Tuesday, 29 November 2011

Allen Stanford Mental Fitness Hearing Scheduled for Dec. 20

By Andrew Harris and Laurel Brubaker Calkins

Nov. 29 (Bloomberg) -- R. Allen Stanford, the Texas financier accused of leading a $7 billion investment fraud, faces a Dec. 20 hearing to determine whether he is mentally fit to stand trial next year.

Stanford, 61, returned to Houston earlier this month after a nearly nine-month stay at a U.S. Bureau of Prisons hospital at Butner, North Carolina. He was treated there for a dependency on anti-anxiety drugs given to him in prison and evaluated for the after-effects of a head injury sustained in a jailhouse assault.

Houston U.S. District Judge David Hittner today scheduled the competency hearing to determine if Stanford can assist in his defense. In a separate order, the judge said Stanford’s criminal trial would start with jury selection on Jan. 23.

The former chairman and chief executive officer of Houston- based Stanford Group Co. is accused of misleading investors about the nature and oversight of certificates of deposit issued by his Antigua-based Stanford International Bank Ltd.

Stanford, who maintains his innocence, has been in custody since June 2009, when he was indicted by a federal grand jury in Houston. The court has twice postponed previously scheduled trial dates.

Aiding Defense

Ali Fazel, one of his defense attorneys, today declined to comment on the hearing and trial dates, citing an earlier order from Hittner barring attorneys from discussing the case publicly.

Justice Department spokeswoman Laura Sweeney didn’t immediately respond to a request for comment on the trial date. She has previously declined to comment because of the gag order.

If he’s found unable to help his attorneys prepare his defense, Stanford could return to Butner for further treatment, said Eric Sussman, a former federal prosecutor now in private practice in Chicago, in an interview earlier this month.

If Hittner finds Stanford can’t sufficiently recover his faculties, the judge would be required to decide whether the financier must be committed to a long-term care facility, said Sussman, now a partner in the Chicago office of New York-based Kaye Scholer LLP.

For Stanford to be permanently institutionalized, “he’d have to be deemed a danger to himself or others,” said Sussman, who isn’t involved in the case. “To the extent the judge finds he can’t be restored to competency, they may have to drop the charges,” he said.


Houston attorney Wendell Odom, who convinced a jury that Andrea Yates was insane when she drowned her children, said if the government’s doctors have found Stanford fit for trial, it will be difficult for the defense to prove otherwise. Stanford will have an even tougher time proving he’s so permanently incapacitated that he can never be tried, Odom said.

“Mental competency is an incredibly low standard, not the same as insanity,” said Odom, a former federal prosecutor. “It basically means you are cognizant of what’s going on and you can talk to your attorney.”

The case is U.S. v. Stanford, 09cr342, U.S. District Court, Southern District of Texas (Houston).

Monday, 28 November 2011

Stanford Still Not Competent for Ponzi Trial - Lawyer

Source: Scott Cohn (CNBC)

Despite nine months of court-ordered drug treatment, accused Ponzi schemer Allen Stanford is not yet competent to face charges he ran a $7 billion Ponzi scheme, his attorney told CNBC.

As a result, thousands of Stanford investors remain in limbo, nearly three years after the alleged scheme was exposed.

Stanford, who was released from a prison medical center earlier this month but remains in federal custody, was scheduled to be arraigned today on revised charges filed in May. But defense attorney Ali Fazel said in an e-mail that Stanford cannot be arraigned "until his competency status changes."

As a result, today's arraignment has been postponed.

In January, U.S. District Judge David Hittner ruled Stanford incompetent to stand trial after the 61-year-old financier became addicted to prescription drugs while in federal custody. Doctors testified that Stanford may also have suffered brain damage after being severely beaten by another inmate in 2009. Hittner ordered Stanford to undergo drug treatment at the Bureau of Prisons medical center in Butner, NC. With the treatment apparently completed earlier this month, Stanford was moved back to a federal detention in Houston. Because Hittner ruled he is a flight risk, Stanford is being held without bail pending his trial.

When that trial will take place remains uncertain. It is currently scheduled to begin January 20 according to a source close to the case, but questions about Stanford's competency would appear to make that date increasingly unlikely.

Specifics of Stanford's condition are difficult to come by in a case that is shrouded in an unusual amount of secrecy.

Earlier this month, a civil attorney for Stanford, Stephen Cochell, said in a court filing that his client "continues to suffer from short-term and long-term memory loss." That filing — despite being in a different court and a separate case — drew an angry rebuke from Hittner, who barred Cochell from further contact with his client in the civil case until after the criminal case is complete.

Attorneys in the criminal case are barred from discussing Stanford's condition under a broad gag order imposed by Hittner, who has also sealed much of the court docket since Stanford's medical problems came to light.

As a result, more than 28,000 investors remain in the dark. A court-appointed receiver attempting to recover assets has said much of that effort depends on the outcome of Stanford's criminal trial, since the vast majority of the funds are in foreign accounts that are inaccessible without a resolution in the case.

So far, investors have recovered just pennies on the dollar.

Thursday, 24 November 2011

Westgate victims still waiting payment a year after Ponzi Schemer went to Prison

Some of you may find this interesting. Just to give you all an idea of how long we may have to wait for any pay-out - once payments have been agreed and once Janvey has got his act together. Read this article and you will see why I am pushing for Grant Thornton to get access to the funds in Canada, Switzerland and the UK. If GT handle this, we will have direct access to them and can push for a speedy pay-out. That aside, we have Richard and 6 other victims on the committee who will make sure that any payment is swift and fair. If the money falls into the hands of Janvey and the committee we will be waiting forever to see a penny of it.

Westgate victims still waiting payment a year
after Ponzi schemer went to prison

A year ago today, a federal judge sent James Nicholson away to prison for 40 years for running a $140 million Ponzi scheme. Attorneys and forensic accountants who helped recover investors' money have been paid, but the investors who entrusted their money to the former Saddle River hedge fund manager have yet to get back a penny.

