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Ex-corporate raider files for bankruptcy

Paul Bilzerian, who recently paid less than $400,000 in a filing involving $300-million in debt, seeks protection again.


© St. Petersburg Times, published January 5, 2001

TAMPA -- Claiming nearly $140-million in debts and just $15,805 in assets, Avila resident Paul Bilzerian has filed for bankruptcy.


Bilzerian, who lives in the Tampa Bay area's largest home and whose career as a corporate takeover artist was cut short by a jail term, first sought bankruptcy protection from his creditors in 1991. Judge Alexander Paskay finally closed that case in June after Bilzerian paid less than $400,000 to settle debt claims that exceeded $300-million.

"It was the biggest headache of any case that I've ever done," said Stephen Meininger, who served as trustee's counsel in the case.

Now, just six months later, the 50-year-old Bilzerian again has filed for protection from creditors, claiming meager assets that include an estimated $100 in used clothing and a $5 Casio watch. And once more, he's acting as his own attorney, a role he's pulled off well.

Perhaps Bilzerian's greatest achievement so far has been staving off creditors who would like a piece of the 11-bedroom, 37,000-square-foot home he shares with wife Terri Steffen, 46, and other family members. Florida law has been helpful in that regard: Under the state constitution, said Clearwater attorney Alan Gassman, a bankruptcy filer's primary home is protected from most creditors.

But Judith Starr, assistant chief litigation counsel at the Securities and Exchange Commission, said Bilzerian has used other tactics to shelter his Avila home, a Minnesota vacation house, stocks and other assets from creditors.

She said he has shuffled ownership of those assets between himself, Steffen and a family trust in the Cook Islands in the South Pacific.

Bilzerian did not return calls to his home or to Cimetrix Inc., the Salt Lake City software company of which he is president and chief executive.

But Starr, whose agency is in litigation with Bilzerian over a 1993 judgment worth $62-million plus interest, said the purpose of Bilzerian's latest bankruptcy filing was obvious: to block a court-appointed receiver from finding out the nature and amount of his assets, which otherwise might be liquidated and distributed to creditors including the SEC.

"There clearly is no purpose to file except to disrupt the receivership," she said. "It sort of fits a pattern."

Bilzerian made a name on Wall Street in the 1980s as a so-called corporate raider, taking over companies such as Singer Co. before being convicted of securities fraud and conspiracy to defraud the government in 1989. He served 13 months in prison and paid a $1.5-million fine.

After his conviction, the SEC filed a civil suit, which Starr said the agency won despite repeated challenges. It has been fighting for payment from Bilzerian ever since. But the court's inability to get a handle on his assets has jammed the process.

Bilzerian's ability to shield his family's enormous home from creditors has made him something of a poster child for organizations opposed to Florida's special exemption. In the early 1990s, the home was even featured in a segment on the television news show 60 Minutes.

Bilzerian also is engaged in local battles.

Several years ago, he filed suit against the Hillsborough County appraiser's office, claiming the agency overestimated the value of his home. Agency officials say the lawsuit remains in play and that although Steffen paid the home's 2000 tax bill of just over $82,000, the family hasn't yet paid property taxes for the four prior years.

Starr said the SEC is determined to make Bilzerian pay what he owes that agency. A contempt order that is in effect against him may help. But those who have observed Bilzerian in action don't discount his courtroom skills.

"I saw him years ago defending himself in the bankruptcy court," said attorney Gassman. "He's as good a lawyer as any I've ever seen."

- Times staff researcher John Martin contributed to this report.

Recent coverage

Change may cost debtors shelter (November 12, 1999)

No time to rest for Paul Bilzerian (March 15, 1999)

From one big house to another (February 19, 1999)

In shift, Bilzerian sues neighbor (October 3, 1998)

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