Tuesday, 30 December 2014

IRS Hikes Offshore Account Penalty To 50% For Stanford Companies

The IRS updated (12/23/14) its list of so-called bad foreign banks where offshore accounts trigger a 50% (rather than 27.5%) penalty in the Offshore Voluntary Disclosure Program (OVDP). The IRS added Sovereign Management and Legal, Ltd., plus certain branches of Bank Leumi. Neither addition should come as a surprise. Both banks have been targets of the Department of Justice.

 Israel’s Bank Leumi is fresh off its $400 million settlement with the U.S. and New York, so its addition to the 50% list is the other shoe dropping. Sovereign’s addition should also raise no eyebrows, coming on the heels of numerous that John Doe Summonses issued to FedEx, DHL, UPS, HSBC relating to Sovereign. Presently, taxpayers in the 2014 OVDP face a 50% penalty if they had accounts at any of the following:


  1. UBS AG
  2. Credit Suisse AG, Credit Suisse Fides, and Clariden Leu Ltd.
  3. Wegelin & Co.
  4. Liechtensteinische Landesbank AG
  5. Zurcher Kantonalbank
  6. swisspartners Investment Network AG, swisspartners Wealth Management AG, swisspartners Insurance Company SPC Ltd., and swisspartners Versicherung AG
  7. CIBC FirstCaribbean International Bank Limited, its predecessors, subsidiaries, and affiliates
  8. Stanford International Bank, Ltd., Stanford Group Company, and Stanford Trust Company, Ltd.
  9. The Hong Kong and Shanghai Banking Corporation Limited in India (HSBC India)
  10. The Bank of N.T. Butterfield & Son Limited (also known as Butterfield Bank and Bank of Butterfield), its predecessors, subsidiaries, and affiliates
  11. Sovereign Management & Legal, Ltd., its predecessors, subsidiaries, and affiliates
  12. Bank Leumi le-Israel B.M., the Bank Leumi le-Israel Trust Compay Ltd., Bank Leumi (Luxembourg) S.A., Leumi Private Bank S.A., and Bank Leumi USA


Read More here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum http://sivg.org.ag/


Thursday, 25 December 2014

Allen Stanford's Lawyers Shed Some Charges

Investors harmed in R. Allen Stanford's $7 billion Ponzi scheme cannot sue the Greenberg Traurig and Hunton & Williams law firms for breach of fiduciary duty, a federal judge ruled.

The Official Stanford Investors Committee and court-appointed receiver Ralph Janvey, with Krage Janvey in Dallas, sued both law firms and Miami attorney Yolanda Suarez in Dallas Federal Court in 2012, alleging legal malpractice, breach of fiduciary duty and fraudulent transfer, among other things.
They claimed the defendants aided the scheme's success and eventual downfall by providing deficient legal services.

They said Suarez was Stanford's chief of staff and the "protegé" of attorney Carlos Loumiet, a partner first at Greenberg and later at Hunton.

U.S. District Judge David C. Godbey granted in part the defendants' motion to dismiss on Dec. 17, finding that the investors failed to plead an independent claim for breach of fiduciary duty.2011


Read More here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum http://sivg.org.ag/


Saturday, 13 December 2014

Receiver files 11th Schedule of Payments to be Made Pursuant to the 1st Interim Distribution Plan

Receiver files 11th Schedule of Payments to be Made Pursuant to the 1st Interim Distribution Plan - On December 12, 2014, the Receiver filed his 11th Schedule of distribution payments under the 1st Interim Distribution Plan with the United States District Court for the Northern District of Texas, Dallas Division. The 11th Schedule will be followed by others, each of which will be submitted by the Receiver on a rolling basis as additional responses to Certification Notices are received and processed.

To view a copy of the 11th Schedule, please click here.


For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum http://sivg.org.ag/


Friday, 12 December 2014

Federal judge in Dallas clears way for some Stanford victims to have day in court


WASHINGTON–On the topic of justice, few have said it better than the novelist William Gaddis in his 1994 novel, A Frolic of One’s Own. “Justice? – you get justice in the next world, in this world, you have the law.”

 For victims of the Allen Stanford Ponzi scheme, justice is still a very long way off, even if Stanford himself has been serving his 110-year sentence in a federal prison since 2012.

 But this week, the law took a tiny turn in favor of victims and it happened in a Dallas court room. U.S. District Judge David Godbey of the Northern District of Texas issued two opinions this month, the second one on Monday, that keep alive the Stanford victims’ still-slender hopes of recovering money from the Wall Street firms and other financial power-brokers who were paid millions by Stanford over the years for help in keeping in motion what has turned out to be perhaps the most far-reaching financial scandal in U.S. history.

 The facts of the case by now are familiar: Some 20,000 Stanford investors around the world lost more than $5.5 billion in principal and nearly $2 billion more in interest when the federal government finally acted in 2009 to shut down the sprawling, global investment empire he ran from offices in Houston and from the tiny Caribbean nation of Antigua. Godbey ordered Stanford’s assets frozen and turned over to Dallas lawyer Ralph Janvey, who was appointed receiver.

 In the years since, plaintiffs have recovered precious little of their money — about a penny on the dollar. One remaining hope they have is to sue the professional services firms that profited so mightily over the years from their work for Stanford. So far, it’s been a tough legal hill to climb, despite a surprisingly favorable ruling by the Supreme Court. The justices ruled 7-2 in February that federal securities laws don’t require that all cases be heard in federal court Some state-court actions will be permitted, opening up the possibility that plaintiffs can sue on negligence and other grounds. 

That ruling hasn’t resulted in any victories yet for the plaintiffs, but they did get a burst of good news out of Dallas this month.

 In Monday’s opinion, Godbey ruled that the clearing agent (useful definition here) for the Houston-based broker-dealer that persuaded thousands of Stanford’s victims to put their money in phony certificates of deposits can be sued. That agent is Pershing, LLC, a subsidiary of the venerable Bank of New York Mellon. It will have to go to trial on allegations that it breached its fiduciary responsibility in being such a pliant participant in the scheme. The Houston-based broker-dealer, known as Stanford Financial Group, was a separate entity owned by Allen Stanford and licensed by the U.S. financial regulators. So far, courts have sided with defense attorneys who argue the actual fraud that took place was accomplished by Stanford’s stand-alone bank in Antigua. Investors actually sent their check to this bank, not to the Houston brokers, and as a result victims have had little luck holding the U.S. financial system responsible for any of their losses.

 Monday’s opinion doesn’t mean they’re about to hit pay dirt. Godbey simply declined Pershing’s motion to dismiss a suit brought by investors from Texas and Louisiana. It had argued, among other things, that as clearing agents for the Houston firm, it was as a matter of law too far removed from the actual fraud to be liable for the losses.

 Godbey disagreed. It’s true, he wrote, that federal courts have held just that, shielding clearing agents from liability in an underlying fraud. But he also ruled that when plaintiffs can show — as they do here — that the aid provided by the agents went beyond mere clerk-like duties, the issue becomes one ripe for trial. In addition, the Texas Securities Act provides that when an otherwise shielded party like Pershing can be shown to have had adequate knowledge that its services were being used to carry out an improper end, it can be held liable.

 Monday’s ruling doesn’t mean that the plaintiffs’ will prevail at trial, or that they can prove the allegations they’ve made. It just means that they’ll get a chance to make their case.

 The earlier ruling by Godbey was similar, and potentially good news for the victims. He ruled Dec. 5 that a suit brought by the receiver, Ralph Javney, against insurance brokers can proceed. Those insurance brokers issued letters of good standing, essentially, which were in turn used by Stanford’s employees to make investors feel safer in sending their money to the bank in Antigua. Those policies didn’t cover deposits in the bank, only investments held by the Houston brokers. The plaintiffs allege the insurance brokers knew or should have known that. Now, they’ll get a chance to prove it.





Read More here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum http://sivg.org.ag/


Thursday, 4 December 2014

Stanford appeal delayed 60 days as court grants DOJ more time to respond

Allen Stanford leaves jail to attend his federal trial in Houston in March 2012
WASHINGTON—Allen Stanford’s many victims have grown used to waiting. They waited for years for the former Houston billionaire to be tried, and they’re still waiting to see some of their billions that the disgraced banker fleeced from their investment accounts.

