US tycoon charged over $8bn fraud

[Sir X]

US tycoon charged over $8bn fraud


Sir Allen is a US businessman and a cricket promoter


Texan billionaire and cricket promoter Sir Allen Stanford has been charged over a $8bn (£5.6bn) investment fraud, US financial regulators say.
The Securities and Exchange Commission said the financier had orchestrated "a fraudulent, multi-billion dollar investment scheme".
The SEC said the fraud was "based on false promises and fabricated historical return data".
English cricket bosses have pulled out of sponsorship talks with Sir Allen.
The charges against Sir Allen, three of his companies and two executives of those companies followed a raid by US marshalls on the Houston, Texas, offices of Stanford Financial Group.
We are alleging a fraud of shocking magnitude that has spread its tentacles throughout the world


Rose Romero, SEC


A US judge has frozen the assets of Sir Allen and the other defendants as well as those of the Stanford Group, its Antigua-based subsidiary Stanford International Bank (SIB) and another subsidiary, investment advisor Stanford Capital Management.
A receiver has been appointed to "preserve assets for investors", the SEC said.
'Close circle'
Sir Allen last year promoted the Stanford cricket series which saw a West Indian all-star team - the Stanford Superstars - beat an England team for a $20m prize.
The England and Wales Cricket Board (ECB) suspended sponsorship negotiations with him following the fraud charges.
The ECB has a five-year deal to play games against the Stanford Superstars.
The SEC said that SIB sold approximately $8bn worth of certificates of deposit to investors, promising "improbable and unsubstantiated high interest rates".
The bank was "operated by a close circle of Stanford's family and friends", the SEC said in a statement. "We are alleging a fraud of shocking magnitude that has spread its tentacles throughout the world," said Rose Romero of the SEC. The charges follow the arrest of US financier Bernard Madoff in December over an alleged $50bn (£35bn) investment fraud.

[Me]

I see the fraud of misrepresentation, but I have not seen anything talking about whether the returns were being generated. Seems like a lot of press material, but leaving out a lot of the details.

[Mosiah]

I think he saw this coming hence his premature withdrawal from Windies cricket.

Gayle dem dun rich arready!

[Assasin]

Well when them charge him for one thing then them can investigate others.

[Baddaz]

Gayle dem dun rich arready!

hope dat dem done get pay in full... no annuity ting roun ere...

[Gamma]

i think a washing machine might be involved eventually

[Karl]

My hope is that our billionares step up and fill that Vacum , Butch & Lee Chin.If they cannot see the benefits of marketing W.I cricket Globally in thier brands name, then lord help us.

[Peter R]

What is Forbes Persaud talking about? How can you lose what you never earned? When you see that statement you realize that they've spent the money before collecting anything... no wonder we are in trouble with such administrations.

http://content-wi.cricinfo.com/ci/co...ry/391297.html

[Sir X]

Allen Stanford lost money to Bernard Madoff and 'lied to cover it up'




Jenny Booth


div#related-article-links p a, div#related-article-links p a:visited {color:#06c;}Read SEC charges against Stanford
Allen Stanford, the billionaire cricket sponsor, lost money with the alleged $50 billion swindler Bernard Madoff but lied to his investors that he had not, say regulators.
The US Securities and Exchange Commission (SEC) lodged 25 pages of allegations with a court in Detroit yesterday, detailing a $9.2 billion fraud allegedly perpetrated by Mr Stanford and three companies he controls.
"Perhaps the most alarming is that Stanford Investment Bank has exposure to losses from the Madoff fraud scheme despite the bank's public assurance to the contrary," said the SEC.
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Multimedia