Why the holdup? The federal government refuses to say. "You can't get an answer," said Jon Prusmack, a Rockland County businessman who along with his wife lost $13.2 million in the fraud, the second-largest amount lost of Westgate's nearly 400 investors. He's among the investors who have been prodding government officials for answers. "We get a lot of
smokescreen," he said. Nicholson's victims continue to complain of vague, noncommittal answers from the U.S. Attorney's Office in Manhattan, while estimated payment dates keep getting pushed back without explanation.
The U.S. Attorney's Office had previously told The Record it is "committed" to ensuring victims to what they're "entitled to" but did not say when the funds would be distributed. The clerk of court for the U.S. District Court, Southern District of New York, in Manhattan, which the U.S. Attorney's Office said would distribute the funds, would not respond to multiple requests over the phone and in writing. The clerk, Ruby Krajick, didn't respond to requests through a spokeswoman or a requested written inquiry. A call to U.S. District Judge Richard Sullivan, who sentenced Nicholson, went unreturned. Since July, six payments of Westgate investors' money — totalling $19.6 million — have trickled into
Sullivan's court, where Nicholson was prosecuted, pleaded guilty and was sentenced. That money could be earning interest in investors' bank accounts, or paying for living expenses, retirement or college

In Prusmack's case, the roughly $2 million he expects to get back from his Westgate losses could fund operations of two of his health and wellness, and sports and entertainment, businesses. "Rather than go borrow money, I'd rather use this," he said. Prusmack isn't facing the financial hardship experienced by other Westgate investors who have been struggling to make ends meet. "I just feel sorry for the other people," he said.

Howard Hellman, a Rockland County businessman who invested in Westgate after meeting an employee of the fund at the Church of the Presentation in Upper Saddle River, would like the government to return
his money, too. "As one of the investors, it's almost like a double whammy," Hellman said. "I do understand there's a process, but it's frustrating that the process is taking as long as it's taking." Victims of other recent Ponzi schemes have also had lengthy waits to get back their money.

A bankruptcy trustee in Bernard Madoff's case just sent out the first checks with investors' recovered funds earlier this month. Madoff was sentenced to 150 years in prison in June 2009. Investors in Texas financier R. Allen Stanford's alleged Ponzi scheme have yet to receive any
distributions of recovered funds, according to a trustee in that case. Stanford was indicted in June 2009
and his case continues.

E-mail: tangel@northjersey.com

Wednesday, 23 November 2011

Congressional Letter to SIPC Chairman Orlan Johnson

Below is a Congresional letter that has been sent to the SIPC Chairman Orlan Johnson.
I would advise ALL International victims to read this and take note that the letter speaks directly about “the victims in our States” and “the American people”, NO mention of International Victims!!

There is also a reference to Ralph Janvey as “an overzealous and careless court appointed receiver”.

Congressional Letter to SIPC Chairman

Tuesday, 22 November 2011

Stanford arraignment set for Nov 28th

Source: Tex Parte Blog
Judge David Hittner: Stephen Cochell, who represents R. Allen Stanford in civil suit, can’t have in-person access to his client until criminal case is completed.

Posted on November 18, 2011

Houston financier R. Allen Stanford is back in Texas and back at the Federal Detention Center in Houston, according to Federal Bureau of Prisons records. But proximity doesn’t do much good for Stephen Cochell, an attorney in Houston who represents Stanford in a civil suit, Securities and Exchange Commission v. Stanford International Bank Ltd, et al., which is pending in the U.S. District Court for the Northern District of Texas.

On Nov. 17, Senior U.S. District Judge David Hittner of the Southern District of Texas, who is presiding over Stanford’s criminal case, signed an order precluding Cochell from “in-person access” to Stanford at the FDC in Houston until Stanford’s criminal case is “completed.” Hittner wrote that it has come to his attention that Cochell issued a public statement concerning Stanford’s “current mental status” that could “directly impact the on-going criminal prosecution and impending jury trial” against Stanford in his court.

Hittner wrote that Cochell, in the statement, said Stanford “continues to suffer from short-term and long-term memory loss” and should remain at the federal medical facility in Butner, N.C., through the end of January 2012. Stanford recently returned to Houston after undergoing treatment in Butner for a dependency on prescription drugs. Cochell, of the Cochell Law Firm, declines comment. Stanford’s criminal-defense attorneys, Robert Scardino and Ali Fazel, partners in Scardino & Fazel in Houston, did not immediately return a telephone message left at their office.

Stanford’s criminal trial was set for January, but Hittner delayed it after finding Stanford was mentally incompetent to stand trial. On May 4, the government filed a superseding indictment against Stanford, and his arraignment is set for Nov. 28 before U.S. Magistrate Judge Mary Milloy of the Southern District of Texas.

Stanford pleaded not guilty to the charges in his original indictment of June 2009. He faces a total of 14 counts: one count of conspiracy to commit wire fraud and mail fraud; five counts of wire fraud; five counts of mail fraud; one count of conspiracy to obstruct an SEC investigation; one count of obstruction of an SEC investigation; and one count of conspiracy to commit money laundering.

How Many Members does SVC Actually Represent Continued

It seems the SVC has become acutely aware their claim to representing 4000 victims is in question. After a year or more of being ignored victims have miraculously started receiving emails from Angela, unfortunately its to little to late as can be seen by the comments from the victims.

Senior Member
Mon 21 Nov

I received the following message from Angela since it went on the blog. The first I have heard from her this year. I wonder how many more have had their membership revoked, for what reasons, and whether the numbers she claims reflect the SVC's reduced status.

I have received notification you did not receive notice that your membership in the Stanford Victims Coalition had been revoked. The SVC reserves the right to revoke membership at any time, without notification.

Senior member
Tues Nov 22

I also just received an Email from Angela, here is my reply:

Hi Angela,
with all respect I would like to remind you that I do not belong to the Stanford Victims Coalition since 2 years ago.
I do not receive any SVC-Newsletter since 2 years ago, and I remember you have sent an Email more than 1 year ago writting that you will represent only the us-victims.

If you would like to send some information under the name of the "Stanford Investors Committee", then you are welcome to do it but please not under the name of "Stanford Victims Coalition".

P.S. when you say that you represent 4.000 international victim, I hope my name is not included there; otherwise please say "3.999 international victim"
Thank you!

Junior Member
Tue Nov 22

Yes .....strange isn't it
I also received the email yesterday after about 18 months silence

Junior Member
Tue Nov 22

The same happened to me. I replied in the same way as other member did it. Everybody must reply to her like was done above.
I dont trust anymore the Committee and of course neither Janvey. What about Little? He never did his job, he is only getting a check every end-month!

Junior Member
Tue Nov 22

I am really without words...
I have the same situation like all you.

