Updated – Fireworks Erupt in Wyly Bankruptcy Closing Arguments

U.S. Bankruptcy Chief Judge Barbara Houser told lawyers for Sam and Dee Wyly Wednesday that she has “a lot of heartburn” about some of the tax-free offshore trusts the Wylys established during the 1990s, which the judge said were created based on “flat out lies.”

“Where did the money go?” the judge asked the Wylys’ lawyers about the hundreds of millions of dollars the Wylys deposited in offshore trusts on the Isle of Man during the 1990s. “What happened to the dough? Where did it go?”