 They’ve also been waiting for Stanford’s 2012 conviction to finally be settled, and of that to happen the Fifth Circuit Court of Appeals in New Orleans is going to have to hear his appeal, something that has been delayed again and again as Stanford has worked through a series of fired lawyers and finally filed his 299-page brief this fall.

 Word came this week, however, that the victims will have a wait a little longer still — and this time it’s the U.S. Government that has sought the delay. The Fifth Circuit granted the DOJ’s request for more time to file its answer to Stanford’s appeal on Tuesday.

 The U.S. response to Stanford’s brief, which he has since rewritten and scaled down to comply with court rules on length, is due Feb. 3.

 The court granted the government’s request without seeking Stanford’s approval, a point he apparently didn’t like. He filed a letter yesterday saying that he is “vehemently opposed” to the 60-day extension, and will be filing a motion in opposition soon, though such a motion doesn’t seem likely to have any legal significance at all.

 Stanford is serving a 110-year sentence in a federal prison in Florida. He was convicted of fraud after an SEC complaint triggered an investigation into what a jury later concluded had been a massive, transcontinental Ponzi scheme centered in Houston and in Antigua.

Read More here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum http://sivg.org.ag/


Sunday, 23 November 2014

Thursday, 13 November 2014

Stanford SFA Update November 2014


Read More here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum http://sivg.org.ag/


Obama taps corporate lawyer to lead brokerage industry-backed fund

(Reuters) - President Barack Obama on Wednesday nominated corporate attorney John Mendez to become the next chairman of an industry-backed fund created by Congress to help investors recover their money when brokerages fail.

 Currently a partner at the law firm Latham & Watkins, Mendez holds a law degree from Harvard and previously worked at several other top firms including Skadden Arps and White & Case.

 If confirmed by the U.S. Senate, Mendez would lead the Securities Investor Protection Corp, a non-profit corporation which has been involved in liquidations in high-profile cases such as the collapse of Lehman Brothers and the fallout from Bernard Madoff's Ponzi scheme.

 Mendez will face intense scrutiny in the U.S. Senate, where many lawmakers are pressing the SIPC to be more sympathetic to investors.

 SIPC has come under fire by lawmakers from both parties, after the organization declined to launch a court proceeding to help the victims of Allen Stanford's $7 billion Ponzi scheme try to recover some of their losses.
SIPC argued the victims could not file claims because they did not meet the legal definition of "customer" under the law.

 The U.S. Securities and Exchange Commission, which oversees SIPC, took SIPC to court to try and force it to allow victims to file claims, but SIPC prevailed in a U.S. appeals court earlier this year.

Read More here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum http://sivg.org.ag/


Friday, 7 November 2014

Receiver files 1st Schedule of Payments to be Made Pursuant to the 2nd Interim Distribution Plan

Receiver files 1st Schedule of Payments to be Made Pursuant to the 2nd Interim Distribution Plan - On November 5, 2014, the Receiver filed his 1st Schedule of distribution payments pursuant to the 2nd Interim Distribution Plan with the United States District Court for the Northern District of Texas, Dallas Division. The 1st Schedule will be followed by others, each of which will be submitted by the Receiver on a rolling basis.

To view a copy of the 1st Schedule, please click here.

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum http://sivg.org.ag/


Thursday, 30 October 2014

KLS - Stanford SEC Update

Here is an update from Kachroo Legal Services regarding the appeal against the SEC





Read More here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum http://sivg.org.ag/


Tuesday, 28 October 2014

Fifth Circuit to convict Allen Stanford: Follow the rules or risk losing chance to be heard

Former Houston billionaire Allen Stanford,
convicted in 2012 of operating a Ponzi scheme
that defrauded more than 18,000 investors, is
appealing his conviction. He's currently serving
a 110-year sentence. File photo.

WASHINGTON — The appeals court that will hear former Houston billionaire Allen Stanford’s appeal has sent him a blunt warning. Keep breaking the rules when it comes to filing your appeal, and he may lose his chance to be heard at all.

 That’s the message sent last week when the Fifth Circuit Court of Appeals in New Orleans wrote Stanford a letter telling him that the court has filed his latest brief arguing that his 2012 conviction was illegal. “However, you must make the following corrections within the next 14 days,” an Oct. 23 letter from the court to Stanford reads.

 Adds the court clerk: “As this is the second request to make your brief sufficient, any further insufficiencies received may move the court to strike your brief and dismiss your appeal.”

 Stanford was sentenced to 110 years in prison, and is serving his term in central Florida. He has fired his lawyers and is representing himself. He filed a 299-page appeal in September, which the court promptly rejected as too long. He was given to Oct. 6, and then an extension to Oct. 22, to make it conform to the already-relaxed guidelines stipulated by the court.

 He made the deadline, but still wasn’t following the rules. He’s now been ordered to strip out all of the attachments he has sent that aren’t “opinions, statutes, rules, and regulations.” He’ll also have to get three more copies of the brief made.

 Stanford’s new brief is 174 pages, including exhibits and other appendices. His initial brief was 299 pages.

 Murray Waas of Vice Media and I reviewed the contents of his initial arguments here. He has until Nov. 6 to make the requested changes. The U.S. government will respond to the brief with an argument of their own for why he’s right where he belongs, before three judges on the 5th Circuit will make a ruling.

Allen Stanford's Revised Appeal can be read here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum http://sivg.org.ag/


Thursday, 23 October 2014

Could Allen Stanford go free? Convicted fraudster appeals

Indicted financier R. Allen Stanford exits the Bob Casey Federal Courthouse in Houston, Texas.

Jailed financier R. Allen Stanford, convicted in 2012 of running a massive global Ponzi scheme that rivals the Madoff scandal, says he is the victim of an illegal prosecution, and "the clearest of assaults on the U.S. Constitution."

 The comments come in Stanford's formal appeal of his conviction, filed in federal court on Wednesday. Stanford wrote the appeal himself at the prison in Florida where he is serving a 110-year sentence. Having fired the last of a string of court-appointed attorneys, and with no funds to hire a replacement, he is representing himself even though he has no legal background. He has also asked to argue his case in person before the Fifth Circuit Court of Appeals in New Orleans, a task normally handled by experienced attorneys.

 Stanford calls the case against him a "reckless action," and accuses authorities of a "by-any-means pursuit" of him to cover up their missteps in the still-unfolding financial crisis.



Read More here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum http://sivg.org.ag/


Friday, 17 October 2014

Ponzi Receiver Can Go After Tiger's Charity

DALLAS (CN) - The court-appointed receiver for R. Allen Stanford's $7 billion Ponzi scheme can go after the Tiger Woods Foundation charity for $500,000 in alleged fraudulent transfers, a federal judge ruled.

 Ralph Janvey, a partner with Krage Janvey in Dallas, sued the Tiger Woods Foundation and Tiger Woods Charity Event Corp. in April. He claimed they received the money in two transfers from Stanford Capital Management LLC, Stanford Financial Group Co. and the Stanford Financial Group Building Inc. Janvey claimed the money was from " innocent, unwitting " Stanford investors.

 U.S. District Judge David C. Godbey denied the defendants' motion to dismiss on Wednesday, finding that the charity could not prove Janvey's claims are time-barred.

 Godbey said the foundation relies on "far too many factual ambiguities" for its motion to be granted. 

Janvey's fraudulent transfer claim under Texas law has a 4-year statute of limitations; his unjust enrichment claim has a 2-year limit. "

The parties agree that the relevant date of reference here is December 13, 2013, the date on which the parties signed the tolling agreement," the 9-page order states. "Thus, the Receiver's [fraudulent transfer] claim is time barred if he could have discovered it before December 13, 2012, and the unjust enrichment claim is time barred if it accrued before December 13, 2011. The Receiver argues that because he pleads the discovery rule, an issue of fact exists as to when he discovered his causes of action and his complaint cannot be dismissed. The court agrees."

 The discovery rule under Janvey's fraudulent transfer claim gives plaintiffs a year to sue after the claim "could reasonably have been discovered by the claimant."

