1. A declaration at some point during the evening (it may be declared by friends or a self-declaration), that you are now totally lacking in moral principles or quality for the remainder of the evening; Unscrupulous;
2. Depleted of valuable qualities or characteristics
Yo, my man has a wedding ring and is grinding on everybody in this club... I guess he's declared moral bankruptcy.
Friend: That girl is hella drunk. Since I already declared moral bankruptcy, I'm calling dibs.
You: Damn son, you are one grimy son of a bitch.