Senior Member
Tue Nov 22

I've gotten, few hours ago, the same SVC e-mail.
I wonder I'm eligible now for SIPC, along with ALL the victims, worldwide

Junior Member
Tue Nov 22

I also received the email from Angela including the letter sent to the DOJ as an attachment. The last time I received an update from her was back in January this year, explaining how to file the claim against the SEC.

Junior Member
Tue Nov 22

I have received the same mail in February on this year, from angela, and yesterdey the same as everybody did.

Senior Member
Sun Nov 27

She excluded me from her mailing list a long time ago - even though she got substantial amounts of money from me for her efforts- As she mentioned to me from day one when she stared all this was :
She did not want international victims to get a penny - her campaign was only directed to help a few and mostly for her family. Her excuse was that the USA government would not feel good about paying to foreign investors 7 Billion - Therefore, she was pressing only for a few under a very limited spectrum – Such as Brokerage accounts in Houston only – as she has 8 accounts each one for $500,000 opened in Houston - feel sorry she lost that money but, I also lost $1.5 million in only one account.
I am not member of SVC which such low moral standards and I qualify equaly for SIPC regardless
Article by Stanfords Nemesis

Monday, 21 November 2011

December 7, 2011 Webinar Invite

Stanford International Bank, Ltd. (In Liquidation) - Invitation to Online Presentation for the creditors/victims on December 7 at 11:00 a.m. EST

English invite
Dear Creditors/Victims -

The Joint Liquidators of Stanford International Bank, Ltd. invite you to attend their 2nd online presentation:

  • LIVE Webinar featuring joint liquidators Marcus Wide & Hugh Dickson – The Joint Liquidators will be updating creditors/victims about the current status of the liquidation and responding to questions from creditors/victims who will have the opportunity to send in questions during the presentation.
  • Wednesday, December 7 at 11:00 a.m. EDT – presentation is expected to last approximately 1 hour.
  • Register today – limited spaces available - Please visit Webinar Invite to complete registration. There is no cost for you to attend this presentation.
  • Please log-in to Webinar 10 minutes prior to start time.
  • You will also have the option of listening to the presentation in Spanish.

If you are unable to listen to the presentation on Wednesday, December 7 please note that the presentation will also be posted to the liquidation website(http://www.sibliquidation.com/)approximately 24 hours after the conclusion of the presentation.

Spanish invite
Estimados Acreedores/Víctimas:

Los Liquidadores Conjuntos de Stanford International Bank, Ltd. lo invitan a que participen en la segunda presentación en línea:

  • Webinar en vivo con los Liquidadores Conjuntos Marcus Wide y Hugh Dickson - Los Liquidadores Conjuntos actualizaran a los acreedores/víctimas sobre el estado actual de la liquidación y responderán a preguntas de los acreedores/víctimas, quienes tendrán la oportunidad de enviar sus preguntas durante la presentación.
  • Miércoles 7 de Diciembre a las 11:00 am EST - la presentación se espera que dure aproximadamente una hora.
  • Regístrate hoy - Plazas limitadas - Por favor, visite: Webinar Invite para completar el formulario de registro. No hay ningún costo para que usted pueda participar en esta presentación.
  • Por favor inicie la sesión del Webinar 10 minutos antes de la hora de inicio.

Usted también tendrá la opción de escuchar la presentación en Español.Si usted no tiene la oportunidad de escuchar la presentación el Miércoles 7 de Diciembre, por favor tenga en cuenta que la presentación también estará disponible en nuestra página web (www.sibliquidation.com) aproximadamente 24 horas después de la conclusión de la presentación.

How Many Members does SVC Actually Represent?

One of the reasons Judge Godbey cited for denying the Motion to Intervene is that the Stanford Victims Coalition claims to represent 4,000 members in 50 countries.

As an investor who once joined the SVC forum, and hence became an SVC member, I have not been informed by the SVC I am no longer a member, yet have received no communications from the SVC for at least 18 months.

How many more of us are there who joined the SVC via it's forum but have been effectively dis-communicated?

If there are any other SVC members who have not received regular communications for some considerable time, please reply to this thread on the Stanford Victims Forum at: http://svg.creatuforo.com/ or post your name in the comments section here on the blog.

Please take the time to respond as it may be important.


Senior member
Posted: Thu Nov 17, 2011 5:15 pm

Hi Richard
Like you I was an SVC member, and have not heard from them for a long time.

Senior Member
Posted Nov 17, 2011

I also joined the SVC long time ago and I'm thinking seriously I'm still a member of it. Never have been informed the contrary by dear Angel

The Admin Stanford International Victims Forum
Fri 18th Nov:

I also was a member of SVC. However I dont receive any newsletter since almost 2 years ago.

Anyway, there is an Email from Angela where she wrote she does not represent any longer the international victims...

Please do not forget that in the old Forum there was plenty of SPAM done by "registered members". Those members were never deleted, therefore the number of "registered members" in the old forum grow up until reach more than 4.000 "members". There you have the so called by Angela: "Representation of more than 4.000 victims"

We need to stop all this lies and manipulation!

Posted: Fri Nov 18, 2011 10:16 pm

I was also a SVC member. When the forum was "desactivated" Angela stopped sending the bulletins by email or any information . Definitely I am clear she and SVC doesn't represent me. I also wrote to her a letter asking for answers, I am still waiting for a response. I have the feeling that we were useful for her original purposes and now we are disposables.


Junior member
Posted: Sat Nov 19, 2011 4:19 am

I can write the same. I did not receive any response from Angela, Mr. Little (suppose to keep the victims informed), nor Dr. Peter.

The old forum was shut down to keep most of the victim outside any discussion or information; in that way "they" can do whatever they want for their own benefit.

Junior member
Posted: Sat Nov 19, 2011 2:00 pm

Afternoon Everyone
Yes we are also in the same position. Joined at the very beginning but have received no communication for at least 18 months


Junior member
Posted: Mon Nov 21, 2011 7:45 am

Also a member of SVC but no newlsetters for around 18 months ..... and I had previously made a donation to the group towards an open letter in a USA newspaper.

I guess I am not surprised by Shaw's actions. I have learned a lot about human behaviour in the last few years.

Senior member
Posts: 663
Posted: Thu Nov 17, 2011 10:32 pm

Count me in, Angela decided a long time ago that she did not want me to know what she was doing.

And this is why we need signatures on the petition, to show we are not just one or two disgruntled victims (as Judge Godbey said) but that there are hundreds of us and that we have been ignored and disenfranchised by Angela and the committee.


