Johnny Depp’s Money Woes a Case Against DOL Rule?
Hollywood star Johnny Depp’s lawsuit against his financial advisors is a case against increased regulation of advisors, Bryan Gray claims in Utah’s Davis Clipper.
Depp’s case also shows how some regulations, including the Department of Labor’s fiduciary rule, wouldn’t provide much public benefit, according to Gray. But the rule, which requires retirement brokers to put clients’ interests first and is currently under review following a memorandum from President Donald Trump, could turn out to be “an attorney’s dream,” claims Gray, a columnist for the Clipper. People should be held accountable for their financial failings, he writes, instead of suing their financial advisors as Depp did.
Depp sued his financial manager, the Management Group, in January, seeking $25 million he says he lost due to their mismanagement, the Chicago Tribune reports.
But the firm countersued Depp, alleging that his financial difficulties were due to his own overspending and claiming he still owes them $560,000 in fees on top of the $4.2 million he owes them from a previous loan, according to the Tribune.
According to Gray, Depp is shirking his own responsibility in the matter. The actor had made an estimated $650 million over the past three decades, according to a New York Times analysis cited by Gray.
Nonetheless, Depp faces foreclosure on several assets and owes more than $5 million in interest on his taxes — but that’s not his advisors’ fault, Gray writes. Over the years Depp has spent up to $2 million a month, buying islands in the Bahamas and a whole French town. When friend Hunter S. Thompson died in 2005, Depp spent $3 million on a funeral which included blasting the Gonzo journalist’s ashes out of a cannon, Gray writes.
In his lawsuit Depp also admits he didn’t monitor his own finances, nor his advisors’ investments, but that he should have, writes Gray. If he learned that his advisors were late on his taxes, Depp should have fired them, Gray writes.
Advisors live by their reputation, he writes. While there are bad ones, they’ll end up in prison or stop reaping profits because they’ll lose clients — if their clients pay attention, according to Gray. The review of the DOL’s fiduciary rule requested by Trump, therefore, should not take into account cases like Depp’s, Gray writes.