 "Application of the discovery rule is generally a fact-intensive issue inappropriate for resolution in a motion to dismiss," Godbey wrote. "Even once a plaintiff has been exposed to information that gives rise to a duty to inquire, whether the plaintiff has been diligent in making that inquiry is ultimately a question of fact" to be determined at trial.

 Godbey was not persuaded by the foundation's argument that Janvey failed to plead "diligence at all" in discovering the transfers.

 "This argument fails because, as discussed, the Receiver does allege diligence in discovering these transfers by claiming his team spent hours pouring over obscure financial records in order to identify actionable transfers," the order states. "Defendants take issue with the fact that the Receiver has not specifically contended that these particular transfers were concealed or difficult to discover. But, that would require too much of the complaint at the motion to dismiss stage."

 Godbey found that in a light most favorable for Janvey, it is "perfectly reasonable" to conclude that the "generally complex and obfuscated nature of the Stanford financial records made these particular transfers difficult to discover."

 The foundation did not immediately respond to a request for comment Thursday.

 Janvey has aggressively tried to recover funds originating from the Ponzi scheme, filing approximately 50 lawsuits against recipients since his appointment, according to the Courthouse News database.

 His targets have included the Miami Heat basketball team, Texas A&M University, the University of Miami, the PGA Tour and the ATP Tour, among others.

Read More here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum http://sivg.org.ag/


Friday, 10 October 2014

Stanford Promises to Prove his Innocence and Repay Victims

To the Stanford International Bank depositors, and clients of the global Stanford Financial Group 

 As this is the first statement from me since the February 17, 2009 destruction of the global Stanford companies, and my imprisonment for allegedly operating a fraud that has been referred to as a "Ponzi scheme", I want to be direct, clear and emphatic. The actions taken by the U.S. government against me and my companies and that resulted in such harm to so many of you, was baseless, opportunistically contrived and, most importantly, unlawful. To many of you, and especially those of you who believe in and trust the accuracy and veracity of the American media machine, for now I will simply advise you of the series of legal actions taken by me in recent months and ask that you look at them on line, read them carefully and then follow their progress through the American legal system. In the coming days and weeks, as these legal initiatives make their way through the courts I will be posting a daily message on this site to keep informed those of you who have been harmed. 

Meanwhile, I want all of you to know, the many of you around the world who entrusted me and my companies with your investment monies, that it is my intent, and in fact my mission in this life, to restore my good reputation as an honest man, and to personally repay each and every one of you... in full ...each and every dollar that was so wrongfully taken from you by the Securities and Exchange Commission. The manner in which I intend to achieve this will be made clear in the coming weeks. 

Thank you,

 R. Allen Stanford

Read More here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum http://sivg.org.ag/


Wednesday, 8 October 2014

Investor frustration peaking over stockbroker insurance

"The more you learn about what's going on down [on Wall Street], the more you learn is that it's not a safe place to invest," said Boston University economist Lawrence Kaltikoff.








You get blindsided in a wreck, and you expect your insurance company to pay.

 Your bank goes belly up, and you expect the Federal Deposit Insurance Corporation to reimburse your losses up to $250,000.

Your stock broker fails, and you expect the Securities Investor Protection Corporation to be good for your losses up to $500,000.

 But five years after Allen Stanford's $7 billion fraud on his investors, SIPC has paid them nothing.

 "I call Wall Street 'Fraud Street' these days," said Boston University economist Lawrence Kaltikoff. "Because the more you learn about what's going on down there, the more you learn is that it's not a safe place to invest."

 Not safe, he said, because the SIPC — which is supposed to protect investors when brokerages fail — has done nothing to protect the victims of Allen Stanford.

 "If SIPC wasn't behind Stanford, he never would have been able to run a business as he did," said Mary Oliver.

 She and scores of others went to Stanford's office in The Crescent office building in Dallas and invested their 401k money back in 2008. The seal of the Securities Investor Protection Corporation was on her broker's business card, and on the office door.

 The market was nervous, and SIPC insurance was a prime inducement to place her money with Stanford.

 Five years later, the SIPC claims all those Stanford losses aren't its problem. In fact, the SIPC says investors who lose money in some brokerage failures could actually owe money to the SIPC.

 In addition, this summer a federal appeals court upheld a ruling that what Allen Stanford sold investors weren't Wall Street securities, but certificates of deposit. Therefore, the SIPC should not be on the hook for the investor losses.

 It was all in the small print, the SIPC argued.

 "The Allen Stanford victims were supposed to read somewhere in 30 pages of documents when they signed up that their investments were [certificates of deposit], and not covered by SIPC," Kaltikoff said. "I think [the] SIPC should be ashamed of themselves. I would be embarrassed to be doing what they're doing.

 "I couldn't sleep at night to do that to people who've already been victimized," he added.

 Mary Oliver joined the Stanford Victims Coalition, which went to Washington to try to change the law. Their goal: To make SIPC more responsive to fraud, and to get some of their money back. 

House Bill 3482, which would do that, has been knocking around Congress for a year. It's been held up in the House Financial Services Committee, chaired by Rep. Jeb Hensarling of Dallas.

 Hensarling is a big recipient of campaign donations from the brokerage industry, which funds SIPC insurance through premiums. Those premiums could potentially go up if the SIPC were reformed.

 In the 2013-14 election cycle, Hensarling received $41,000 from two Wall Street brokerages alone. 

We asked him for an interview to discuss House Bill 3482. He was "unavailable."

 In a written statement, Hensarling said he sympathizes with the Stanford victims, but "concerns regarding SIPC's actions [...] are best addressed by the courts."

 He blamed the Stanford debacle on regulatory failures by the Securities and Exchange Commission. 

"When Congress reconvenes early next year, I expect there will be a renewed debate about the purpose and scope of SIPC," Hensarling said in the statement.

 It's been five years since the Stanford fraud came to light. So far, investors have received one penny for every dollar they've invested.

 None of it came from the SIPC.

Read More here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum http://sivg.org.ag/


Monday, 6 October 2014

THE DERAILMENT OF THE SEC – PART V: WHY A RESPECTED LAW FIRM ALLEGEDLY RISKED BREAKING THE LAW BY REPRESENTING A ROGUE BILLIONAIRE BANKER

R. Allen Stanford—the billionaire fraudster and cricket enthusiast—with some cricket players in 2008. Photo by Brian Smith/Corbis Outline

A former Securities and Exchange Commission official and his law firm sought millions of dollars in new legal business in 2006 from financier R. Allen Stanford—during the same period of time the law firm had agreed to defend Stanford before the SEC, despite warnings from the SEC’s ethics counsel that any such representation would be illegal.

 Stanford lavished lucrative legal business on former SEC enforcement officer Spencer C. Barasch and the Houston law firm of Andrews Kurth, where Barasch is a partner, to persuade them to defend him before the SEC. Initially, in 2005, Barasch and Andrews Kurth turned Stanford down when he asked them to represent him before the SEC, telling him that to do so would violate federal conflict-of-interest laws. In 2006, however, Barasch ignored the legal prohibition and agreed to do so anyway.
Confidential Andrews Kurth billing records show that in 2006, while Stanford was pressing Barasch and Andrews Kurth to defend him before the SEC, Stanford hired the law firm to represent him on seven other legal matters, adding an eighth in 2007. In addition, according to a former Andrews Kurth employee, Barasch told his fellow partners that they stood to earn as much as $2 million a year for defending Stanford before the SEC. Previously, Stanford had been only a relatively modest client for the law firm. Barasch and Andrews Kurth declined to comment for this story.

 As the former chief enforcement officer of the SEC’s Fort Worth regional office, Barasch had overseen the agency’s monitoring of Stanford’s bank and brokerages. Between 1998 and 2005, Barasch had personally quashed six separate investigations of Stanford, according to government records. Officials at the SEC finally approved its first formal investigation of Stanford exactly one day after Barasch left the agency; examiners whom Barasch had stymied for years acted knowing they might succeed once he was gone. In 2009, the SEC and Justice Department would charge Stanford with masterminding a $7 billion Ponzi scheme, the second-largest in American history.