Stanfords Nemesis
Senior member
Posted: Mon Nov 21, 2011

Count me in, I also seen to be persona non grata. Have not received anything from SVC for nearly 2 years. Guess we were all taken for a ride by Angela to make up the numbers so she could “appear” to be representing many when in fact she represented few. Once on the committee her true motives came out and she sent the letter saying she would only represent the Americans. Why am I not surprised?

Saturday, 19 November 2011

Stanford Investors Granted Discovery In Cort Lawsuit

Source: Caribarena

Antigua St John's - US District Court Judge David Godbey has granted the Official Stanford Investors Committee’s motion to conduct jurisdictional discovery for Cort & Cort and Cort & Associates,

in connection with the February lawsuit alleging the law firms received more than $1.1 M in fraudulently transferred Stanford International Bank (“SIB”) customer funds.

Judge Godbey said in the order that the Investors Committee has made a “preliminary showing for jurisdiction” for the allegations, and granted a four-month period for discovery.

“Dr Errol Cort’s deposition will be a critical component of the discovery Judge Godbey authorized today,” said Peter D Morgenstern, a lawyer serving on the Committee who also filed a class-action lawsuit against the government of Antigua & Barbuda in the same District Court in 2009.

He said, “Dr Cort’s law firm was literally on Stanford’s payroll for an extensive period of time, and the firm also served as the official agent for Stanford International Bank, while Dr Cort was the nation’s minister of Finance.

We are very pleased with Judge Godbey’s decision.”

New Libyan Government Wants Its Stanford Money Back

Source: Scot Cohn (CNBC)

With the global financial crisis bearing down on him in late-January, 2009, financier Allen Stanford travelled to Libya in search of a lifeline—money from the Gaddafi regime, whose sovereign wealth funds had been investing with Stanford for some time.

It was already too late for Stanford, whose financial empire was shut down three weeks later by the Securities and Exchange Commission, which called it a massive $8 billion Ponzi scheme.

But somehow the Libyans managed to withdraw some $55 million of their Stanford investments just before the company collapsed.

A court-appointed receiver rounding up Stanford's assets, Dallas attorney Ralph Janvey, says that money belongs to Stanford investors, since it represents returns on their investments. Janvey won a temporary injunction in June, essentially freezing the money.

Now, with a hearing on that injunction scheduled for next month, the new Libyan government says the Libyan people were victims of the Stanford fraud, too, and they want the $55 million back.

Libya's new government, the Transitional National Council, has hired two powerful Washington law firms—Patton Boggs and Shearman & Sterling—to fight the injunction.

In court papers filed this week, the TNC denies the proceeds the Libyan sovereign wealth funds received came from the alleged Ponzi scheme, and said one of the funds, the Libyan Foreign Investment Corporation, appears to be a "major victim" of the alleged Stanford fraud.

The battle is yet another potential complication for Stanford's 28,000 retail investors, who so far have recovered just pennies on the dollar.

In addition to the battle over the Libyan millions, there are hundreds of millions more in limbo depending on the outcome of Stanford's criminal trial, currently scheduled for January.

Separately, the Securities Investor Protection Corporation has still not decided whether to grant insurance coverage to Stanford's investors, which would clear the way for payments of up to $500,000 per account.

Stanford has denied wrongdoing.

Friday, 18 November 2011

Receivers motion to establish bar date for claims

1474 Receiver Motion to Establish Bar Date for Claims

Thursday, 17 November 2011

Letter from Gaytri kicks Receiver into Action

Gaytri sent a letter out to Janvey demanding that he make a payout and today this has happened!! This is a direct result of our Motion to Intervene, well done Gaytri!!
You can find Gaytri's letter in the previous post on this page.

Source: Bloomberg

Allen Stanford Receivership Proposes Payment Plan for Defrauded Investors
By Andrew Harris and Laurel Brubaker Calkins - Nov 17, 2011

The court-appointed receiver for R. Allen Stanford asked a U.S. judge to approve a proposed plan to register, and ultimately pay, claims by investors allegedly defrauded in a $7 billion scheme.

Lawyers for receiver Ralph Janvey didn’t say in yesterday’s filing how much money is available to distribute to claimants. On Nov. 11, the receivership submitted to U.S. District Judge David Godbey in Dallas a report stating it had $114.5 million in cash on hand and $96.6 million in assets as of Oct. 31.

“The receiver has not decided which methodology is best suited for the circumstances of this case,” Janvey’s lawyers told the court. “For investor claimants, the amount of the investor’s net investment in the Ponzi scheme will be one of the most significant factors.”

Janvey was appointed by the court in February 2009 when the U.S. Securities and Exchange Commission sued Stanford, claiming he deceived those who bought certificates of deposit from his Antigua-based Stanford International Bank Ltd.

Janvey said in a court filing that he may be able to increase the amount available for distribution by an additional $955.3 million if he succeeds in the so-called clawback litigation and wins access to Stanford’s foreign bank accounts. Janvey has sued Stanford investors and vendors for $609.7 million. He’s also fighting the Antiguan receiver for control of $335 million in Stanford’s Swiss and British bank accounts.

Stanford, 61, was indicted for fraud by a U.S. grand jury in Houston in June 2009. The former principal of Houston-based Stanford Group Co. has been in federal custody since then and has pleaded not guilty.

The receiver asked Godbey to approve an order setting a bar date and compelling investors to provide proof of their claims and divulge whether they’d also sought payment from a receivership appointed by the Antiguan government.

Separate Response
Janvey’s lawyers said the proposal was assembled after consultation with an investors’ committee and a court-appointed investor advocate, Dallas attorney John Little.

They didn’t fully agree with his proposal, attorneys for the receivership said, and are expected to file separate responses with the court.

“Ultimate payment on any claims will take into account payments, if any, made pursuant to distribution plans, which may be implemented by relevant constituencies” including the U.S. Justice Department, the federal Securities Investor Protection Corp. and foreign courts and authorities, according to the Janvey filing.

The Janvey receivership through Oct. 31 consumed $52.1 million in professional fees and expenses, and an additional $50.3 million in other expenses, according to the Nov. 11 report.

‘About Time’
“It’s about time,” Stephen Malouf, a Dallas attorney who represents more than 480 Stanford investors, said in a phone interview. “For a lot of the investors, this was their life savings. There could’ve been a pro-rata distribution a year or 18 months ago.”

