Unfortunately, this is a civil action and the most we can hope for are some SEC fines (which are ludicrously low). Too bad this isn't a criminal case, but at least it's some karmic return for the "Wyly Coyotes," who funded the Swift Boat attacks on John Kerry. (They also funded George W. Bush's attacks on John McCain in the 2000 Republican primaries.)
Oh, and by the way: The Manhattan district attorney's office referred this case to the SEC in 2005. Wonder what took them so long?
Samuel Wyly and Charles Wyly -- billionaire brothers in Texas who have spent millions funding political campaigns -- committed violations of federal securities laws and fraud by using offshore accounts to secretly trade the shares of public companies whose boards they sat on, reaping more than $550 million in profit, according to a Securities and Exchange Commission complaint filed Thursday.
The politically-active Wylys, who have been generous donors to Republican causes over the years, have faced questions in recent years -- including a Senate probe -- about whether they ran an extensive network of tax shelters.
"The cloak of secrecy has been lifted from the complex web of foreign structures used by the Wylys to evade the securities laws," said SEC deputy director of enforcement Lorin L. Reisner. "They used these structures to conceal hundreds of millions of dollars of gains in violation of the disclosure requirements for corporate insiders."
The SEC alleges that the brothers created an elaborate network of accounts and companies in the Isle of Man and the Cayman Islands that they used to trade more than $750 million in stock in four public companies they served as board members. The SEC charges that they also committed an insider trading violation concerning one of the companies, earning almost $32 million.
The Wyly's attorney and stockbroker were also charged.
They also own Michaels, the national arts and crafts chain. So we can blame them for scrapbooking, too!
