Wylys Must Pay ‘Staggering’ $300 Million They Don’t Have

By Bob Van Voris, Bloomberg.com

Samuel Wyly and the estate of his brother Charles must pay more than $300 million they say they don’t have after having been found liable for using offshore trusts to hide stock holdings and engage in illegal trading.

U.S. District Judge Shira Scheindlin in Manhattan today ruled that the Wylys must forfeit $187.7 million plus interest that she estimated will increase the total to $300 million to $400 million, an amount she called “staggering.” In May, a jury found that the brothers, who established Michaels Stores Inc. as a public company, perpetrated a fraud over 13 years. Charles Wyly was killed in an auto accident in 2011.

Scheindlin disregarded arguments by the Wylys that they have a combined net worth of only $119 million and that a larger penalty would bankrupt them. The award, in favor of the U.S. Securities and Exchange Commission, is one of the largest ever against individual defendants, Scheindlin said.

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