“If the receiver has a system to register claims, the investors have their proof and there’s money in the till, then you should make some kind of distribution,” the investors’ lawyer said.

The civil case is Securities and Exchange Commission v. Stanford International Bank Ltd., 09cv298, U.S. District Court, Northern District of Texas (Dallas). The criminal case is U.S. v. Stanford, 09cr342, U.S. District Court, Southern District of Texas (Houston).

KLS Letter to Receiver and Examiner

KLS Ltr to Receive and Examiner 11-16-11

Tuesday, 15 November 2011

Central Bank relinquishes control of ECAB

Source: Observer News

The Eastern Caribbean Central Bank (ECCB) has relinquished control of the Eastern Caribbean Amalgamated Bank (ECAB), formerly Bank of Antigua after more than two years.

The ECCB intervened in February 2009 after a run on the indigenous bank by depositors threatened its stability and that of the entire Eastern Caribbean Currency Union.

The central bank said at that time it had taken the step after “an unusual and substantial withdrawal of funds.”

This came on the heels of the indictment of former owner Allen Stanford who is accused of masterminding a seven billion US dollar Ponzi scheme.

Some of the Bank’s assets were used by the Eastern Caribbean Amalgamated Bank (ECAB) which began operating in October 2010.

ECAB comprises five of the largest regional banks across the currency union.

In a notice in Saturday’s Daily OBSERVER newspaper, ECCB Deputy Governor Trevor Brathwaite stated that it had relinquished control of the bank effective November 11, 2011.

The statement read: “The Central Bank shall relinquish control of the Bank and shall not continue to carry on the business of the bank where it has sold or otherwise disposed of the property, assets and undertakings of the Bank.”

The official said this indicates a successful transition from the troubled entity to ECAB.

It was further stated that a receiver would continue to manage and liquidate the remaining assets and liabilities of Bank of Antigua.

Does SEC Discipline Make Up for Failures in Ponzi Scheme Investigations?


The Washington Post reported on Friday that the Securities and Exchange Commission (SEC) has disciplined eight employees for failing to crack down on Bernard Madoff's multi-billion dollar Ponzi Scheme despite receiving multiple tips indicating that Madoff was cheating investors.

We are pleased to see the SEC finally taking action more than two years after the Office of Inspector General (OIG) issued an exhaustive report detailing the agency's failures since 1992 to follow up on evidence pointing to Madoff’s scheme. But will the discipline be enough to satisfy the agency’s critics and defrauded Madoff investors? And how does it compare with the SEC’s response to other disciplinary recommendations issued by the OIG?

The Post reported that eight employees were subject to disciplinary action that included suspensions, pay cuts, and demotions. A document obtained by the Post showed that the employees included an enforcement manager, a senior officer in the agency’s inspections office, and staff attorneys. An outside law firm, along with the SEC’s head of human resources, had recommended firing one of the employees, but SEC Chairman Mary Schapiro decided that doing so “would harm the agency’s work,” according to an SEC spokesman. That employee received a 30-day suspension along with a reduction in pay and grade.

In its 2009 report, the OIG questioned the performance of 21 of the 56 SEC employees it examined who worked on the Madoff probe. The OIG concluded that “a thorough and competent investigation or examination was never performed” even though the SEC “received more than ample information in the form of detailed and substantive complaints over the years.”

An SEC official recently told Congress that 35 of these employees had left the agency voluntarily, including some who ended up at high-paying jobs in the private sector. Another employee who was a “key participant” in the Madoff probe received a $1,200 cash award that was partly related to his or her work on a follow-up investigation of Madoff. The SEC still has not fired anyone for mistakes related to the Madoff case.

House Oversight and Government Reform Committee Chairman Darrell Issa (R-CA) stated that “[a]fter all the talk about ethics and cleaning up the SEC, the entire Madoff scandal continues to place serious doubt on claims of meaningful progress.”

At a hearing earlier this year, Chairman Schapiro told Congress that the SEC employees who worked on the Madoff case “aren’t bad people. In some cases they were people who were very junior and not adequately trained or supervised.” She also noted that the SEC had to comply with civil service rules in deciding on the appropriate disciplinary action for these employees. In addition to disciplining individual employees, the SEC has also initiated a number of structural reforms to improve its investigation and examination processes in the aftermath of the Madoff debacle.

Earlier this year, POGO sent a letter to Chairman Schapiro raising concerns about the SEC’s recent handling of OIG disciplinary recommendations. Over a roughly two-year period, the OIG recommended disciplinary action for nearly 100 SEC employees, including 17 recommendations for disciplinary action “up to and including dismissal.” However, only 11 employees and contractors were terminated or removed from their contract during this period, according to SEC records provided to Chairman Issa. At least 16 employees resigned rather than facing any disciplinary action.

In addition to the Madoff case, the OIG also reported on the SEC’s failures to crack down on the Ponzi Scheme orchestrated by R. Allen Stanford. While this case may not have received as much media attention as the Madoff debacle, it also exposed serious problems at the SEC, including a failure to follow up on red flags uncovered by the agency’s own examinations staff. In a separate investigation, the OIG found that officials in the SEC’s Fort Worth office mistreated employees who raised concerns about a newly announced program that would have required staffers to waste their time on quick-hit, superficial examinations. (One of these employees, Julie Preuitt, had also raised red flags about Stanford’s scheme as early as 1997.)

Once again, the SEC has dragged its feet in responding to the OIG’s recommendations for disciplinary action stemming from these investigations. At a hearing last fall, SEC Enforcement Director Robert Khuzami told the Senate Banking Committee that the process for considering disciplinary action against the enforcement staff who mishandled the Stanford case was “fully under way.” In response to follow-up questions from the hearing, Rose Romero—one of the officials from the Fort Worth office who was cited by the OIG for taking retaliatory action against her staff—stated that some of the employees who worked on the investigation had actually received an award:

In recognition of their around-the-clock efforts and fortitude in overcoming efforts to obstruct the investigation by Stanford and his cronies, I nominated the attorneys, examiners and managers that completed the investigation for a “Director’s Award.” On my recommendation, Robert Khuzami, Director of the Division of Enforcement, issued the awards on July 1, 2010.

At a hearing earlier this year, it was revealed that a former Enforcement official in the Fort Worth office who did legal work for Stanford after leaving the agency is now the subject of a criminal inquiry by the Department of Justice. But other employees who participated in the bungled investigation have not been disciplined, in many cases because they voluntarily left the SEC.

