Kerry's drowning in debt

By Matthew Acton

WAYWARD Kerry Katona is on the brink of going bust after blowing a fortune on cocaine, booze, partying and flash cars.

Despite being on TV EVERY night in Iceland's I'm A Celebrity ads, the hard-up star is drowning in a tsunami of debt.

The taxman alone wants £200,000 by the end of the year and if she can't find the money she's facing bankruptcy.

In desperation Kerry and her husband, former drug dealer Mark Croft, have now hired a team of professional insolvency advisers to help them DODGE bankruptcy court, AVOID paying the huge sum, and DUCK £60,000 of loans and credit card bills.

But the experts fear that is just the tip of the iceberg and the true total of the former Atomic Kitten's debts could top £1MILLION.

Even with the Inland Revenue off her back, Kerry—expecting her fourth child—could STILL be made bankrupt by other creditors and lose her £1.2m home and fleet of luxury cars.

Click here for pics of Kerry

The shock truth about her finances is revealed in our astonishing table opposite.

In one year alone Kerry has EARNED a fabulous £1.5 million but she has SPENT at least that much.

A pal blamed new husband Croft for Kerry's cash crisis.

The friend told us: "Until Mark came along Kerry had been fairly careful with money. Sure, she's stuck a fortune up her nose in the form of cocaine but she never lived the showbiz life with the monster house and string of posh cars. Then as soon as she got together with Mark she moved into a mansion and suddenly there were Aston Martins, Porsches and Lamborghinis on the drive.

"Yes, Kerry does okay but she's not bringing in footballer wages and now the debts are becoming unmanageable.

"It's got to the stage where she dreads the postman coming with another bill.

"She had to get these insolvency experts in because she simply can't keep up with her payments.

"If something drastic isn't done they'll be bankrupt and out on the streets."

Former I'm A Celebrity winner Kerry made the decision to call in deal fixers W3 Debt Solutions with advice from her accountant David McHugh.

Plight

Friends are surprised she is relying on McHugh, a convicted conman once jailed for ripping off firms who came to him for help in RECOVERING bad debts.

According to their website, W3—based in Chorley, Lancashire—tackle a client's creditors, explain their plight and negotiate a deal called an IVA (Independent Voluntary Agreement) to avoid bankruptcy.

This often writes off 75 PER CENT of the debt. In return, the customer must keep up payments and clear the sum within five years.

But Kerry is likely to get just 50 per cent discount because of the high figures involved. The agreement would give her breathing space, but if she can't manage the debts bankruptcy will follow.

Assets like her home and vehicles will be sold by the Official Receiver and any profits paid to her creditors. Fans will be astonished at how a big-money telly star can get in such a mess.

Kerry rakes in £750,000 a year as the face of frozen food giants Iceland and between £300,000 and £400,000 from glossy magazine OK! An insider at the mag revealed the payment for Kerry's weekly column had recently been cut from £3,000 a week to £2,000.

Bosses—alarmed at the string of News of the World exclusives exposing her drug addiction—urged her to present a more wholesome image or be sacked.

Our source said: "Although her pay for the column was cut, Kerry earns extra from stories that make the front cover. They work out around £30,000 a time, but much more for big events like her wedding in Italy, although a large part of that was swallowed up by the huge cost of the bash."

Iceland were also appalled at bad publicity surrounding their star and barred her from appearing in the TV ads. They cut her fee and just used her as a voice-over.

But in the current hit run of I'm A Celebrity Kerry is back on screen in sponsor Iceland's high-profile commercials, alongside Jason Donovan. Both stars are former contestants on the show.

A source said: "Kerry was frantic with worry that she was being dumped by Iceland. It would cost her thousands. So she was hugely relieved when she was asked back."

On top of that she is said to have earned £300,000 from putting her name to two ghost-written novels.

While Kerry still has money coming in, including £100,000 a year from promotional appearances—the problem is her vast overheads, such as the £1MILLION mortgage on her house in Wilmslow, Cheshire.

After all that expensive partying she was unable to put down a large desposit on the property. Even with an interest-only deal it would cost a whopping £6,000 a month. Then there's £4,000 a month HP payments on the couple's £100,000 Aston Martin Vantage, £135,000 Lamborghini Gallardo, £80,000 Porsche 911, £55,000 Mercedes saloon and £20,000 Chrysler Voyager—plus running costs. The insurance bill alone is about £30,000 a year—and premiums will rocket following the couple's recent burglary.

Although Kerry says she is now clean, cocaine was costing her £1,000 a week in the heavy snorting days.

Holidays don't come cheap either. So far this year Kerry and Croft have shelled out £50,000 to fly all their family to see them renew their wedding vows in Italy, and £20,000 for a honeymoon in Mauritius.

Kerry also pays huge nanny fees for her three daughters Molly, Lilly-Sue and Heidi. And she is racking up massive legal bills on TWO custody battles.

She is fighting ex-hubby Brian McFadden, who wants to take Molly and Lilly-Sue because he believes drug problems make Kerry an unfit mum.

She is also paying for Croft to fight ex-partner Louise Oortwyn over their young daughter Keeley. Over the years Kerry admits to splashing countless thousands on buying the friendship of pals and hangers-on. She also bought her mum Sue a house.

Kerry's worried friend told us: "Despite everything it's still Mark who's really the problem. He's bleeding her dry. She's just a cash cow for him and he's spending every penny they've got, and more besides, on flash living.

"If he wants something he gets it, and Kerry pays. And she's not putting any away for the NEXT tax bill covering this year, That'll be about £500,000! She knows the magazine deals won't last for ever and once they start to dry up she's really in trouble. At the moment she can just about manage if she enters into the IVA and some debt is cut. But then she must really cut costs and start to pay her bills.

"If she can't, then bankruptcy and losing her house might be the only option. She'll just be left with the clothes she stands up in. It'll be interesting to see if Mark stands by her then."

Luckily there's one expense Kerry doesn't need to worry about— thanks to her Iceland deal she gets all the free frozen grub she wants.