• Read the SEC charge against Stanford in full

• BLOG: the fall of a billionaire

"Stanford Group Company has failed to disclose material facts to its advisory clients."
The SEC said that an analyst told Mr Stanford and his inner circle in December that SIB had lost about £400,000 in Mr Madoff's alleged Ponzi scheme, which involved paying returns to investors out of the capital invested by lother clients. But in a report to Stanford investors the same month, the bank said it "had no direct or indirect exposure to any of Madoff's investments".
Mr Stanford is the chairman and sole shareholder of SIB, a private offshore bank, and also sole director of its parent company Stanford Group. He refused to appear or give evidence to the SEC investigation.
News of the charges is a stunning blow for the England and Wales Cricket Board and its chairman, Giles Clarke, who signed a controversial, five-year sponsorship deal worth $100 million (about £70.2 million) with Mr Stanford in a glitzy ceremony at Lord's last summer.
The SEC's inquiry into the improbably high rates of return on SIB's investment products had been running since last July, but according to Bloomberg news agency the turning point came last week, when a lawyer for SIB informed the SEC that he wanted to withdraw all the evidence he had given so far.
"The attorney's withdrawal is a massive red flag that screams fraud," said Peter Henning, who teaches criminal and securities law at Wayne State University in Detroit.
"If the SEC hadn't turned up the heat by that point, it did then."
Bloomberg said that a source familiar with the case named the lawyer as Thomas Sjoblom , of Proskauer Rose LLP. Mr Sjoblom is an expert in financial fraud who worked for the SEC for 20 years before joining Proskauer Rose in 1999.
http://www.timesonline.co.uk/tol/new...cle5759709.ece

[Sir X]

Allen Stanford fraud charges trigger panic and run on Antigua bank




(Jewel Samad/AFP/Getty)



Panicked bank customers queue to withdraw their money from the Bank of Antigua, even though it is not implicated in Allen Stanford fraud charges



Image :1 of 2





Jenny Booth


div#related-article-links p a, div#related-article-links p a:visited {color:#06c;}Read SEC charges against Stanford
Fraud charges laid against the cricket mogul Allen Stanford sparked panic today with worried customers staging a run on banks connected to the American financier.
More than 600 people were queueing up outside the Texan tycoon’s Bank of Antigua today in an attempt to withdraw their cash, even though the bank was not one of the companies involved in the fraud allegations.
Similar panic was reported in Panama, where bank regulators stepped in to take control of the Stanford Bank Panama - also not involved in the fraud allegations - after retail customers began a run on the bank to get their money out.
Related Links

• Stanford 'lost money to Bernard Madoff'

• Cricket tycoon's lawyer 'blew whistle on fraud'

• Clarke stands firm on Stanford

Multimedia

• Read the SEC charge against Stanford in full

• BLOG: the fall of a billionaire

The Stanford Bank Venezuela issue a statement in an attempt to calm clients, saying that it had asked a bank regulator to join its board and stressing that its assets were not linked to the Stanford International Bank, a private offshore investment bank in Antigua that is at the heart of the fraud inquiry.
The central bank for the Eastern Caribbean pleaded with Bank of Antigua customers to remain calm, saying in a statement that although many depositors had started to withdraw funds, “causing some anxiety,” the bank had sufficient reserves.
“However, if individuals persist in rushing to the bank in a panic, they will precipitate the very situation that we are all trying to avoid,” the central bank warned.
Antigua’s Prime Minister, Baldwin Spencer, said in a televised address to the nation late last night that the charges against Stanford could have “catastrophic” consequences for the nation, but he urged the public not to panic.
Mr Stanford owns the country’s largest newspaper, heads a local commercial bank, is the biggest private employer and its top investor, and is the first American to receive a knighthood from its government. He has homes sprinkled across the region, from Antigua to St Croix in the U.S. Virgin Islands to Miami.
“I’m worried and I’d like to get my money out,” said Andrea Lamar, 28, who joined the queue outside a branch on a tourist boulevard in the Antiguan state capital, St. John’s.
A woman in the queue who declined to give her name said: “I wasn’t panicked until I saw this crowd. Now I’m concerned.”
The panic took hold after the US Securities and Exchange Commission (SEC) lodged 25 pages of allegations with a court in Detroit yesterday, detailing a $9.2 billion fraud allegedly perpetrated by Mr Stanford and three companies he controls.
http://www.timesonline.co.uk/tol/new...cle5760612.ece

