The SEC said in its complaint said that Samuel and Charles Wyly created “an elaborate sham system” of trusts and companies, on the Isle of Man in the Irish Sea and in the Cayman Islands that produced US$550 million in undisclosed gains on stock sales.
The SEC said that the Wylys violated securities laws that require corporate directors and executives to report stock trades.
The regulatory agency accused the brothers of reaping the profits “while sitting on corporate boards by trading stock in those public companies through hidden entities located in foreign jurisdictions to conceal their ownership and trading of those securities”.
The SEC also charged their US-based attorney, Michael French, and their stockbroker, Louis Schaufele, for their roles in the alleged scheme.
“The cloak of secrecy has been lifted from the complex web of foreign structures used by the Wylys to evade the securities laws,” said Lorin Reisner, deputy SEC enforcement chief.
“They used these structures to conceal hundreds of millions of dollars of gains in violation of the disclosure requirements for corporate insiders,” she added.
The SEC said the offshore trusts and management companies were set up by the Wylys beginning in 1992.
The charges came as another Texas billionaire, Allen Stanford, faces criminal and civil charges in an alleged US$7 billion Ponzi scheme involving his Stanford International Bank in Antigua and Barbuda.
Stanford, who is currently in a Houston, Texas, jail, goes on trial in January.
No comments:
Post a Comment