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Dallas-based billionaire Sam Wyly has filed for bankruptcy after he was ordered by the Securities and Exchange Commission to pay anywhere from $200 million to $455 million for his involvement in a massive offshore fraud scheme that netted him and his brother more than $550 million, MLive.com reported today. U.S. District Judge Shira Scheindlin ruled in September that Wyly and his late brother Charles Wyly, Jr. were involved in a 13-year fraud in which the two created 17 trusts and 40 subsidiary companies before hiring a team of lawyers and an offshore accountant to hold records outside the U.S. The SEC outlines a system of trusts in the Isle of Man that Business Insider reports have earned the brothers, the one-time owners of the arts and crafts retail chain Michael Stores Inc., $553 million in untaxed profits over a decade of hidden trades in four companies that they controlled. Scheindlin said that the judgment against Wyly and his brother's estate is among the largest ever imposed against individuals. Sam Wyly made Forbes' list of the 400-richest Americans in 2010 with a net worth of $1 billion. The $455 million figure is the result of $195 million owed plus interest payments.

Total bankruptcy filings in the United States decreased 12 percent in October 2014 from October of last year, according to data provided by Epiq Systems, Inc. Bankruptcy filings totaled 78,957 in October 2014, down from the October 2013 total of 89,948.  Consumer filings also declined 12 percent to 76,110 from the October 2013 consumer filing total of 86,360. Total commercial filings in October 2014 decreased to 2,847, representing a 21 percent decline from the 3,588 business filings recorded in October 2013. Total commercial chapter 11 filings dipped 27 percent to 384 filings in October 2014 from the 529 commercial chapter 11 filings registered in October 2013. Average total filings per day in October 2014 were 2,547, a 12 percent decrease from the 2,902 total daily filings in October 2013.

Texas businessman Charles Wyly’s widow, who last month told a bankruptcy judge she was left insolvent after the investor’s death in a car crash, said assets including two homes and $4 million worth of furs and jewelry can’t cover what she owes creditors, Bloomberg News reported yesterday. Caroline “Dee” Wyly listed assets of $67 million and debt of $81 million in a filing yesterday in U.S. Bankruptcy Court in Dallas, where she lives in a $6.7 million mansion. The $14 million shortfall doesn’t count an “unknown” liability in a fraud lawsuit the Securities and Exchange Commission won against her husband’s estate this year, she said. The filing was made the same day a federal judge in Manhattan granted the SEC’s request for a temporary asset freeze against Caroline Wyly and the estate, as well as her billionaire brother-in-law Samuel Wyly, who was a defendant in the same lawsuit and who also filed for bankruptcy.

A personal bankruptcy stands out as a conspicuous blemish on a consumer’s credit report for as long as 10 years, but the barrier it presents to obtaining a mortgage doesn’t have to last that long, according to a New York Times analysis yesterday. Many individuals who sought bankruptcy protection during the recent recession, which officially ended in 2009, may now be eligible to apply for a mortgage. The mandatory waiting periods to apply for a mortgage backed by Fannie Mae or the Federal Housing Administration last from two to four years. Personal bankruptcy filings climbed steadily beginning in 2007 before peaking in 2010 at about 1.5 million filings, according to the American Bankruptcy Institute. Households that went through a chapter 7 liquidation bankruptcy must wait four years from the date of discharge (when their debts are wiped out) before applying for a conventional loan. The waiting period, according to Fannie Mae guidelines, is two years from discharge for chapter 13 bankruptcies, in which debts are partially repaid under a court-approved plan. The wait for a Federal Housing Administration loan is two years for chapter 7, and one year for chapter 13, provided the individual has kept up with payments under the reorganization plan and has permission from the court.

Texas businessman Charles Wyly had “no significant life insurance” when he died in a 2011 car crash, leaving his widow insolvent and dependent on family in the midst of a U.S. regulator’s fraud lawsuit against her husband’s estate, according to bankruptcy court records, Bloomberg News reported yesterday. Caroline “Dee” Wyly, exhausted the liquid assets in her husband’s estate and can no longer tap the funds to pay for living expenses or litigation, her lawyer said in a filing two days ago in U.S. Bankruptcy Court in Dallas. The investor’s widow, known in Texas for her philanthropy in education and performing arts, filed a chapter 11 petition on Oct. 23, citing financial fallout from the Securities and Exchange Commission case against her husband in Manhattan. She isn’t accused of wrongdoing.

