University alum Sam Wyly, a Dallas-based billionaire businessman, filed for bankruptcy after the U.S. Securities and Exchange Commission ordered him to pay about $400 million dollars for hiding stock holdings in offshore trusts and his involvement in illegal trades.
According to Bloomberg News, Wyly, who graduated from the University in 1957, was sued by the SEC, his second-largest creditor after the IRS, in 2010. Wyly owes the SEC about $198.1 million and officially filed for bankruptcy in October.
The calculation of the debt stems from the decision of a federal jury held last May in New York. The jury found Wyly and his late brother Charles, who died in 2011, responsible for the misuse of offshore trusts. According to Bloomberg, U.S. District Judge Shira Scheindlin listed the forfeiture of $187.7 million plus interest. Sam Wyly accounted for $123.8 million of the forfeiture and the estate of Charles Wyly accounted for the rest. With the interest calculated, the total amount is in the range of $300 million to $400 million.
According to the U.S. Bankruptcy Code Chapter 11 petition, Wyly developed Sterling Software, Inc. and Michaels Stores, Inc. Bloomberg reported Wyly said he sold Sterling in 2000 and Michaels Stores six years later.
Wyly made the Forbes 400 in 2010 and has a building named after him on the University’s campus, Sam Wyly Hall. Along with the debt owed to the SEC, Wyly is guaranteed to pay $500,000 of annual support to his ex-wife.