The SEC also did not discipline Romero or Kimberly Garber, the two officials cited in the OIG report on whistleblower retaliation at the Fort Worth office. The Fort Worth Star-Telegram reported that the SEC declined to take disciplinary action because Garber and Romero had “cleared their moves with human resources,” and HR had no reason to retaliate against anyone. This explanation prompted a scathing letter from Senator Charles Grassley (R-IA), who pointed out that “such a policy would make a mockery of whistleblower protections throughout the government.”

Preuitt told Congress that “right after the report came out that there was retaliation against me, I understand that both the people that retaliated against me received a large bonus,” and that Garber was “put on the executive committee for the national exam program.” Both Romero and Garber stepped down this year without receiving any discipline.

In our letter to Chairman Schapiro earlier this year, we emphasized that it was important for the SEC to hold those who commit misconduct accountable and encourage whistleblowers to step forward:

[T]he SEC should be fostering an internal culture that promotes the detection of waste, fraud, and abuse, protects employees who blow the whistle, and holds employees and contractors fully accountable for their misconduct. Especially at a time when the SEC is encouraging outside whistleblowers to come forward with information on misconduct in the securities industry, it is more important than ever for the SEC to hold wrongdoers accountable within the agency.

Specifically, we recommended that the SEC implement OIG disciplinary recommendations in a timely fashion or explain in the public record why it disagrees with the OIG’s findings; make it a goal to release and post OIG investigative reports that are of public interest or have already been released through FOIA (for instance, the report on whistleblower retaliation at the Fort Worth is still nowhere to be found on the websites of the SEC or OIG); disclose any statutory provisions or agency rules that guide officials in determining what form of disciplinary action to take; and, when utilizing an alternative process for reviewing the OIG’s findings, take every possible step to ensure that the process is fair, transparent, and accountable.

Thursday, 10 November 2011

Allen Stanford Is Taken Out of North Carolina Prison Hospital

I have heard (but cannot confirm) that Stanford is due before the judge on 15th of this month for assessment, let's keep our fingers crossed that the judge can see through his tricks and deceit and this time the trial goes ahead in January.

Here is the latest report:

Source: By Laurel Brubaker Calkins

R. Allen Stanford, the indicted Texas financier, was transferred out of a prison hospital where he spent almost nine months being treated for a drug dependency acquired in jail and lingering effects from an inmate beating.

Stanford, 61, has been imprisoned as a flight risk since his June 2009 indictment on charges that he defrauded investors through an alleged Ponzi scheme built on sales of certificates of deposit sold by his Antigua-based Stanford International Bank.

U.S. District Judge David Hittner in Houston ordered Stanford into a prison rehabilitation program for treatment of a dependence on anxiety drugs prescribed to him in prison and for evaluation of effects from a head injury he received in a jailhouse assault in September 2009.

Stanford was treated at the hospital unit at the Federal Detention Center in Butner, North Carolina, since February. He is now in the federal prison transfer facility in Oklahoma City, according to the bureau’s website. He is being moved within days to the federal facility in Houston where he was previously locked up, according to a person familiar with the matter who declined to be identified because the judge barred people involved in the case from discussing it publicly.

His trial, which was originally scheduled for January 2011, hasn’t yet been rescheduled.

Stanford’s criminal-defense attorney, Ali Fazel, declined to comment on his client’s current location or mental state, citing Hittner’s order against publicly discussing some aspects of the case.

‘Back in Houston’

“Once he’s back in Houston, the next thing would be either a hearing or some sort of agreement between the parties that he is competent to stand trial,” Fazel said in a phone interview yesterday. “The judge has to find him competent” before a trial date can be set, Fazel said.

A lawyer representing Stanford in a related civil suit brought by the U.S. Securities and Exchange Commission had said Stanford should remain in the North Carolina facility through at least the end of January.

“Mr. Stanford still suffers from long-term and short-term memory loss as a result of his medical treatment,” Stephen Cochell, the civil attorney, said in a Sept. 27 filing in federal court in Dallas.

Cochell, in a phone interview yesterday, said he wasn’t notified of Stanford’s transfer from the North Carolina hospital unit or given access to the most recent reports by the prison’s doctors.

“I assume his doctors have submitted a supplemental report,” Cochell said. “I’ll get a chance to talk to him when he comes back.”

Wednesday, 9 November 2011

Allen Stanford Completes Drug Treatment?

Source: Scott Cohn (CNBC)

Accused Ponzi schemer Allen Stanford has been moved from the Bureau of Prisons medical center in North Carolina where he has been undergoing drug rehabilitation treatment since early this year, CNBC has learned.

That could be a signal that Stanford has completed his treatment, and may be ready to stand trial. Stanford, 61, faces 14 criminal counts in an alleged $7 billion Ponzi scheme. He has been held without bail since his indictment in 2009, but his trial was delayed after he became addicted to prescription drugs while in custody, and was ruled incompetent to stand trial.

His trial is currently scheduled for January, but it is unclear whether he would be ready for a trial by then. Stanford’s court-appointed attorney, Ali Fazel, was not immediately available for comment. Earlier this week, Fazel declined to discuss the timing of a trial, citing a court-imposed gag order in the case.

Covering Their Tracks: Firm Linked To Ponzi Scheme Erases Tagg Romney From Website

Source: Lee Fang (Think Progess)

Yesterday, ThinkProgress released our investigation of the Romney family’s investment firms, including Solamere Advisors and its parent company, Solamere Capital, which is run by Mitt Romney’s son Tagg. The report found that Tagg founded his firm using $10 million of Mitt’s money, and later partnered with a group of brokers who allegedly helped perpetrate one of the largest Ponzi schemes in modern history, the $8.5 billion Stanford Financial Group.

After our report, the Romney campaign released a statement to ABC News and the National Journal simply attacking ThinkProgress as a “a left-wing blog with a highly partisan agenda.” Despite calling our story “false material,” the Romney spokesperson did not directly dispute any of our assertions. The Romney campaign has not explained why, for instance, Tagg Romney falsely claimed that his Solamere Advisors partners were “cleared” of wrongdoing in connection to the Stanford Financial Group Ponzi scheme.

