Seventeen years after he formed Fleetwood Mac with bassist John McVie, drummer Mick Fleetwood seems almost unscarred by the passage of time. On this day, a typically sunny L.A. offering, Fleetwood looks hale and hearty, and he talks with enthusiasm about his upcoming recording and touring plans with Fleetwood Mac and with his own group, Mick Fleetwood's Zoo. As you take it all in, it's easy to forget that Mick Fleetwood is flat broke.
On March 28th, Fleetwood filed for a Chapter 7 bankruptcy in the Central District of California, listing assets of $2,404,430 and debts of $3,697,163. After a hearing on May 29th, all of his assets were turned over to a court-appointed trustee, Arnold Kupetz. "Our job is to take possession of everything Mr. Fleetwood owns, to sell it and make a distribution to the creditors and the tax people," says Jan Copley, an attorney assisting Kupetz. To satisify creditors, Copley and Kupetz have attempted to sell Fleetwood's $2.2 million Malibu home – known as the Blue Whale – and have arranged with BMI to receive all royalties due him, including one-third of the proceeds from Fleetwood Mac Music, which holds the rights to the band's hit songs.
Still, there won't be much to go around for Fleetwood's fifty creditors. "Mr. Fleetwood had a lot of assets, but unfortunately, most of them appear to be not worth much," says Copley, also noting that most of Fleetwood's more valuable possessions – his home, for instance – are tied up as security for specific debts. In other words, while his "secured" creditors have claims on items of Fleetwood's unliquidated property, his "unsecured" creditors – owed a total of $1,018,748 – are probably out of luck.
The obvious question arises: how could Mick Fleetwood – not only the founder but, for five years, the manager of one of the most financially successful rock bands ever – get in a spot like this? Answer: through a combination of bad timing, bad judgment, bad luck and, above all, hellaciously high interest rates. "Basically, I bought too much real estate," Fleetwood says. "Bank loans and payments go funny. There's no tax weirdness [though his bankruptcy schedules indicate that Fleetwood owes $107,921 in city, state and federal taxes] or anything like that. You just go too far into debt. There's not enough money coming in to keep the boat floating."
Fleetwood Mac's lawyer, Mickey Shapiro, stresses that Fleetwood's financial problems are not attributable to typical rock & roll excess. "Mick loves great drums, cars, beautiful women and magnificent pieces of real estate," he says, "but he is not in the classic sense a heavy roller. He's not on the Beverly Hills Diet – champagne and cocaine."
Fleetwood's ship started sinking in the spring of 1980. "I bought some property in Australia, and that probably started the whole crumbling effect." Fleetwood says. According to Shapiro, Australian law required that property purchased by a foreigner be paid for almost wholly in cash. To buy the property, Fleetwood took a $500,000 loan from Security Pacific National Bank. Warner Communications guaranteed the loan for him, in exchange for a deed of trust – a mortgage – on his Beverly Hills home, and for shares in a number of Fleetwood Mac-related companies of which Fleetwood was part owner.
Fleetwood had intended to move to Australia permanently, but after living there for three weeks, he found that the property was, in Shapiro's words, "unmanageable, impractical and too goddamned far away." So Fleetwood sold the house and, in the opinion of one person familiar with the case, "took a bath" on the exchange rate and on the loan payments.
Then, in December of 1981, Fleetwood purchased the mansion in Malibu, getting a $1.6 million mortgage from Columbia Savings and Loan. But according to Copley, Fleetwood "took the loan with Columbia Savings at a time when interest rates were about as high as they ever went. The loan was at seventeen-percent interest and his monthly payments were $20,000. That's a lot for anyone. Even Mick Fleetwood." To protect its guarantee for Fleetwood's initial loan from Security Pacific, Warner Communications obtained a second mortgage on the house.
"On huge amounts of money," notes Fleetwood, "the interest can mount up real quick."
To pay these ever-burgeoning debts, Fleetwood apparently was hopeful that his income would continue at its multimillion-dollar late-Seventies level. But other members of Fleetwood Mac became involved in solo projects, so Fleetwood's income for 1982 and 1983 was only $350,000 and $255,000.
A series of bad investments didn't help, cither. A $629,000 oil-and-gas-drilling venture – financed by two unsecured letters of credit – flopped. Investments designed to lose money for tax purposes wound up losing far more than anticipated. And according to Copley, Fleetwood says he still owes Warner Communications money advanced on Fleetwood Mac's Tusk and Mirage albums. No wonder Fleetwood says that this bankruptcy had been coming "for years."
The lanky drummer refuses to blame his predicament on bad advice. "I'll take full responsibility," he declares, "rather than whispering in ears, 'Hey, someone should have told me.'"
Fleetwood is quick to note that the bulk of his debt was outstanding bank loans: "At least it's not out of anyone's private pocket that way." But Fleetwood was also in arrears to more than thirty smaller businesses and individuals: $13,814 to the Mayfair Market of Malibu; $804 to the Malibu Animal Hospital; $437,30 to Rodeo Limousine Service. Such creditors have little legal recourse.
Fleetwood says he didn't mean to stiff the little guys, "but there was literally no money. I'm not being flippant about what has happened.
"It was put off as long as it was physically possible to be put off. But you start getting into a situation that doesn't do anyone any good."
Fleetwood is bemused by the general reaction to his bankruptcy. Fans seeking his autograph have been pressing dollar bills into his palm. Indeed, for the forty-two-year-old musician, the entire escapade merely reconfirms some of his lifelong beliefs. "It's lovely to have money, and certainly more preferable not to have this sort of thing happen. But the perspective in which you approach having money is much, much more important than the money."
He remains hopeful that he can repay some of his small-fry creditors – and some of those contacted report that they have indeed received their money. Others, though, have not. "He's had credit here for years, since the beginning," says one employee at John Carruthers Guitar Repair, to which Fleetwood owes $228. "This is just a scam so when the next album comes out, he can keep all the money."
As a matter of fact, he can do exactly that. Kupetz and the estate have the rights to all royalties that Fleetwood may earn from any existing recordings. But any income from recordings made by Fleetwood after the date he filed for bankruptcy is his to keep even though the recordings are part of a contract with Warner Bros, that still has five or six albums to go. "That's why he filed for bankruptcy," says Copley. "You put your old debts and creditors behind you, and move on to new income."
Which is what Fleetwood plans to do – without his house, without his cars and without much of his musical equipment. "I'm doing just fine now." he says. "I'm not a raving lunatic. If you let the whole thing collapse and don't have any sense at humor, I think you're in big trouble."
This story is from the August 30th, 1984 issue of Rolling Stone.