Archive for June 20th, 2009

Allen Stanford and others indicted in the US

June 20, 2009

Yesterday, the SEC finally charged Allen Stanford for his role in the supposed Ponzi scheme and he surrundered to the authorities in the afternoon. The SEC also charged others in the case including the financial regulator of Antigua where Stanford Intrenational bank was based.

You can read the full complaint to the Court here.

The SEC named as defendants Allen Stanford, James Davis who was the CFO of the Stanford Group, Laura Pendergest-Holt who was the Chief Investment Office of the Group, Gilberto Lopez and Mark Kuhrt, Chief accountant and global Comptroller for the Group and Leroy King, the Head of Antigua’s financial regulator.

The SEC accuses Stanford of fraud in the sale of the CD’s and the description which was made of their investment philosohpy. He is also accused of using the money from the deposits for his personal use.

Including a foreign regulator in the indictment was quite surprising and unusual. The SEC accuses King of receiving bribes and perks from Stanford in exchange for obstructing the SEC’s investigations and not auditing the books of Stanford International Bank. He is even accused of sending the SEC a letter dictated by Stanford.

The SEC also charges that Stanford’s mutual fund program was fraudulent, with funds picked after the fact to tout the program’s retuns.

It took a few months but the SEC finally went after Stanford who is now in jail, but the proceedings are certain to be long and drawn out with charges and countercharges.

Stay tuned…