Now, it appears that one of the firms is trying to cover up its tracks. Sometime last night, Solamere Advisors, the firm run by brokers who allegedly took part in the Stanford Ponzi Scheme, deleted the section of their website that lists Tagg Romney and Spencer Zwick, the Romney for President lead fundraiser. View a screen shot of the current web address, which shows a “404 File or directory not found” error message:

Fortunately, ThinkProgress captured screen shots of the Romney family investment firm websites before we published our story. View a screen shot of the Solamere Advisors directors page before the deletion (click to enlarge the website image):

Solamere Advisors directors, including Tagg Romney, Spencer Zwick, and several brokers who allegedly perpetrated the Stanford Ponzi scheme

In an interview last month, Tagg Romney told ThinkProgress that his partners were “cleared” from the Stanford Ponzi scheme lawsuit to retrieve what prosecutors believe are the fraudulent gains made by his partners, Tim Bambauer, Deems May, and Brandon Phillips. He also suggested that his former Stanford employee partners were the true victims since they had been promised bonuses that they had never received. In fact, in court documents obtained by ThinkProgress, none of the men have been cleared, and a court-appointed audit found that they made about $1.6 million in participating in the Stanford Ponzi scheme.

Wednesday, 2 November 2011

MF Global liquidation pours more salt in Stanford victims’ wounds

Source: Loren Steffy (Chron.com)

MF Global, the international commodities trading firm run by former Goldman Sachs executive and New Jersey Gov. Jon Corzine, filed for bankruptcy Monday after a series of bad bets on European bonds. Within hours, the Securities Investor Protection Corp. swooped in, filing an application in federal court to appoint a trustee and calling for the firm to be liquidated to protect investors.

In making the filing, SIPC chairman Orlan Johnson said:

When the customers of a failed SIPC member brokerage firm have left their securities in the custody of that firm, SIPC acts as quickly as possible to protect those customers. In this case, SIPC initiated the liquidation proceeding within hours of being notified by the [Securities and Exchange Commission] that a SIPC case was necessary to protect the investing public.

Which all sounds very speedy and efficient, and which is no doubt welcomed by MF Global’s customers. But the speed and efficiency with which SIPC responded to MF Global’s demise stands in stark contrast to its handling of the Stanford Financial case.

As I’ve written before, customers of Stanford’s SIPC-insured brokerage waited more than two years for the SEC to notify SIPC of the need to protect investors, and since that notification this summer, SIPC’s board has been dragging its feet. While it considered the issue at a September board meeting, there’s been no word since then, and Stanford’s U.S. brokerage customers remain in the dark.

The Stanford case was, of course, more difficult. The money investors lost was in the form of certificates of deposit backed by Stanford’s offshore bank that the brokerage peddled to its customers. But neither the SEC nor SIPC has acted “as quickly as possible.” As we approach the third anniversary of Stanford’s demise, it’s way past time for SIPC to make good on its obligations to Stanford’s victims.

Tuesday, 1 November 2011

Romney Family Investment Group Partnered With Alleged Perpetrators Of $8 Billion Ponzi Scheme

By Lee Fang (Think Progress)

Mitt Romney, his son Tagg, and Romney’s chief fundraiser, Spencer Zwick, have extensive financial and political ties to three men who allegedly participated in an $8.5 billion Ponzi scheme. A few months after the Ponzi scheme collapsed, a firm financed by Mitt Romney and run by his son and chief fundraiser partnered with the three men and created a new “wealth management business” as a subsidiary.

In an exclusive interview with ThinkProgress, Tagg Romney confirmed their business relationship, but falsely claimed that the men were cleared of any wrongdoing associated with the Ponzi scheme. Tagg Romney told ThinkProgress that his three partners collected about $15,000 from their involvement in the Ponzi scheme. Court documents obtained by ThinkProgress show that the legal proceedings are ongoing and the men made over $1.6 million selling fraudulent CDs to investors.

The Ponzi Scheme

In 2009, prosecutors announced charges against the Stanford Financial Group, which managed a portfolio of $8.5 billion, for running a “massive, ongoing fraud” against its investors. The Ponzi scheme bust was one of the largest in recent history, second only to Bernie Madoff, who perpetrated a fraud estimated to be around $17 billion. The Stanford Ponzi scheme wiped out the savings of thousands, including many American retirees across the country. In Texas, 1290 people lost their retirement savings because of the Stanford Ponzi scheme; in Louisiana, several hundred reportedly suffered the same fate.

The Romney Business Connection

Solamere Capital, the investment company founded by Tagg Romney with seed money from his father, Mitt Romney and other investors.
Launched in 2008 by Romney’s son Tagg and a few others, including Mitt Romney’s chief fundraiser Spencer Zwick, Solamere Capital is a “fund of funds,” meaning that it primarily invests in other investment companies, like private equity groups.

Mitt Romney himself made a $10 million initial seed investment in Solamere Capital and his personal financial disclosure forms reveal that he has received between $100,000 and $1 million in returns from his stake in Solamere. Romney has come under fire for refusing to release his tax returns, which would likely reveal additional details about his financial relationship with Solamere Capital.

After news of the Ponzi scheme precipitated the collapse of Stanford in 2009, Tagg partnered with several of Stanford’s North Carolina executives to start a firm called Solamere Advisors. At least three prominent brokers who had worked for Stanford — Tim Bambauer, Deems May, and Brandon Phillips — joined Tagg to help run Solamere Advisors, a wealth management business located in Charlotte, North Carolina. “We are excited to be associated with such a highly capable group of financial advisors with a proven track record of meeting the needs of their clients throughout the Southeast,” said Tagg in a press release announcing Solamere Advisors, which borrows its the name from its parent company, Solamere Capital.

The Romney Campaign Connection

The Romney campaign and the Romney family investment company are deeply entwined. A recent Boston Globe investigation found that top donors to the Romney campaign have invested into Tagg’s firm, and that Romney’s star campaign fundraiser, Spencer Zwick, doubles as a managing partner for Solamere Capital. The Romney campaign has paid Zwick’s firm, SJZ LLC, over $2 million in fees this year alone. Mitt Romney’s brother Scott Romney is listed as a senior advisor to Solamere Capital.

Tagg Defends Partners, Falsely Claims They Were Cleared Of Wrongdoing

In an interview with ThinkProgress after the CNN debate in Las Vegas, Tagg said he was proud of his investment with Solamere Advisors, the wealth management firm now run by Stanford’s former executives. “They’re friends of ours, they use the [Solamere] name, we own a piece of them,” he said. “We helped them get started.” Romney’s son said he owns a minority stake in Solamere Advisors, but noted that they operate with some level of independence. “We don’t control them at all, we just own them,” he explained.

