U. S. authorities said on Thursday that Samuel and Charles Wyly, who made billions in the sale of a business software firm, have been charged with securities fraud.

The New York Times reported that the Securities and Exchange Commission, following a six-year investigation, charged the Wyly brothers, based in Dallas, with carrying out a scheme that netted them $550 million. The Washington Post has reported that an attorney and stockbrokers for the Wylys' were also charged.

The Times further said that the founders of Sterling Software sold the company for $4 billion in stock in March 2000. The SEC charges announced Thursday include insider trading that investigators said allowed the Wylys to realize more than $31 million in gains.

Most of the alleged illegal activity involved stocks of Michaels Stores, Sterling Software, Sterling Commerce and Scottish Annuity and Life Holdings, companies for which the Wylys held executive positions or seats on the board of directors.

The Wylys used the proceeds of the alleged fraud to acquire art and jewelry, as well as $100 million in real estate, the SEC said. They are also accused of directing the money to charitable contributions.

The Post also reported that the Wylys have been politically active, donating to Republican causes.

The brothers traded more than $750 million in stock, using a system of accounts and companies in the Isle of Man and the Cayman Islands that they set up, said Lorin L. Reisner, deputy director of enforcement at the SEC.

Reisner said, "The cloak of secrecy has been lifted from the complex web of foreign structures used by the Wylys to evade the securities laws."

The SEC charges "are without merit" and the Wylys' "expect to be fully vindicated, said William Brewer, an attorney for the Wylys. (With Inputs from Agencies)