Wyly Insider-Trading Trial Opens

Apr 4 2014 | 10:06am ET

Maverick Capital and Ranger Capital founder Sam Wyly ran a massive $550 million insider-trading scheme, the Securities and Exchange Commission told a Manhattan federal jury yesterday.

The trial in the SEC's civil case against Wyly and the estate of his late brother Charles opened in earnest yesterday, with SEC lawyer Bridget Fitzpatrick telling the panel of eight women and four men that it is "time to hold Sam and Charles Wyly accountable." The SEC alleges that the two used an "elaborate sham system" of offshore companies and family offices to trade shares of companies on whose boards they sat, often diverting the profits to Maverick and Ranger.

Neither hedge fund has been accused of any wrongdoing.

The scheme lasted 13 years, Fitzpatrick said. The SEC wants Wyly and his brother's estate to pay $550 million in restitution.

Wyly's lawyer, Stephen Sussman, rejected the allegations.

"These men are law-abiding citizens that were trying to follow what the SEC requires," he said in his opening. "They were not liars, fraudsters or cheaters."

Charles Wyly died in a car accident in 2011, about a year after he was sued by the SEC.

In Depth

Financial Industry Blockchain Consortium R3 To Open-Source Platform Code

Oct 20 2016 | 9:03pm ET

Bitcoin's blockchain technology has spawned a flurry of activity among fintech startups...


U.S. Trust's Beard: The Rapid Growth of the Art Lending Industry

Oct 7 2016 | 10:55pm ET

Alternative investment managers have emerged as some of the most significant art...

Guest Contributor

Hedge Fund Marketing – Tips for Your Initial Sales Meeting

Sep 29 2016 | 5:46pm ET

There are two main goals a hedge fund should have for an initial in-person sales...