 It was because of Barasch’s Stanford-related work at the SEC that Stanford wanted to hire Barasch so badly, according to interviews and records. Barasch had inside information on what had worked in the past to persuade his colleagues to shut down earlier investigations of Stanford. Barasch even boasted to one of Stanford’s top deputies about his access and influence with former colleagues he might be able to persuade once again, now from the outside, not to investigate the billionaire financier. Stanford was determined to do whatever he could to get Barasch “on board asap,” he wrote in an email to two of his deputies.

 The 2006 SEC investigation would go on to reveal that Stanford’s international banking empire was one built on a foundation of financial fraud, deception, and bribery. It would take more than a decade after SEC examiners first uncovered evidence that he was engaged in a Ponzi scheme for Stanford to face criminal charges brought by a federal grand jury and the SEC. Stanford would be convicted by a federal jury in June 2012 and sentenced to a 110-year term in federal prison.

 The new information in this story—that Stanford awarded Andrews Kurth with eight new legal representations while trying to persuade them to defend him before the SEC—provides the first explanation of why Barasch and Andrews Kurth would risk violating the law—and the consequences of doing so. A former employee of the firm told me that the prospect of lucrative legal work played a role in persuading some of the firm’s partners to ignore the law, and Andrews Kurth’s billing records, confidential emails, and other documents appear to partially confirm this.

Read the Full Article here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum http://sivg.org.ag/


Sunday, 5 October 2014

Allen Stanford files 299-page appeal of his 110-year sentence

Allen Stanford was convicted in 2012 on 13 felony charges related to America’s second-largest Ponzi scheme ever.


WASHINGTON — Even tucked away inside a high-security federal prison in Central Florida, former Houston billionaire banker Allen Stanford is still thinking big — and flouting the rules.

Stanford filed a 299-page brief last month with the 5th U.S. Circuit Court of Appeals in New Orleans, making no fewer than 15 lengthy arguments about why he should be set free. He was convicted in 2012 on 13 felony charges related to America’s second-largest Ponzi scheme ever and sentenced to 110 years in prison.

Before being halted by a federal judge in Dallas in 2009, Stanford’s fraud had drawn in more victims than any other investment scheme in American history. There are more than 18,000 outstanding claims from defrauded investors and thousands more under review.

Investors had deposited about $5.5 billion with Stanford, and so far just $72 million has been repaid to investors.

Kevin Sadler, the attorney for Ralph Janvey, the Dallas-based court-appointed receiver, said that nearly 1,400 verified claims totaling $455 million have been filed by investor groups with at least one victim living in Texas. There are 111 claims worth nearly $51 million with ties to Dallas residents.

Stanford’s verbose appeal is his best and probably only chance to die a free man. The court has given him until Monday to file the appeal again, at about half its current length.

Since he fired his court-appointed attorney, Stanford is writing his own appeal. In it, he divides his chief arguments into two broad attacks — that the U.S. didn’t have jurisdiction over his offshore business and that his trial in Houston was bungled.

The charges against him were improper, he writes, since his bank was in Antigua, not the United States, and offered clients certificates of deposit, not “securities” as defined by the U.S. statutes.

“Simply put, Stanford International Bank was regulated by — and only by — Financial Services Regulatory Commission of Antigua and Barbuda,” Stanford writes.

That part of his appeal is based in part on Morrison vs. Australian National Bank, a 2009 Supreme Court decision that ruled that Americans defrauded by the Australian bank couldn’t sue under U.S. law, even though incidental parts of the bank’s operations were in America.

Key question
Yet the high court in the Morrison case held that a key question that determines whether an offshore bank fraud triggers U.S. securities laws is whether it marketed its products to Americans.

“They are going to look at the Houston-based company and determine whether there was enough links between it and the CDs sold by Stanford’s bank in Antigua,” said securities law professor Stavros Gadinis of the University of California at Berkeley.

William J. Carney, professor emeritus of corporate law at Emory University in Atlanta, agreed.

“The difference between the Australian case and Stanford’s is that the Australian company didn’t do business in the U.S. and didn’t offer its securities here,” he said.

Carney said Stanford’s other argument, that the CDs he sold aren’t properly “securities,” has a long history in securities litigation.

“The question of whether CDs are securities is really a closer call,” he said.

Stanford also argues in his appeal that he never got a fair trial, thanks to a series of factors all stemming from a savage beating he took from another inmate just five months after he was placed in a federal detention center.

“This assault resulted in a traumatic brain injury ... required extensive reconstructive surgery, and was followed by over-medication of psychotropic drugs,” Stanford writes, describing injuries that prosecutors say he later tried to milk to avoid trial. “All of which, combined, profoundly affected his ability to communicate with his attorneys and prepare his defense.”

Strongest grounds
The beating and all the problems it caused later are probably his strongest grounds for a new trial, said Ali Fazel, who along with his partner Richard Scardino defended Stanford during his seven-week trial.

Before Stanford was indicted in 2009, U.S. District Judge David Hittner ordered Stanford to prison rather than allowing him to post bond. In court records, Hittner said he considered Stanford — who had traveled to 30 nations and five continents in the previous four years — an exceptional flight risk.

In September of that year, Stanford was badly beaten in prison.

“While sitting in a chair, he was grabbed from behind and fell backwards, hitting the back of his head on the concrete floor resulting in a concussion and loss of consciousness,” his lawyers asserted in a court filing before the trial. Unconscious, he was beaten even more severely. His assailant then smashed Stanford’s face with a steel pole, the filing said.

In 2011, Hittner ruled that Stanford was unfit to stand trial and ordered him sent to a prison medical facility for a four-month treatment. And that delay in the trial grew.

When officials at the facility said Stanford needed another four months of care, Hittner reluctantly delayed the trial until January 2012.

The delays meant further suffering for the victims. Hundreds of millions of dollars remained frozen until the outcome of the trial, which kept getting pushed back.

After Stanford’s eight months of treatment were over, his lawyers asked for yet another postponement, citing testimony from a string of psychiatrists that Stanford was still not competent.

Federal prosecutors pounced. They alleged in court papers that despite his injuries, Stanford’s continued efforts to avoid trial were just one more fraud.

They said Stanford had conveniently claimed to have now forgotten “all his past life events … as well as details of his business and banking operations.”

A psychologist at the facility concluded he was malingering and reported that Stanford performed so poorly on a test he administered that “mentally retarded children do much better.”

Fazel said he and his partner recognized, even at the time, that the handling of the trial would be Stanford’s best grounds for an appeal.

“It’s really a shame that a trained and talented appellate attorney didn’t get their hands on the trial record,” Fazel said. “There were lots of issues preserved in the record that would give a trained appellate lawyer a lot of room to work.”

The victims
The delay cost virtually every single one of Stanford’s fraud victims. The only sizable trove of recovered assets — $300 million worth — had been frozen overseas. Under the law, even those funds could not be distributed to victims until Stanford was convicted and there was a finding of fraud by the court.

Most of that $300 million is still frozen, pending appeal.

"Unquestionably the delays at trial, and now with [Stanford] dragging out his appeal by shuffling through attorneys and filing these overlong briefs, have meant a delay of at least two years — and counting,” said Sadler, the attorney for the receiver.

Beyond the dollars, the human impact of the delay, and of the fraud itself, has been enormous.

Among the victims in Texas: a retired businesswoman who lost $1.3 million, money she was relying on to treat a rare genetic disease that would kill her without a kidney transplant; a retired cattle rancher who lost everything and found himself in and out of a hospital intensive-care unit repeatedly as doctors feared the stress was killing him; and a retired railway man and honored Vietnam veteran who feared that he had no money left to take care of a wife disabled with Parkinson’s.

Mary Oliver and her husband were living in Dallas in late 2007 when they began investing their retirement funds — about $1 million — with Stanford. Like most victims, they’ve recovered less than 1 percent of their losses.

“Allen Stanford ruined the lives of thousands of hard-working, tax-paying investors by stealing their life savings,” Oliver said. “He lied, cheated and stole from innocent victims. He deserves to be in jail for the rest of his life on earth.”

Stanford’s appeal is his best shot at avoiding that fate, but even as he prolongs his case, the thousands of people he defrauded have little prospect of ever being made whole.

