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Texas Wheeler Dealer Indicted For $8 Billion Scheme – Updates

February 17, 2009

UPDATE from Reuters: Stanford had links to fund run by Bidens: report

UPDATE from Bloomberg: Stanford Clients’ Mutual Funds May Be Unfrozen, Receiver Says

UPDATE from Lanka Business: Mexico Stanford customers withdraw millions

UPDATE from The Hill:

President Obama‘s campaign has given to charity a $4,600 campaign donation from fugitive money man R. Allen Stanford, who is accused of $8 billion in fraud.

A former campaign aide said the president’s campaign donated the money to the Chicago Coalition for the Homeless.

Sen. John McCain (R-Ariz.), announced he would donate the money he received from Stanford to charity.

The Stanford situation could prove to be a problem for lawmakers of all stripes in Washington.  Stanford and his company have contributed millions to all manner of House and Senate candidates and national party committees over the last decade.

Among the recipients of Stanford’s money are the chairmen of Republicans’ House and Senate campaign committees – Texans Pete Sessions and John Cornyn – and Senate Majority Leader Harry Reid (D-Nev.), along with lots of senators and plenty of Texans.

Also among those receiving money: embattled former Reps. Tom DeLay (R-Texas) and Bob Ney (R-Ohio) and embattled current Rep. Charles Rangel (D-N.Y.), nearly a dozen House Democratic freshmen, former Sen. Phil Gramm (R-Texas), and the political action committee of former Senate Majority Leader Tom Daschle (D-S.D.).

Current senators who have received Stanford money include John Cornyn, Harry Reid, Bill Nelson (D-Fla.), Kay Bailey Hutchison (R-Texas), Max Baucus (D-Mont.), Charles Schumer (D-N.Y.), Chris Dodd (D-Conn.), Byron Dorgan (D-N.D.), Richard Shelby (R-Ala.), Patty Murray (D-Wash.), Maria Cantwell (D-Wash.) and Jack Reed (D-R.I.).

A Texan billionaire has been charged in connection with an alleged $8bn investment fraud following a raid on his office headquarters.

Sir Allen Stanford created a false investment scheme based on selling $8bn worth of deposit certificates that promised “improbable, unsubstantiated, high interest rates”, the Securities and Exchange Commission (SEC) said on Tuesday.

Stanford International Bank, based in the Caribbean island of Antigua, and Stanford Group and Stanford Capital Management, both based in Houston.

HOUSTON — In Texas, Robert Allen Stanford was just another wealthy financier.

But in the breezy money haven of Antigua, he was lord of an influential financial fief, decorated with a knighthood, courted by government officials and basking in the spotlight of sports and charity events on which he generously showered his fortune.

On Tuesday, his reign was thrown into turmoil as a caravan of cars and trucks carrying federal authorities pulled up to the headquarters of his company, the Stanford Group, to shut down what the regulators described as a “massive ongoing fraud” stretching from the Caribbean to Texas, and around the world.

Unknown is the status of investments in as much as $8 billion in high-yielding certificates of deposit held in

The Antigua-based Stanford International Bank

The Antigua-based Stanford International Bank

the firm’s bank in Antigua, which the Securities and Exchange Commission, in a civil suit, said Mr. Stanford and two colleagues fraudulently peddled to scores of investors.

Also unknown Tuesday were the whereabouts of Mr. Stanford — or Sir Allen, as he became known after the Antiguan prime minister knighted him — whose financial activities on the tiny island had raised eyebrows among American authorities as far back as a decade ago.

Like Bernard L. Madoff, who is accused of operating a $50 billion Ponzi scheme, Mr. Stanford offered investment opportunities that sounded almost too good to be true: promises of lucrative returns on relatively safe certificates of deposit that were often more than twice the going rate offered by mainstream banks.

In fact, a substantial portion of the bank’s portfolio was in very illiquid real estate and private equity investments. The portfolio was monitored by only two individuals — Mr. Stanford and James M. Davis, a director and chief financial officer of Stanford Group and the Antigua-based bank affiliate. The Antiguan auditor does not audit the bank’s portfolio or verify its assets.

