Sam Wyly and his late brother Charles Wyly’s estate must pay $299.4 million for committing securities fraud. The final judgment comes months after a jury found them civilly liable.
The SEC sued the Texas billionaire brothers in 2010. The regulator accused them of making $553 million in undisclosed profits when they traded in four companies that used trusts in the Isle of Man. The companies included Scottish Annuity & Life Holdings Ltd., Sterling Commerce Inc., Michaels Stores Inc., and Sterling Software Inc.
The SEC contends that the Wylys established the complex trust system so they could make untaxed profits from concealed trades in companies that they controlled. The scam purportedly occurred over a period lasting a decade.
Charles Wyly died in 2011. The SEC is now going after his estate.
In the final judgment, U.S. District Judge Shira Scheindlin ordered Sam to pay $198.1 million in disgorged gains, in addition to interest. Charles’ estate must pay $101.2 million. The ruling could lead to an appeal in the wake of Sam Wyly’s bankruptcy case. He filed for Chapter 11 protection last year.
In a related ruling, Scheindlin found that the Wylys were entitled to receive an offset for amounts due to the IRS based on sums paid to the Commission.
Our Texas securities fraud lawyers represent investors with claims against brokers, investment advisers, and financial firms. Contact Shepherd Smith Edwards and Kantas, LTD LLP today. Your initial case consultation with our stockbroker fraud law firm is free.
Texas Wyly brothers must pay $299 million in SEC fraud case: judge, Reuters, February 26, 2015
Wyly Brothers Ordered to Give up $299 Million in Fraud Suit, AP/ABC News, February 27, 2015
More Blog Posts:
Jury Says Wyly Brothers From Texas Committed Fraud, Stockbroker Fraud Blog, May 14, 2014
Texas’ Wyly Brothers Ordered to pay More than $300M In Fraud Sanctions, Stockbroker Fraud Blog, September 28, 2014
John Carris Investments Expelled by FINRA, Institutional Investor Securities Blog, January 27, 2015