Read More here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum http://sivg.org.ag/


Friday, 3 October 2014

Appeal of Robert Allen Stanford - Sep. 10, 2014

Following part of the appeal of Stanford.

 STATEMENT OF ISSUES 


 I. Whether the Securities and Exchange Commission (SEC) had jurisdiction and regulatory authority over Stanford International Bank Limited (SIB), or its Certificates of Deposit (CDs). And whether, following the SEC's civil action, the Department of Justice's (DOJ) criminal Indictment was defective.

 II. Whether the simultaneous civil and criminal prosecutions (and sanctions imposed), based on the same underlying events, were violations of the DueProcess Clause of the Fifth and Eighth Amendments, and defendant Stanford's protection from Double Jeopardy.

 III.Whether the Trial Court violated defendant Stanford's Fourth Amendment protection from illegal searches and seizures.

 IV. Whether the District Court abused its discretion when it failed to hold a pre-trial Hearing to determine whether defendant Stanford had any "untainted" funds that could be used to pay for his defense.

 V. Whether the Trial Court abused its discretion by (a) disqualifying defendant Stanford's competent counsel of choice, and; (b) forcing ill-prepared appointed counsel to proceed to trial.

 VI. Whether the Trial Court violated defendant Stanford's Sixth Amendment right to a fair trial, by failing to provide appropriate responses to Jury Notes Two and Three.

 VII. Whether defendant Stanford was deprived of his Sixth Amendment right to a fair trial, because pre-trial publicity precluded the assembly of an impartial jury.

 VIII. Whether the Trial Court abused its discretion by first deeming defendant Stanford competent, and then failing to grant him adequate time to prepare an effective defense, assist his counsel, or prepare to testify on his own behalf; in violation of the Due Process Clause of the Fourteenth Amendment, as well as his Fifth and Sixth Amendment rights to a fair trial.

 IX. Whether the Trial Court abused its discretion by denying defendant Stanford adequate time to prepare an effective defense.

Read More here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum http://sivg.org.ag/


Monday, 29 September 2014

Receiver files 10th Schedule of Payments

Receiver files 10th Schedule of Payments to be Made Pursuant to the 1st Interim Distribution Plan - On September 5, 2014, the Receiver filed his 10th Schedule of distribution payments with the United States District Court for the Northern District of Texas, Dallas Division. The 10th Schedule will be followed by others, each of which will be submitted by the Receiver on a rolling basis as additional responses to Certification Notices are received and processed.

To view a copy of the 10th Schedule, please click here.


For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum http://sivg.org.ag/


Thursday, 25 September 2014

Fifth Circuit affirms summary judgment against “net winners" of Stanford Ponzi scheme

In a recent opinion, the United States Court of Appeals for the Fifth Circuit held that the Texas Uniform Fraudulent Transfer Act allows a receiver to clawback interest payments made to investors under a Ponzi scheme. Beginning in the 1990s, a network of entities created by R. Allen Stanford sold certificates of deposit to investors through the Stanford International Bank, Ltd., promising extraordinarily high rates of return. In a classic Ponzi scheme, Stanford used later investors’ money to pay prior investors their promised returns. The scheme ultimately collapsed, Stanford and CFO James Davis were imprisoned, and the SEC brought suit against Stanford, his agents, and the Stanford entities, alleging federal securities law violations.

 The court-appointed receiver over the Stanford entities brought multiple actions under the Texas Uniform Fraudulent Transfer Act (“TUFTA”) to recover funds paid to investors who purchased certificates of deposit as part of the Ponzi scheme and received back their principal, as well as purported interest on the principal. The Receiver moved for summary judgment on its TUFTA claims against the investor-defendants (described by the court as “net winners” of the scheme), arguing that the payments made to the net winners were fraudulent transfers not made in exchange for reasonably equivalent value. The United States District Court for the Northern District of Texas granted the Receiver’s motions for summary judgment and ordered the investor-defendants to return funds paid in excess of their original investments.

 The investor-defendants filed an interlocutory appeal to the Fifth Circuit, which swiftly rejected each of their arguments and affirmed partial summary judgment in favor of the Receiver. The investor-defendants first argued that the district court’s choice of law analysis was fundamentally flawed and that Antigua law rather than Texas law should apply. The Fifth Circuit concluded the district court correctly applied Texas law, as the scheme was centered in, and operated out of, Houston, Texas, and Texas has a substantial interest in the application of its fraudulent transfer laws because the Receiver, many of the Stanford entities, and some of the defrauded creditors and net winners are in Texas. The court also rejected the argument that the Receiver lacked standing to bring claims under TUFTA, concluding that the Stanford entities, through the Receiver, may recover assets or funds that the entities’ principals fraudulently diverted to third parties without receiving reasonably equivalent value. The court further rejected the investor-defendants’ statute of limitations argument because the suits were filed less than one year after the fraudulent transfer was, or reasonably could have been, discovered (measured from the date of the CFO’s guilty plea). In addition, the court determined that IRA accounts containing net winnings to which the investors had no legal right could not be sheltered as assets.

 On the merits of the district court’s grant of summary judgment, the Fifth Circuit first addressed whether TUFTA’s element of fraudulent intent was satisfied. Fraudulent transfer requires that the debtor transferor make the transfer with actual intent to defraud the debtor’s creditors, and in the Fifth Circuit, such intent may be established by proving that a transferor operated as a Ponzi scheme. Here, it was well-established that the Stanford entities were operated as a Ponzi scheme, thereby establishing fraudulent intent.

 Next, the court addressed the investor-defendants’ argument that they should be permitted to keep their contractually-guaranteed interest payments for which they asserted they paid reasonably equivalent value. Under TUFTA, a transfer is not voidable against a person who took in good faith and for reasonably equivalent value. Value is given if, in exchange for the transfer, an antecedent debt is secured or satisfied. Here, the CDs issued by Stanford were void and unenforceable, invalidating any contractual claim to interest; thus, the court concluded the investors failed to provide any value for the interest payments that they received. The court explained that, in the context of a Ponzi scheme such as Stanford, each payment of interest to an investor (made possible by a later investor’s deposit) decreases the net worth of the entity operating the scheme. Accordingly, the district court’s grant of partial summary judgment in favor of the Receiver on its TUFTA claims was affirmed. Notably, the Fifth Circuit agreed with the district court’s conclusion that the investors did give reasonably equivalent value to the extent that they received back their principal because they have actionable claims for fraud and restitution. Thus, in contrast to the interest payments, the principal payments were payments of an antecedent debt.

Join the Debate here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum http://sivg.org.ag/


KLS Update to Stanford Further Action Clients

KACHROO LEGAL SERVICES, P.C. 

225R Concord Avenue 
Cambridge, MA 02138 

Telephone (857) 829-3041 
Facsimile (617) 864-1125 
gkachroo@kachroolegal.com 

September 24, 2014 

By Email Only 

Re: Update to Stanford Further Action Clients



Dear Stanford Further Actions Client:

Re: ItalBank URGENT – Authorization Form Required 

Many of you have received notification from the Liquidator regarding setting up an account with “ItalBank” to receive distributions. We have confirmed with the liquidator that YOU DO NOT NEED TO SET UP AN ITALBANK ACCOUNT IF YOU HAVE SIGNED THE ENCLOSED AUTHORIZATION FORM.

If you have signed and returned the enclosed authorization form, KLS will be able to directly send your distributions to you.

If you have any questions, please do not hesitate to contact us directly.

Very truly yours,

Gaytri D. Kachroo
Principal, Kachroo Legal Services, P.C.

The authorization form can be downloaded from HERE.



For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum http://sivg.org.ag/


Tuesday, 23 September 2014

Antigua Land Portfolio Brings $60M

Chinese firm YIDA purchased 
1,522 acres of developable land in 
Antigua, on the mainland and on
three adjacent islands.
ANTIGUA—CBRE has completed the sale of developable land along the northeastern coast of Antigua. The portfolio is comprised of approximately 987 acres on the mainland, plus three adjacent islands for a combined total of approximately 1,522 acres.

 Marketed as part of the Stanford International Bank dissolution, the land was acquired by YIDA International Investment Antigua Limited for US $60 million.