Mr. Stanford and his firm have emerged in recent years as a recent contributor to various United States lawmakers, focusing particularly on legislators considering bills that could change offshore banking rules. In 2008, he made $3,300 in political contributions to Representative Charles B. Rangel, a New York Democrat, who has presided over legislation easing tax policies for the Virgin Islands as head of the House Ways and allen_stanford_wideweb__470x3410Means Committee.ecbsirrallenstanfordpressconferencep9778bcl68gl

This is the same Stanford of ECB Cricket Team fame.


Cricket tycoon Sir Allen Stanford caught up in spying row

The Texan billionaire behind the controversial $20 million (£12 million) winner-takes-all tournament which split the world of cricket is now at the centre of an international spying row, it can be revealed.

What Now For Sir Allen Stanford?

ECB confirm Allen Stanford deal set to continue

Stanford and England cricket: end of an unlikely affair

Stanford Univ. Sues Allen Stanford For Trademark Infringement

Class action lawsuit filed against Stanford

FACTBOX-Allen Stanford’s financial empire

Why can’t Texas resist adding its name to the latest scoundrel roundup?  Sir Stanford … really!  A British title for a Texan?  Maybe he should run for king, George did.  What a goon. Texans don’t come in 2nd after some yankee, ‘git a rope’.  A measly $8 Billion scam is only ankle deep to Madoff’s lalapalooza.  People are so ready to believe their academy award winning, ‘too good to be true’ lines these snake oil salesmen deliver, they should have their own prize.  Their gullible investors should have a prize of their own, being responsible for their own investments instead of hiring shady gurus, should send them back to school.  Trusting the image instead of the person produces victims.  Well dressed, well fed and well spoken has become this decade’s poster for scam artist.  Yes, we elect these politicians because they are slick with media training.  They are dressed and coached to win your trust and vote.  They have pretty teeth, smell good and twinkle when necessary.  Then they go about their back room business as usual. Texas Senator John Cornyn admits his ties to Stanford.

Cornyn spokesman says Stanford paid for 4-day trip to Caribbean .

WASHINGTON – R. Allen Stanford has given generously to Texas lawmakers in both parties. And his company bankrolled a four-day visit to a Caribbean resort island for U.S. Sen. John Cornyn in 2004.

“It was strictly a fact-finding trip. They have offices in Houston, and they were doing a lot of business out of Antigua,” said Cornyn spokesman Kevin McLaughlin. “There was nothing untoward or unseemly about the company five years ago.”

Cornyn made the trip with his wife, Sandy, in early November 2004, and he disclosed it within days as required: $7,441, paid for by Stanford Financial Group.
Stanford and his employees gave federal candidates $2.4 million nationwide in the last two decades.
Cornyn received $19,700, making him the fifth-largest recipient, according to an analysis by the nonpartisan Center for Responsive Politics.
U.S. Rep. Pete Sessions, R-Dallas, was the second-biggest recipient, collecting $41,375 – nearly all of it in the final weeks of the 2004 race against then-Rep. Martin Frost.
A Sessions aide declined to comment.
Cornyn and Sessions chair the GOP’s Senate and House campaign arms, respectively.
Stanford donated heavily to both sides. His biggest recipient was Sen. Bill Nelson, D-Fla. ($45,900).
Sens. John McCain, R-Ariz., and Chris Dodd, D-Conn., were also in the top five.

The rich who fund our politicians have strings to their voting inclinations.  Not always blatant or obvious, these influences cover our highest elected officials.  At least there will be enough civil complaints and lawsuits in Stanford’s future to insure justice, even if he manages to schmooze a jury (like OJ did).

Case 4:09-cv-00474 (PDF)

IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF TEXAS
HOUSTON DIVISION
JERRY ADAMS, JERRY
EDRINGTON, BEN GOMEZ and
MICHAEL HICKS, on behalf of
themselves and on behalf of all
others similarly situated,
PLAINTIFFS,
-against-
STANFORD GROUP COMPANY,
STANFORD FINANCIAL GROUP,
STANFORD INTERNATIONAL
BANK LTD., STANFORD
HOLDINGS, INC., STANFORD
CAPITAL MANAGEMENT, LLC, R.
ALLEN STANFORD, JAMES DAVIS,
LAURA PENDERGEST-HOLT, JAY
COMEAUX and JASON GREEN,
DEFENDANTS.
§
Civil Action No.
CLASS ACTION
COMPLAINT
JURY TRIAL DEMANDED
[read it all here]

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