Zane, the best-selling author who has sold millions of steamy novels and is listed as executive producer of a new movie, Addicted, based on one of her books, filed for bankruptcy in June, months after being dubbed Maryland’s top individual tax cheat, the Washington Post reported yesterday. The Prince George’s County, Md.-based erotica author, who is sometimes compared to “Fifty Shades of Grey” writer E.L. James, filed for chapter 7 bankruptcy in U.S. Bankruptcy Court in Maryland on June 11. Zane, whose real name is Kristina Laferne Roberts, listed her total assets at more than $1.4 million, including her $950,000 “primary residence” in Upper Marlboro and a $530,000 “investment property” in Bowie, according to court records. She claimed total liabilities of more than $3.4 million, including $337,151.85 in back Maryland taxes and more than $1.4 million to creditors. She listed the amount that she owes the IRS as “unknown.”

Total bankruptcy filings in the United States decreased 16 percent in August 2014 over August of last year, according to data provided by Epiq Systems, Inc., the largest year-over-year drop thus far in 2014. Bankruptcy filings totaled 75,170 in August 2014, down from the August 2013 total of 88,962. Consumer filings declined 15 percent to 72,467 from the August 2013 consumer filing total of 85,125. Total commercial filings in August 2014 decreased to 2,703, representing a 30 percent decline from the 3,837 business filings recorded in August 2013. Total commercial chapter 11 filings dipped 41 percent to 357 filings in August 2014 from the 604 commercial chapter 11 filings registered in August 2013. To read ABI’s full statistical release, please click here: http://news.abi.org/press-releases/august-bankruptcy-filings-register-l…

Federal and state consumer protection watchdogs on Wednesday took aim at lawyers, filing more than three dozen suits targeting law firms and other entities for running illegal foreclosure-relief scams, The National Law Journal reported Wednesday. The nationwide enforcement sweep, dubbed Operation Mis-Modification, was led by the Federal Trade Commission, the Consumer Financial Protection Bureau and attorneys general or other regulators from 15 states, including New York, Florida and Michigan. The suits — six by the FTC, three by the CFPB and 32 by state attorneys general — make similar allegations: Lawyers or other scammers charged illegal advance fees for services and falsely promised to prevent foreclosures or renegotiate troubled mortgages. The agencies are seeking compensation for victims, civil fines and injunctions, and in some cases have also secured temporary restraining orders freezing the firms' assets.

A Dallas woman was sentenced on Friday to one year and one day in federal prison for making false statements during her multiple bankruptcy filings, Dallas Morning News reported Friday. Estela Martinez, 54, had pleaded guilty in August 2013 to one count of making a false statement under penalty of perjury related to bankruptcy filings. Martinez’s prosecution is part of U.S. Attorney Sarah R. Saldaña‘s effort to crack down on bankruptcy fraud in the Northern District of Texas. Under the office’s Bankruptcy Fraud Initiative, seven people have been charged with various felony offenses since February 2013. Four of the defendants have entered guilty pleas, two of whom have been sentenced. Another defendant is scheduled for trial, and two others remain fugitives, the U.S. attorney’s office said. Martinez was unsuccessful the first time she filed for bankruptcy in 2009, and she filed five more times between then and 2012.

Total bankruptcy filings totaled 479,362 nationwide during the first six months of 2014 (Jan. 1-June 30), a 12 percent decrease from the 544,561 total filings during the same period a year ago, according to data provided by Epiq Systems, Inc. The 460,870 total noncommercial filings for the first half of 2014 represented a 12 percent drop from the noncommercial filing total of 520,992 for the first half of 2013. Total commercial filings during the first six months of the year were 18,492, representing a 22 percent decrease from the 23,569 filings during the same period in 2013. Commercial chapter 11 filings also fell during the first half of 2014 as the 3,009 filings represented a 13 percent decrease from the 3,454 commercial chapter 11 filings during the first six months of 2013.