Joel R. Glucksman
Partner
201-896-7095 jglucksman@sh-law.comFirm Insights
SEC finds Samuel Wyly's bankruptcy budget 'staggering'
Author: Joel R. Glucksman
Date: November 4, 2014
Key Contacts
Back
Texas tycoon Samuel Wyly, 80, has been accused of attempting to deplete his domestic assets in order to impede the ability of U.S. creditors to collect in his bankruptcy.
Wyly filed for protection under Chapter 11 of the bankruptcy law earlier this month, after claiming that he does not have the assets to pay the $300 million that he owes to U.S. regulators for his role in a fraudulent offshore scheme, according to Reuters. He was found liable for fraud in May, which led to U.S. District Judge Shira Sheindlin ordering him and the estate of his late brother Charles to pay damages of $187.7 million plus interest to the U.S. Securities and Exchange Commission. The SEC has since said that the total, including interest, should be $299.4 million, making this one of the largest awards ever sought from an individual defendant.
In a document filed with the U.S. bankruptcy court in Dallas, Wyly listed both assets and liabilities between $100 million and $500 million, according to the news source. As for the reason that he is seeking Chapter 11 protection, Wyly cited the cost of fighting civil claims from the SEC.
In a more recent piece by Reuters, it was reported that a lawyer for the SEC is now criticizing Wyly’s proposed bankruptcy budget. The budget includes almost $7,000 per month for supporting elderly friends and family members and $32,000 per month for assistants.
“We are concerned that the debtor is attempting to deplete domestic assets and making it harder for U.S. creditors to collect,” said Angela Dodd, an SEC lawyer, according to the news source.
Meanwhile, the SEC and the Wylys are contesting whether the hundreds of millions of dollars that remain in offshore accounts should be subject to the bankruptcy. The Wylys argue that this money belongs to their children and other beneficiaries, while the SEC noted that a jury has found that the Wylys control the money.
Late last week, according to Reuters, U.S. District Judge Shira Scheindlin said that she was “not very happy” about the bankruptcy filing and would order Wyly’s assets temporarily frozen. The judge said she would also freeze the assets of Wyly’s brother’s estate, as well as funds held in offshore trusts at the center of the lawsuit by the U.S. Securities and Exchange Commission.
- Practices: Corporate Transactions & Business, Bankruptcy & Creditors' Rights, Bankruptcy Litigation
- Locations: Red Bank, NJ, New York City, Little Falls, NJ
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Related Posts
See all
Crypto Securities Law: When Tokens Become Investment Contracts
The application of traditional federal securities laws to crypto assets continues to evolve. In some cases, the Securities and Exchange Commission (SEC) considers tokens and other digital assets to be securities. This makes them subject to federal securities law, including the Securities Act of 1933 and the Securities Exchange Act of 1934. This classification has […]
Author: Bryce S. Robins
The Due Diligence Process for NY Condominiums and Cooperatives
While the New York City real estate market can be extremely competitive, moving too quickly often backfires. Before purchasing a condominium or cooperative in New York City, it is important to do you homework. Purchasing property in NYC can involve a dizzying number of legal issues. These include condo and co-op rules, rent restrictions, and […]
Author: Jesse M. Dimitro
Smart Contract Legal Issues: Drafting Agreements for Blockchain
Smart contracts feature a unique blend of legal agreement and technical code. This innovation has the potential to reshape how business is conducted. At the same time, smart contract legal issues around enforceability, jurisdiction, identity, and compliance are common. The legal framework for these self-executing agreements is still evolving. What Are Smart Contracts? Smart contracts, […]
Author: Bryce S. Robins
Are Stay Interviews the Key to Retaining Top Talent?
Retaining top talent continues to be one of the greatest challenges facing employers today. Even in an employer’s market, the loss of a key employee can disrupt operations and result in significant costs. While compensation plays a role, long-term retention often depends on workplace culture, communication, and employee engagement. One increasingly popular strategy for improving […]
Author: Angela A. Turiano
Why Secured Transactions Are Important
Secured transactions form the backbone of a wide range of business dealings, including business loans, mortgages, and inventory financing. Because the stakes are often high and relatively minor oversights can have drastic consequences, lenders and borrowers should thoroughly understand how to form an enforceable security agreement that protects their legal rights. What Is a Secured […]
Author: Dan Brecher
Don’t Cash a “Paid in Full” Check Without Understanding the Legal Implications
Cashing a check marked “paid in full” can be a risky endeavor, particularly if you don’t fully understanding the legal implications. If you are owed more than the amount of the check you accept and deposit, you may waive your right to collect the full disputed amount. That is why you should consider either rejecting […]
Author: Dan Brecher
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Sign up to get the latest from our attorneys!
Explore What Matters Most to You.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.