[Sir X]

Allen Stanford's own lawyer 'blew whistle on $9.2bn fraud'




Jenny Booth


div#related-article-links p a, div#related-article-links p a:visited {color:#06c;}One of Allen Stanford's own lawyers has emerged as the key figure who prompted regulators to take action over an alleged $9.2 billion fraud against the flamboyant Texan billionaire who sponsored a $1 million-a-man cricket match.
The US Securities and Exchange Commission lodged a civil suit against Mr Stanford and his Stanford Financial Group last night, claiming that it was investigating "a fraud of shocking magnitude that has spread its tentacles round the world".
The news is a stunning blow for the England and Wales Cricket Board and its chairman, Giles Clarke, who signed a controversial, five-year sponsorship deal worth $100 million (about £70.2 million) with Mr Stanford in a glitzy ceremony at Lord's last summer.
The SEC's inquiry into the improbably high rates of return on Mr Stanford's investment products had been running since last July, but according to the Bloomberg news agency the turning point came last week, when a lawyer for Stanford International Bank (SIB) in Antigua informed the SEC that he wanted to withdraw all the evidence he had given so far.
Related Links

• Texan tycoon charged over $9.2billion 'fraud'

• Clarke stands firm on Stanford

• Cricket bosses get what they deserve

Multimedia

• BLOG: the fall of a billionaire

• Read the SEC charge against Stanford in full

"The attorney's withdrawal is a massive red flag that screams fraud," said Peter Henning, who teaches criminal and securities law at Wayne State University in Detroit.
"If the SEC hadn't turned up the heat by that point, it did then."
Bloomberg said that a source familiar with the case named the lawyer as Thomas Sjoblom , of Proskauer Rose LLP. Mr Sjoblom is an expert in financial fraud who worked for the SEC for 20 years before joining Proskauer Rose in 1999.
He has refused to comment, and last night Brian Bertsch, Mr Stanford's spokesman, was referring all questions about the case to the SEC. Mr Stanford has denied any wrongdoing.
Analysts have raised concerns that SIB was audited, not by PricewaterhouseCoopers or KPMG, which both have large branches in Antigua, but by a small local firm called CAS Hewlett, whose chief executive, Charlesworth Shelly Hewlett, died last month.
A Financial Times journalist who visited Hewlett's offices yesterday reported that the company seemed to occupy just two rooms on the top floor, and there was a typewriter on its dusty reception desk. Employees said that since Mr Hewlett's death, operations were being handled by Mr Hewlett's daughter Celia, who is based in Enfield, North London. She has not responded to requests for comment.
Last night, as investors arrived in Antigua to rap on the door of SIB demanding to know the whereabouts of $8 billion in certificates of deposit – a further $1.2 billion invested in a mutual fund wrap programme is also implicated – Mr Stanford’s own whereabouts were not immediately known.
A dual US-Antiguan citizen, he reportedly spends fewer than 90 days a year in the United States for tax purposes, and has a number of homes from Antigua to St Croix in the US Virgin Islands and Miami. He was given a Commonwealth knighthood by Antigua.

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http://www.timesonline.co.uk/tol/new...cle5758200.ece

[Gamma]

ok but GBP400k is a drop in the bucket of a 9 billion fraud....

[Me]

The $8 billion thing is more media hype than anything. The man collect it by being dishonest about past performance and about the securities they are invetsing in. Once they get deeper into the investigations we probably hear more about the actual losses.

The other thing is that the way his company is setup they are pretty much independent entities and most of his operations don't have anything to do with the others. Due to the media hype, they will feel the heat and probably be unable to withstand the run that will be coming.

[Peter R]

Shouldn't that be...Bernard Madeoff with the money?