Los Angeles Times.
The night of Jackson’s death, he practiced for six hours at the Staples Center for his upcoming “This Is It” residency at the 02 Arena in London. The “Beat It” singer reportedly went through several “grueling” dress rehearsals in preparation for shows scheduled between July 2009 and March 2010.
When Jackson’s family sued AEG-Live for wrongful death in August 2013, certified public accountant William R. Ackerman testified as a witness on behalf of the company, per the L.A. Times. During his testimony in a downtown Los Angeles courtroom, Ackerman spoke about Jackson’s finances, revealing that the singer spent money on travel, presents, furniture, art and charity donations.
“He spent a lot of money on jewelry,” Ackerman told the jurors at the time. “He was tapped out.”
Jackson began accruing debt as early as 1993, according to the L.A. Times. He reportedly owed $140 million by 1998 and Jackson’s debt increased by nearly $170 million between June 2001 and June 2009. According to Ackerman’s testimony, the interest on Jackson’s loans increased during this time, ranging from nearly 7% to 16.8% annually.
The New York Times reported in 2006 that Jackson used his stake in a song catalog — which included songs from The Beatles — as collateral for nearly $270 million in Bank of America loans, per People. Randy Phillips, former CEO of AEG Live, told Rolling Stone that Jackson “wanted people to see his work and not just talk about his lifestyle.”
“Michael was a very smart marketing person,” Phillips said during the 2009 interview. “People say he was feeble and manipulated, but he was powerful and a manipulator. He was ready,” Phillips told the publication. “He wanted to clean up his finances. He was ready to stop living like a vagabond and settle down and earn money again.”
Jackson’s estate was reportedly saddled with the late singer’s debt after his passing. Concert promoter AEG was owed around $40 million, according to the probate petition per People, “and [there was] little hope of generating income from [Jackson’s] already highly leveraged assets.”
According to a March 2024 filing, estate executors attorney John Branca, A&R executive John McClain, and their legal counsel, Jonathan Steinsapir and Saul Ewing, claimed that the estate was on the verge of bankruptcy at the time of Jackson’s death. The Michael Jackson estate is currently valued at more than $2 billion, according to People.