The Solamere Advisors website lists Bambauer, May, and Tagg Romney among the directors of the firm (Eric Scheuermann, a managing partner for Solamere Capital, is also a director of Solamere Advisors). The Solamere name comes from “a private community in Deer Valley, Utah, where [Mitt] Romney owned a ski mansion,” reports Globe writers Michael Kranish and Donovan Slack.

“Did you know that some of those guys were in with, there were allegations that some of those guys were involved with the Allen Stanford Ponzi scheme?” ThinkProgress asked. “Before we invested in them, they were in that. But they were cleared of that before we made our investment,” replied Tagg, who spoke to ThinkProgress for a few minutes while walking around the Venetian hotel after the debate.

ThinkProgress also asked about the allegedly fraudulent profits made by his partners in helping orchestrate the Stanford Ponzi scheme and the current effort by Stanford’s victims to retrieve their money. In response, Tagg claimed that his colleagues are also victims: “They probably made, their pay there was like $15,000 total. Those guys got totally screwed by the whole thing. It almost ended their whole careers because they moved all their clients over [to the Stanford Financial Group], and then the place was shut down two months after they moved their clients over. They hadn’t made any money yet. They had bonuses and everything promised to them, but they didn’t make any of their money. So they made no money.”

Tagg’s assertions, that his Solamere Advisors partners who were employed in the Stanford Ponzi scheme didn’t make “any money,” and that they their involvement in the Ponzi scheme has been “cleared,” contrasts with court documents obtained by ThinkProgress. According to documents reviewed by ThinkProgess using the Pacer search engine, charges against Tim Bambauer, Deems May, and Brandon Phillips have not been dropped. A recent court filing shows May requesting the court for arbitration instead of going to trial. ThinkProgress also spoke to the deputy clerk for the federal District Court in Dallas, and confirmed that the three men are still defendants in the lawsuit to recover the Ponzi scheme money.

Moreover, a court-appointed audit of the Stanford Financial Group found that several of the former Stanford brokers made far more than what Tagg claimed:

– Solamere Advisors managing partner Tim Bambauer made $1,143,392 in incentive pay selling fraudulent CDs to investors.
– Solamere Advisors partner Deems May made $465,000 in incentive pay selling fraudulent CDs to investors.
– Solamere Advisors operations manager made Brandon Phillips $70,000 in incentive pay selling fraudulent CDs to investors.

The lawsuit filed by the Securities and Exchange Commission claims the Stanford Financial Group built its Ponzi scheme by incentivizing brokers to sell fraudulent CDs with an array of bonuses. A document filed in the District Court of North Texas says that Stanford “used an elaborate and sophisticated incentive program” to encourage brokers, like Bambauer and others, to lure investors into the Ponzi scheme. A suit to recover money for Stanford’s victims declares that Stanford’s former brokers are not entitled to their performance pay because those funds were made in “furtherance of the Ponzi scheme.”

Despite Tagg’s assertion that his partners were innocent and had no idea what was going on, representatives for Stanford’s victims differ. San Antonio attorney Edward C. Snyder, an attorney representing Stanford’s investor victims, scoffed at the notion that Stanford’s brokers did not know what they were getting into. They were “making outrageous fees and commissions from selling and promoting CDs,” said Snyder in an interview with ThinkProgress, adding, “no one makes that kind of money doing that.” As the litigation continues, Synder said he is confident that all of Stanford’s brokers that received performance pay selling CDs “are going to give the money back.” Snyder told us that many of Stanford’s brokers have made the argument that they had no idea what was going on, but he isn’t buying it. “Anyone that was selling a related-company offshore bank CD to his clients, and making such a large percent of commission, should have their license revoked,” wrote Snyder in an e-mail.

Bambauer, hired by Tagg in July 2009 as the managing partner for Solamere Advisors, left the firm two months ago, according to Deems May, who spoke to ThinkProgress last week. Bambauer was a higher level executive at the Stanford Financial Group. The Solamere Advisors website still lists Bambauer as a director of the firm along with Tagg. A message left with the Bambauer household has not been returned.

Asked about the current effort by the court-appointed receiver to retrieve the commissions received in selling Stanford Ponzi scheme CDs, May said he “can’t comment on anything like that.” Tagg told ThinkProgress that he now only owns a 5 percent stake in Solamere Advisors, but May said to check with Eric Scheuermann, Tagg’s business partner, about the extent of Solamere Capital’s ownership holding in Solamere Advisors. Mays also referred ThinkProgress’ other questions to Solamere Capital, but the firm has not responded to ThinkProgress’ request for comment.

ThinkProgress compiled a chart illustrating the financial connections between Mitt Romney, the Romney for President campaign, Tagg Romney, and the alleged Ponzi scheme brokers:

Despite Ponzi Business Connection, Romney Promises To Repeal New Investor Protection Laws

The revelation about Romney’s ties to the Stanford ponzi scheme unmask the risks associated with removing new investor protections. The Dodd-Frank Wall Street Reform law, a reform Romney says he will repeal if he wins the presidency, attempts to address future Ponzi schemes by enacting new protections for whistleblowers to alert authorities when they find evidence of fraud. The law also creates a new Investor Advocate and Investor Advisory Committee within the Securities and Exchange Commission to detect and investigate future Ponzi schemes.

Mike Hudson, a reporter with iWatch News and author of a new book about how predatory Wall Street practices created the financial crisis, told ThinkProgress that Dodd-Frank “could be a game changer that helps the SEC identify and shut down Ponzis and Ponzi-like schemes.” But on the campaign trail, Romney, a fierce critic of efforts to reign in Wall Street practices, has called new investor protections like Dodd-Frank “extraordinarily burdensome.”

When ThinkProgress spoke to Tagg in Las Vegas, the last question about the Stanford Ponzi scheme was this: “How do you prevent a Ponzi scheme like that?” “Hey guys, we’re done,” Tagg said before taking off.

[Update]In an e-mail to National Journal’s Chris Frates, the Romney campaign attacks ThinkProgress as “a left-wing blog with a highly partisan agenda.” The Romney campaign did not directly dispute any of our assertions. Rather, the Romney spokesperson called our story “false material.” The Romney campaign has not backed up Tagg Romney’s assertion that his Solamere Advisors partners were “cleared” of wrongdoing in connection to the Stanford Financial Group Ponzi scheme. We stand by our reporting.