 The Chinese firm plans to create “Singulari,” a multi-billion dollar mixed-use project including a golf resort, several five-star hotels, a horse track and residences stretching from the Crump Peninsula to Guiana Island.

 “This transaction is an economic game changer and represents a tremendous opportunity to elevate Antigua’s position as a major Caribbean destination,” said Jeff Woolson, the managing director of CBRE’s Golf & Resort Group. “Singulari will be the largest resort development in the Caribbean since Baha Mar in the Bahamas”.

 CBRE’s United States-based Golf & Resort Group teamed with the Caribbean office of UK-based real estate advisory firm Smiths Gore and local agent Gilbert Boustany to collectively represent the joint liquidators of the Stanford International Bank in this transaction.

Join the Debate here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum http://sivg.org.ag/


Saturday, 13 September 2014

Net Winners in Stanford Ponzi Scam Lose Appeal

Profits seen by some investors in R. Allen Stanford's Ponzi scheme may face seizure by the court-appointed receiver trying to make victims whole, the 5th Circuit ruled.

 Ralph Janvey, with Krage Janvey in Dallas, has filed more than 70 federal fraudulent-transfer suits in Dallas since his appointment. He has targeted former Stanford entities and employees, individual investors and third-party recipients of Ponzi scheme proceeds - included the Republican National Committee, the Democratic Congressional Campaign Committee, Miami Heat basketball team, the Tiger Woods Foundation, Texas A&M University, the University of Miami, the PGA Tour and the ATP Tour.

 In a partial summary judgment for Janvey early last year, U.S. District Judge David Godbey said the hundreds of "net winners" who received interest on top of their principal would still be "in far better shape" after paying back the interest than most other Stanford victims "who lost everything." 

A three-judge panel with the 5th Circuit affirmed Godbey's ruling on Thursday, concluding the net winners have no valid claim to the interest on their phony certificates of deposit (CDs).

 "Here, we conclude that there is no valid claim for interest," the 22-page opinion states. "The CDs issued by [the Stanford International Bank] are void and unenforceable. This is because '[t]o allow and [investor] to enforce his contract to recover promised returns in excess of his undertaking would be to further the debtors' fraudulent scheme at the expense of other [investors].'"

 Any recovery would be paid out of money "rightfully belonging" to the other victims of the Ponzi scheme, not from the Stanford entities' own assets "because they had no assets they could legitimately call their own," Judge Patrick Higginbotham wrote for a three-member panel in New Orleans.

 The appeals court also affirmed that principal payments made to the net winners are off-limits to Janvey and not subject to fraudulent-transfer claims.

 "Unlike interest payments, it is undisputed that the principal payments were payments of an antecedent debt, namely fraud claims at the investor-defendants have as victims of the Stanford Ponzi scheme," Higginbotham wrote.

 Net winners who tried to shelter their profit in individual retirement accounts that are exempted by the Texas Property Code are also not entitled to an exemption, the court found.

 "As we recently explained, to claim this exemption, a defendant 'must establish that she has a legal right to the funds in the IRA,'" the opinion states. "The investor-defendants have offered no evidence to the district court that they have a legal right to the funds despite those funds being the product of a fraudulent transfer. The district court did not err in denying this exemption."

 Janvey could not be reached for comment Thursday evening.

Read more here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum http://sivg.org.ag/


Friday, 12 September 2014

Stanford Investors Want SEC Negligence Claims Revived

Investors in Robert Allen Stanford's $7 billion Ponzi scheme asked the Eleventh Circuit to reinstate their class negligence claims against the U.S. Securities and Exchange Commission, arguing that the agency failed in its statutory duty to properly report the massive scheme.

 The investors' attorney Gaytri Kachroo of Kachroo Legal Services PC told an Eleventh Circuit panel that the SEC has a nondiscretionary duty mandated by Congress to immediately notify the Securities Investor Protection Corp. if it learns that a broker-dealer is in financial difficulty. 

The SEC's Dallas-Fort Worth, Texas, office conducted several investigations of the Stanford Group between 1997 and 2004, and concluded that the Stanford Group was a Ponzi scheme but failed to report the investigations to SIPC, according to court documents.

 This mandatory duty to notify SIPC should not fall under the misrepresentation and discretionary function exceptions of the Federal Tort Claims Act, Kachroo said. Otherwise, the FTCA fails in its legislative objective, she said.

Read the full article here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum http://sivg.org.ag/


Saturday, 6 September 2014

UPDATE 1-U.S. SEC won't appeal ruling against Stanford's Ponzi victims

The U.S. Securities and Exchange Commission will not appeal a recent court decision that thousands of victims of financier Allen Stanford's Ponzi scheme were ineligible under federal law to file claims to recoup their losses, an SEC spokesman said on Friday.

 On July 18, a federal appeals court in Washington rejected the SEC's bid to force the Securities Investor Protection Corp (SIPC) to start paying an estimated 7,800 former customers of Stanford Group Co.

 The court concluded that these victims did not qualify as "customers" eligible for compensation by SIPC, which liquidates failed brokerages. It upheld a July 2012 ruling by a federal district judge.

 SEC spokesman John Nester on Friday said in an email that the regulatory agency decided "after very careful deliberation" not to pursue the case further.

 He also said the SEC remains committed to Stanford's victims, and will work with the Stanford firm's receiver, the U.S. Department of Justice and others to maximize recoveries.

 Stanford, 64, is serving a 110-year prison term following his March 2012 conviction for running an estimated $7.2 billion fraud.

 The scheme was centered on bilking investors with fraudulent certificates of deposit issued by his Antigua-based Stanford International Bank.

 Angela Shaw Kogutt, founder of the Stanford Victims Coalition, called the SEC decision "a complete injustice" to Stanford victims.

 "Unfortunately, Stanford victims have no private right of action against SIPC," she said in an email. "The Commission has caved to an organization it is supposed to oversee."

 The case had been the first time the SEC had sued to force SIPC to start a court-supervised liquidation.

 While the SIPC has handled other big liquidations, including that of Bernard Madoff's former firm, it contended that Stanford's customers did not qualify for help because the Antigua bank was not a member of SIPC, unlike Texas-based Stanford Group.

 In ruling for SIPC, Circuit Judge Sri Srinivasan had written for the appeals court that "we fully agree" with the district court judge, who expressed that he had been "'truly sympathetic to the plight' of the victims." (Editing by Meredith Mazzilli and Jonathan Oatis)

Read more here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum http://sivg.org.ag/


Will SIPC's Brokerage Insurance Scam Help Allen Stanford Walk?

If you experience an insured loss and the insurance company doesn’t pay, you know you’ve been scammed. As I’ve discussed in a series of columns posted at www.kotlikoff.net, SIPC (the Securities Investor Protection Corporation) is running an enormous scam in claiming to insure our brokerage accounts against fraud. SIPC’s refusal to pay the legitimate claims of most Madoff victims and all Stanford victims makes this abundantly clear.

 Even worse, SIPC is placing all brokerage account holders at enormous additional risk by standing ready to sue them if they earn a return on their investments and spend the proceeds. In fact, thanks to precedents SIPC established in the Madoff case, SIPC can declare the loss of your securities to be the result of a Ponzi scheme and sue you for up to every dollar you withdrew in the up to six years prior to the fraud’s discovery!

 Reread that last sentence. It is saying that if you have made money investing with a broker, directly or indirectly, say through your IRA, you can not safely spend (or, indeed, withdraw and reinvest) your assets for up to six years from the time you’ve withdrawn them! But it is even worse than this. When you withdraw money from your IRA, you have to pay up to 40 percent in taxes. You can be sued for the amount you pay the IRS in taxes as well!

Read the full article here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum http://sivg.org.ag/


Wednesday, 3 September 2014

SEC Says Stanford's Criminal Conduct Charges 'Slanderous'

By David McAfee

The U.S. Securities and Exchange Commission on Wednesday urged a Texas federal judge to reject convicted Ponzi schemer Robert Allen Stanford’s call to appoint a special prosecutor and advise the court of criminal conduct by a court-appointed officer, calling his allegations “slanderous, sensational and unsupported.”
 The SEC says Stanford — who allegedly led a massive $7 billion Ponzi scheme by selling billions of dollars in self-styled certificates of deposit, promising return rates exceeding those offered by most banks — is falsely accusing the receiver and others of criminal conduct. Receiver Ralph Janvey was appointed to oversee Stanford International Bank Ltd. and its affiliated entities in February 2009, according to court documents.

