38. Elwood had a welding business for 13 years that he owned as a sole proprietor. Unfortunately, one of Elwood's key employees, Jake, who served as Elwood's in-house accountant and office manager, embezzled from Elwood's business, and Elwood is now learning that Jake not only took cash from his business over a long period of time, but also ran up plenty of debt in Elwood's name using Elwood's credit card, which Jake monitored. Jake also incurred liabilities to the suppliers of the business by taking delivery of goods into Elwood's business that the suppliers were never paid for. Elwood consulted with his attorney and accountant and learns that he is personally liable for about $400,000 to various creditors of the business. Elwood and his lawyer work feverishly to negotiate with the creditors, but to no avail. Elwood simply does not have the resources to resolve the creditors' claims. Elwood is not able to pay the debt. He asks his lawyer if he can be released from these debts through a bankruptcy proceeding. Elwood is okay with liquidating (selling) whatever equipment and other assets he has, which total value is only about $50,000, distributing the proceeds of those liquidated assets to his creditors, and moving on in life with a fresh start, even if a bankruptcy will be on his record. Otherwise, there is no way he will be able to pay the outstanding debts, and those creditor could hound him for a long time. His lawyer correctly advises Elwood that based on these circumstances and his desires, a proceeding would serve his needs. O Chapter 7 Chapter 11 Chapter 13