My Poor Rich Uncle: College Loan Company Bankrupt

The same company that in 2007 took out a full page ad in The New York Times to publicize the conspiracy between college financial aid officers and student loan companies, which helped fuel a full-fledged investigation by New York State Attorney General Andrew Cuomo and led to some federal policy crackdowns, including subsidy cuts to lenders, has filed for bankruptcy protection under Chapter 7 of the bankruptcy code. My Rich Uncle, also known as MRU Holdings, Inc., issued a brief press release on February 9 announcing the filing.

The private student loan company, which stopped originating loans in September 2008 because of liquidity problems, listed four times as many liabilities as assets in its Chapter 7 petition, according to bankruptcy court records. Under Chapter 7, a trustee is appointed to sell the company’s assets. The fair market value of My Rich Uncle’s assets is estimated between $1 million and $10 million, according to court documents filed in Manhattan, and the company listed assets of less than $11 million and liabilities of nearly $46 million in its filing.