 "Over the course of two weeks, Stanford filed three motions, which do nothing but make slanderous, sensational and unsupported allegations against the receiver, the Department of Justice, the commission and a circuit judge for the U.S. Court of Appeals for the Fifth Circuit," attorneys for the SEC wrote in their opposition brief. "Baldly accusing the court-appointed receiver of engaging in criminal conduct, Stanford appears to allege that the receiver’s actions, in collusion with the commission and the DOJ, prevented him from defending against the criminal action and resulted in his wrongful prosecution and conviction." 

Wednesday’s motion by the SEC marks the most recent development in the long-running case. The SEC said Stanford’s complaints about the criminal proceeding are “not relevant to this civil action” and should be addressed, if at all, on appeal of his criminal conviction.

 Janvey also responded to Stanford’s miscellaneous motions, including his bids for a temporary restraining order and an asset freeze, on Wednesday. Janvey said most of Stanford’s "frivolous pleadings" have previously been litigated.

 "There is no legal or factual basis either for the rambling and repetitive assertions contained in Stanford’s filings or for his requested relief," counsel for Janvey wrote in the response brief. "For all of these reasons, Stanford’s motions should be denied."

 The parties’ responses come more than a year after a Texas federal judge ruled in the commission’s favor, ordering Stanford to pay $6.76 billion for claims related to his alleged $7 billion securities fraud plot.

 U.S. District Judge David C. Godbey ordered Stanford to pay $6.76 billion to the SEC, a sum that includes the $5.9 billion the agency was originally looking for, plus $861 million interest. The ruling also rejected Stanford’s earlier argument that he should be able to continue challenging the validity of the civil case, which is based on information from his criminal conviction, because he claims he didn’t get a full and fair opportunity to defend himself at trial.

 The judge said the SEC was entitled to summary judgment because both the criminal and civil cases involve the same facts, which had already been litigated in the government’s favor during Stanford’s criminal proceedings.

 Stanford was sentenced in March 2012 to 110 years in prison after being convicted on charges he misappropriated billions of dollars in investor funds, including some $1.6 billion he allegedly moved to a personal account.

 All told, Stanford and his Houston-based company misused and misappropriated about $7 billion in certificates of deposit purchased by investors and administered by Stanford International Bank, according to the prosecutors.

 The SEC went after him too, filing a suit in the Northern District of Texas basing its arguments on information from Stanford’s criminal conviction.

 The SEC is represented by B. David Fraser and David B. Reece of the SEC.

 Receiver Ralph S. Janvey is represented by Kevin M. Sadler, Scott D. Powers, David T. Arlington and Timothy S. Durst of Baker Botts LLP.

 Robert Allen Stanford is representing himself.

 The case is Securities and Exchange Commission v. Stanford International Bank Ltd. et al., case number 3:09-cv-00298, in the United States District Court for the Northern District of Texas, Dallas Division.

Read more here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum http://sivg.org.ag/


Wednesday, 27 August 2014

Allen Stanford's Motion to Vacate lodged on 24th April 2014 Raises Interesting Issues

As many of you may know Allen Stanford appealed his conviction on 24th April 2014.

In his "Motion to Vacate" Allen Stanford has cited various reasons not least of which that the CDs were regulated only in the sovereign nation of Antigua and that the SEC had no jurisdiction and no authority to go after him. 

Should Allen Stanford successful in his argument its conceivable that it could have implications for any appeal by the SEC against SIPC and also in the lawsuit that KLS is bringing against the SEC.

The Motion to Vacate makes interesting reading whether you agree with Stanford's assertions or not and could potentially affect victims entitlements should Stanford be successful.

Some of the more interesting claims made in Stanford's "Motion to Vacate" which you may or may not agree with are:


  • The SEC had no jurisdictional or regulatory authority over SIB. 
  • Allen Stanford was denied due Process, and the venue for their complaint was improper. 
  • There was a blatant violation of Stanford’s Fourth Amendment right to protection from illegal search and seizure. 
  • Fraud upon de Court in this matter 

The report by Ms Van Tassel is also called into question. When questioned Ms Tassel had experience in only two other matters that involved ponzi schemes, one involved a computer re-seller where no written report was submitted and a second involving real estate.
Ms Van Tassel was Senior Managing director of FTI Consulting which was not a CPA firm and her company was unlicensed (in Texas) to perform the work it performed.

You can read the Allen Stanford's "Motion to Vacate" HERE 


For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum http://sivg.org.ag/


Monday, 25 August 2014

Cassidy: SEC should appeal ruling against Stanford victims

Rep. Bill Cassidy, R-Baton Rouge, is asking Securities and Exchange Commission Chair Mary Jo White to appeal a D.C. Court of Appeals ruling that victims of the Stanford Ponzi scheme aren't eligible for compensation from a fund established by the Securities Investor Protection Corp.

The court ruled that the losses, painful as they were, came from foreign certificates of deposit issued by banks that aren't part of the corporation's industry members who fund the account to reimburse victims of financial fraud.

In 2012, Allan Stanford, the former board of directors chairman of Stanford International Bank (SIB), was sentenced to 110 years in prison for what the federal government said was orchestrating a 20-year investment fraud scheme in which he misappropriated $7 billion to finance his personal businesses. Many of the victimized investors are from Baton Rouge and Lafayette.

The SEC had urged the Investor Protection Corporation to reimburse Stanford victims for some of their losses. The corporation refused, and an appeals court found that it had valid reasons to reject the payouts. 

"Stanford Victims' financial futures have been damaged by the Ponzi scheme, and now threatened by SEC inaction," said Cassidy, a candidate for the U.S. Senate. "Since similar cases have ruled in victims' favors, I urge the SEC to appeal the U.S. Court of Appeals ruling. The Stanford Ponzi Scheme devastated many Louisiana families, we must do all we can to help these families achieve justice."

Read more here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum http://sivg.org.ag/


Saturday, 23 August 2014

KLS Stanford Update August 21, 2014

KACHROO LEGAL SERVICES, P.C.

TO ALL KLS SEC CLIENTS


 Dear Stanford Clients:

We write to update you on the progress of the claim against the Securities and Exchange Commission. As communicated in our previous update, Kachroo Legal Services, P.C. (the “Firm”) submitted its appeal on behalf of all clients to the Eleventh Circuit Court of Appeals in February. In response, the United States filed its Appellee’s Brief on March 10, 2014.

Thereafter, on March 27, 2014, in direct response to the Appellee’s Brief, the Firm prepared and submitted on behalf of all clients a Reply Brief. The Reply Brief addressed specific issues raised by the Government and focused specifically on the following points:


  1. The SEC’s alleged failure to adequately perform an operational task, which is not subject to the misrepresentation exception of the Federal Tort Claims Act;
  2. That the SEC’s alleged breach was of a duty to warn and not communicate with due care; and
  3. The Government’s interpretation of the amended registration process is flawed.

The Court has ordered oral arguments in this case which will occur at the 11th Circuit Court of Appeals on September 11, 2014. KLS will continue its work in preparing for the hearing and will update all clients thereafter.

Once oral argument is complete, we shall await the Court’s judgment and shall keep all clients updated. As ever, if you have any questions, please do not hesitate to contact us.

Very truly yours,

KLS Stanford Team
Kachroo Legal Services, P.C.



Read more here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum http://sivg.org.ag/


Friday, 22 August 2014

APPEALS COURT AGAIN REBUFFS ALLEN STANFORD


Convicted Ponzi schemer/banker R Allen Stanford, who is appealing* his conviction, Pro Se, has filed what he captioned "Motion to the Court for the Appointment of a Qualified Law Clerk."

