Bankruptcy Judge Barbara Houser ruled yesterday that Dallas entrepreneurs Sam and Charles Wyly committed tax fraud when they created a series of offshore trusts in the Isle of Man in the 1990s to shield more than $1 billion for the family tax-free, the Dallas Morning News reported today. Judge Houser said in her ruling that there is “clear and convincing evidence” that the “heart of the Wyly offshore system had been established through deceptive and fraudulent actions.” The ruling means that Sam Wyly will be required to pay the IRS as much as $1.4 billion in back taxes and penalties. At the same time, Judge Houser ruled that Charles Wyly’s widow, Dee, “is innocent of any wrongdoing.” The fact that Dee Wyly “did not know the details of what Sam and Charles had done offshore is clear,” Houser wrote.
