Well, this is quite interesting:
Stopping what it called a “massive ongoing fraud,” the Securities and Exchange Commission on Tuesday accused Robert Allen Stanford, the chief of the Stanford Financial Group, of fraud in the sale of about $8 billion of high-yielding certificates of deposit held in the firm’s bank in Antigua. Also named in the suit were two other executives and some affiliates of the financial group.
In the complaint, filed in Federal District Court in Dallas, the S.E.C. accused Mr. Stanford and two associates — James M. Davis, a director and chief financial officer of Stanford Group and the Antigua-based bank affiliate, and Laura Pendergest-Holt, the chief investment officer of both organizations — with misrepresenting the safety and liquidity of the uninsured CDs.
The CDs were sold by Stanford International Bank through the firm’s registered broker-dealer and investment adviser, which are in Houston. Both the bank, which claims $8.5 billion in assets and 30,000 clients in 131 countries, and the brokerage unit, which operates about 30 offices in the United States, were named in the S.E.C. suit. Stanford Financial asserts that it advises about $50 billion in assets.
Shortly after 10 a.m. Central time, about 40 police officers and other law enforcement officials simultaneously entered Stanford Group’s two office buildings in Houston. Many of the law enforcement personnel carried large black briefcases. Stanford group’s headquarters are in two offices in Houston, one within a tower of the Houston Galleria shopping mall, and the other across the street.
A spokesman for Stanford Group declined to comment.
It is amazing how a major meltdown in the markets will expose the frauds.
Vox Day Snarks:
What, there was something fishy about high-yield Antiguan CDs? Really? What will shock us next, the discovery that the import/export firm with the branch office in Medellin is selling coke?
Heh.
While I think it is alright to have a sense of humor about it. One must realize that there most likely some people “taking a bath” right about now. So, I shall keep the giggles to a minimum. Who I feel mot sorry for, are the peole who trusted these companies to invest thier money properly, and have gotten horribly screwed over. Those are the one’s I feel for.