The Wylys brothers were accused by the SEC of using sham trusts and subsidiaries in the Isle of Man and the Cayman Islands to conceal sales of stocks of public companies they were directors of. The SEC has been investigating the inner workings of the alleged fraud for some six years and recently decided that they had enough evidence to file suit.
The brothers have always vehemently denied the charges through their lawyer, but have never publicly addressed the issue themselves, until now that is.
Months of settlement talks between the Wylys brothers and the SEC have made little progress toward a resolution and now the brothers are speaking out about the suit in this New York Times article.
“They gonna lose,” said Sam Wyly. They gonna get nothing.”
The brothers claim the goal of the trusts was estate planning and tax deferral. They claim that if there were mistakes in establishing the trusts or disclosing revenue it was the fault of experts hired by the brothers to manage the trusts.
The SEC looks at the accusations a little differently, saying that the Wylys brothers knew or should have known, that they were violating the law.
It will be very interesting to see how this one unfolds in the coming months.