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
How to Effectively Use Contracts to Manage Risk
Key provisions in your contracts, including those relating to indemnification, insurance, and defense, are essential to contract risk management. While sometimes considered “boilerplate,” these provisions play a pivotal role when determining which party is responsible for certain costs and liabilities. They must always be negotiated and drafted carefully. Indemnification Clauses Businesses should never overlook the […]
Author: George McGowan
Understanding Portability for Estate and Gift Tax
Portability of estate and gift tax enables a surviving spouse to inherit any unused portion of their deceased spouse’s federal estate and gift tax exemption. So, if one spouse doesn’t utilize their full exemption, the surviving spouse can effectively double their exemption amount with regard to estate tax liability. For married couples, portability offers a […]
Author: Marc J. Comer
Pet Trusts in New Jersey and New York: A Practical Estate Planning Tool
For many of us, pets are more than companions—they are members of the family. Yet they are often overlooked or inadequately provided for when it comes to estate planning. A pet trust offers a legally enforceable way to ensure that your animal continues to receive proper care if you become incapacitated or pass away. As […]
Author: Marc J. Comer
How Can Trusts Be Used in Business Succession?
For many New Jersey business owners, a closely held company represents decades of work, financial investment, and personal sacrifice. Trusts in business succession planning are one of the most effective tools for protecting that value, allowing founders to control how and when the business passes to the next generation while reducing the risk of disputes, […]
Author: George McGowan
Read Before You Sign: IT Contract Pitfalls Every NJ Business Should Know
In today’s digital economy, New Jersey businesses of all sizes rely heavily on technology vendors, software providers, cloud platforms, and managed IT services. Whether your company is purchasing software, migrating data to the cloud, engaging a cybersecurity consultant, or entering into a long-term managed services agreement, a careful IT contract review can have significant operational, […]
Author: George McGowan
New York NDA Requirements for Businesses
Non-disclosure agreements (NDAs) remain a critical tool for protecting sensitive business information. However, New York NDA requirements have evolved, and businesses must ensure these agreements are carefully drafted to remain enforceable. In a competitive market like New York City, NDAs are commonly used to protect proprietary information, client relationships, and strategic plans. At the same […]
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.