Stanford's initial brief is due on September 16, 2014; He must file it by that date. Stanford, in his motion, which includes legalese that indicates it was most likely ghost written by another inmate, states:

"Stanford's only remaining concern is that he adheres to, and complies with, any and all of this Court's requirements on submission. Therefore, he now respectfully requests that this Court appoint a qualified law clerk to review his appeal and make certain that it comports to all requirements." (Motion at 1-2).''

The Clerk of the Fifth Circuit Court of Appeals not only did not present this motion to the judges, he promptly sent a terse memorandum to Stanford:

"The Court will take no action on your Motion for Appointment of a Qualified Law Clerk, as this Court does not provide such relief."

Is he actually asking that the judge have one of his law clerks, who are new attorneys that assist the court in case management, assist him ? This has to be the height of arrogance; Stanford asked to proceed Pro Se, and now he is saying that he cannot handle the appeal. Why don't some of his friends, business associates, or family get him a lawyer ? Where is all that money ?

Given that any review of the brief would entail experience with the Federal Rules of Appellate Procedure, the Fifth Circuit Local Rules, and the fundamentals of brief writing, only an appellate attorney, who has experience practicing in the 5th Circuit, would be satisfactory, in my humble opinion. Is Stanford seeking to create grounds for a further appeal, in the event that the one appeal that he has as a matter of right will probably not succeed ? We cannot say, but no Federal Judge is going to create the right to a law clerk in a Pro Se appeal, where none exists in the statutes, or case law.

Stanford is on his last possible extension for the brief, as the Court has already stated that "no further enlargements [extensions of time] will be given." Furthermore, his request to file a brief in excess of the page limit has been denied. The wheels of justice are about to move forward in his case, whether he likes it or not.

Read more here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum http://sivg.org.ag/


Tuesday, 19 August 2014

SIPC's Brokerage Insurance Scam of Allen Stanford's Victims -- Another Reason to Close Your Brokerage Account Now!

Imagine you invest with a broker whose front doors, office plaques, coffee mugs, pencils, brochures, stationery, folders, office signage, and emails all proclaim that your investments are insured by SIPC – Wall Street’s so-called “Securities Investor Protection Corporation.”

Your broker tells you the stock market is overvalued. But he has a very safe, moderate-yield investment opportunity that entails purchasing certificates of deposits.

You like and trust your broker, and maybe have a long history with him. And CDs? Well, everyone knows that CDs are very safe. So you agree with your broker—he’s the expert after all. Indeed, since your brokerage firm, Firm X, is managing all your investments and since you just retired, you decide, at your broker’s urging, to put all your money into Firm X’s CDs–even your IRA funds.

The next day, the next month, or maybe the next year your brokerage firm goes under due to fraud. None of the money you spent on Firm X’s CDs, you learn, was actually invested in other securities to produce a return on Firm X’s CD. Instead, your money was stolen. It was used to pay the brokerage Firm X’s bills, including incredibly lavish salaries for its top brass.

You’re totally devastated. All your retirement savings, which you spent your entire working life accumulating, just went up in smoke. But there’s one silver lining – SIPC, with its promise of up to $500,000 of brokerage account protection.

You call up SIPC and request your insurance payment........................


The full article can be read  here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum http://sivg.org.ag/


Tuesday, 12 August 2014

Mississippi GOP federal delegation calls on SEC to appeal ponzi scheme ruling

RELEASE: Miss. Delegation Members Call for SEC to Appeal Ponzi Scheme Ruling

WASHINGTON – Members of Mississippi’s congressional delegation, including U.S. Senators Thad Cochran, R-Miss., and Roger Wicker, R-Miss., and U.S. Representatives Gregg Harper, R-Miss., Alan Nunnelee, R-Miss., and Steven Palazzo, R-Miss., today called on Securities and Exchange Commission (SEC) Chair Mary Jo White to appeal a recent ruling by the U.S. Court of Appeals regarding the Ponzi scheme perpetrated by R. Allen Stanford.

The court found that thousands of investors who were cheated in this Ponzi scheme, including many Mississippians, are not eligible for financial compensation.

The full text of the letter can be read  here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum http://sivg.org.ag/


Saturday, 2 August 2014

Judge Won't Compel Arbitration in Stanford Case

U.S. District Judge David Godbey of Dallas has ruled that the receiver he appointed to recover millions of dollars taken in R. Allen Stanford "massive Ponzi scheme" cannot be compelled into arbitration to collect funds the now-imprisoned Houston financier paid stockbrokers who worked for his companies.

To do otherwise, Godbey ruled in a July 30 order in the highly litigated Ralph S. Janvey v. James R. Alguire, "would frustrate a central purpose of federal equity receivership's."

Godbey has presided over litigation involving the U.S. Securities and Exchange Commission's civil receivership action over Stanford-related entities for more than five years. Stanford is currently serving a 110-year prison sentence after a Houston federal jury convicted him of fraud for running the Ponzi scheme. Stanford has appealed.

Early in the receivership action, Godbey appointed Ralph S. Janvey, a partner in Dallas' Krage & Janvey, to serve as receiver over the Stanford entities to trace any assets owned by the receivership estate. Janvey then sued numerous former employees of the Stanford entities to recover the funds, but more than 100 stockbrokers filed motions to compel arbitration in the case, pointing to agreements they signed with Stanford.

Read more here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum http://sivg.org.ag/


Friday, 1 August 2014

Congress Needs to Act Now to Protect Investors from SIPC “Insurance”

On September 25, 2000, eight years before the scams of Bernard Madoff and R. Allen Stanford were uncovered, Gretchen Morgenson (financial journalist for the New York Times) wrote a perceptive column of exacting detail describing the Securities Investor Protection Corporation’s pinched and adversarial practices aimed at favoring the SIPC Fund over protecting innocent customers of failed broker dealers. That column was “dead on” concerning SIPC’s regrettable culture, in which litigation rather than protection is too often the order of the day.

As Comptroller of the Currency (our nation’s oldest bank supervisory agency) in the turbulent economy of the mid-70s, I worked closely with the FDIC in the resolution of many failed banks. The efficiency and fairness with which it fulfilled its guaranteed protection of depositors was always impressive. Equally admirable is its practice of reserving its considerable legal resources for recovery actions against wrongdoers-not the victimized customers.

It is a shame that none of us heeded Ms. Morgenson’s warning entitled, “INVESTOR BEWARE; Many Holes Weaken Safety Net for Victims of Failed Brokerages.” I feel particularly at fault, having had an active role in the enactment of the Securities Investor Protection Act in 1970. Then serving as Special Assistant for Legislative Affairs to Secretary of the Treasury David Kennedy, my associates and I worked in cooperation with the SEC, Congressional committee staffs, key Members of the House and Senate, and leaders of the securities industry to develop the statutory content of SIPA. We were moving expeditiously as the industry had suffered a rash of broker-dealer failures and we were gravely concerned that non-professional, rank and file investors were abandoning securities investment so extensively that the fundamental market function was vulnerable to complete collapse.

Read more here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum http://sivg.org.ag/


Thursday, 31 July 2014

Court: No protection agency funds for Stanford victims



The Securities Investor Protection Corp.’s emergency fund is not available to people who were fleeced of billions of dollars by Houston swindler Robert Allen Stanford, an appellate court has ruled.

The decision by the U.S. Circuit Court of Appeals for the District of Columbia rocked people who invested with Stanford’s companies from Baton Rouge to the Atlantic and Pacific coasts.

 “Nobody takes any great pleasure in this,” SIPC President Stephen Harbeck said Monday. “But this was just outside the scope of the (SIPC) law.”

 SIPC was created by Congress in 1970 to protect investor money placed with brokerages that failed without ever having purchased the securities selected by their customers. SIPC’s member brokers pay annual fees into the safety net intended to protect such investors.

Stanford, 64, is serving a 110-year prison term for his 2012 conviction on multiple counts of mail and wire fraud related to between $5.5 billion and $7 billion in losses by more than 20,000 investors in the U.S. and more than 100 other countries.

Stanford’s victims won’t get any SIPC relief the way victims of New York swindler Bernard Madoff did. Madoff confessed in 2008 to stealing more than $17 billion from his investors over a period of decades and is serving a 150-year prison term.

Read the Full Transcript here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum http://sivg.org.ag/