Antigua has taken the assets of Allen Stanford that were paid for and seized them.
The Antiguan government has made it clear it does not intend to pay a penny for the assets even though they were paid for by the victims of Stanford's massive fraud aided and abetted by the Antiguan government.
The government now has the luxury of selling those assets a second time thus getting paid twice while the poor victims of Stanford get nothing.
Similarly the loans made by Stanford to the Antiguan government for the hospital, the library and to the bank of Antigua have now been wiped from the books again depriving Stanford's victims of money that is rightfully theirs.
Do the victims of Stanford get sympathy from the people and government of Antigua? No, they are told to take their passports and leave the island. They are accused of being greedy and foolish to invest in an offshore bank. Perhaps the government should remember it was their duty to oversee the banks on Antigua and it was their failure to do so that has cost 28,000 depositors from around the world their life savings.
If the investors were foolish it was to trust the morally bankrupt island of Antigua and it's government.
. Antigua received funds from the criminal proceeds of the Stanford Enterprises.
. Antigua deceived the SEC for the purpose of perpetuating the Stanford Enterprise and enriching itself.
. Antigua has misappropriated assets belonging to the Stanford Entities and, in so doing deprived the Class of assets that should be available to satisfy their claims against the Stanford Entities.
. Antigua conspired with the Stanford Co-Conspirators to perpetrate the fraud.
. Antigua aided and abetted the fraud committed by the Stanford Co-Conspirators.
Saturday, 31 October 2009
Stanford receiver pinpoints $1.5bn
Investors in Sir Allen Stanford’s alleged $7bn Ponzi scheme may be able to recover about one-fifth of their principal, according to the receiver appointed by the US courts to administer the estate’s assets.
Sir Allen, who is facing a criminal indictment as well as a civil suit filed by the Securities and Exchange Commission, has denied all the allegations against him.
In a report filed late on Wednesday, Dallas lawyer Ralph Janvey said cash on hand at the Stanford estate totalled $128.8m, and that he was trying to recover a further $894m.
“We have identified over $1.5bn in assets that ultimately could be available to the victims of the Stanford fraud,” he said in a statement. “We may be able to return to them as much as 20 cents on the dollar, just based on activities to date.”
Mr Janvey has been aggressive in his attempts to recover cash and other assets of the complex Stanford empire, which stretched from Houston to Venezuela.
The epicentre of the alleged fraud – Stanford International Bank, which issued high-yielding certificates of deposit to investors around the world – was domiciled in Antigua.
Among the assets listed was Sir Allen’s yacht, the Sea Eagle, which the Texan businessman bought for $3.9m and on which he spent an additional $16m in “upgrades” such as replacing the teak interior with mahogany and putting in a new galley kitchen, according to court papers.
Some of the receiver’s methods – which have included attempts to claw back principal and interest from victims of the alleged fraud and to recoup money paid to former employees – have irked the SEC. The regulator has accused Mr Janvey of overstepping his authority in the matter.
The receiver has also faced criticism regarding his fee requests. Mr Janvey has billed the estate for more than $35m to date, according to court documents. The sum covers the services provided by the receiver and the small army of lawyers, consultants and forensic accountants assisting in the recovery effort, which began in February.
According to the report, more than 40 per cent of the cash on hand has been allocated towards covering those operational and professional expenses.
John Little, the examiner appointed to represent the interests of the Stanford investors, has objected to Mr Janvey’s requests, noting the fees will have to be paid out of the limited cash pool that will ultimately be used to reimburse depositors. Mr Little opposed the receiver’s clawback requests on similar grounds, saying the costs of litigation would likely outstrip the cash recovered.
Kent Shaffer, Sir Allen’s criminal defence attorney, told the Financial Times the receiver and his colleagues were “looting the revenues” of the Stanford companies.
Mr Janvey told the FT the criticisms were “simply part of a tired and fruitless effort to shift attention away from Stanford, who is responsible for a worldwide multibillion dollar financial fraud that has hurt tens of thousands of people”.
Sir Allen, who is facing a criminal indictment as well as a civil suit filed by the Securities and Exchange Commission, has denied all the allegations against him.
In a report filed late on Wednesday, Dallas lawyer Ralph Janvey said cash on hand at the Stanford estate totalled $128.8m, and that he was trying to recover a further $894m.
“We have identified over $1.5bn in assets that ultimately could be available to the victims of the Stanford fraud,” he said in a statement. “We may be able to return to them as much as 20 cents on the dollar, just based on activities to date.”
Mr Janvey has been aggressive in his attempts to recover cash and other assets of the complex Stanford empire, which stretched from Houston to Venezuela.
The epicentre of the alleged fraud – Stanford International Bank, which issued high-yielding certificates of deposit to investors around the world – was domiciled in Antigua.
Among the assets listed was Sir Allen’s yacht, the Sea Eagle, which the Texan businessman bought for $3.9m and on which he spent an additional $16m in “upgrades” such as replacing the teak interior with mahogany and putting in a new galley kitchen, according to court papers.
Some of the receiver’s methods – which have included attempts to claw back principal and interest from victims of the alleged fraud and to recoup money paid to former employees – have irked the SEC. The regulator has accused Mr Janvey of overstepping his authority in the matter.
The receiver has also faced criticism regarding his fee requests. Mr Janvey has billed the estate for more than $35m to date, according to court documents. The sum covers the services provided by the receiver and the small army of lawyers, consultants and forensic accountants assisting in the recovery effort, which began in February.
According to the report, more than 40 per cent of the cash on hand has been allocated towards covering those operational and professional expenses.
John Little, the examiner appointed to represent the interests of the Stanford investors, has objected to Mr Janvey’s requests, noting the fees will have to be paid out of the limited cash pool that will ultimately be used to reimburse depositors. Mr Little opposed the receiver’s clawback requests on similar grounds, saying the costs of litigation would likely outstrip the cash recovered.
Kent Shaffer, Sir Allen’s criminal defence attorney, told the Financial Times the receiver and his colleagues were “looting the revenues” of the Stanford companies.
Mr Janvey told the FT the criticisms were “simply part of a tired and fruitless effort to shift attention away from Stanford, who is responsible for a worldwide multibillion dollar financial fraud that has hurt tens of thousands of people”.
Stanford receiver shoots for $1.5B target
Investors who lost money in the alleged Ponzi scheme run by R. Allen Stanford would stand to share as much as $1.5 billion, if the court-appointed receiver gets the unfettered access to numerous assets he has been seeking for months.
According to documents filed with U.S. District Court this week, Dallas attorney Ralph Janvey hopes to be able to pay back as much as 20 cents on the dollar to defrauded investors.
So far, the documents said, $128.8 million in cash has been collected, of which $71.5 million remains after expenses.
Other assets under Janvey’s control include private equity, the Stanford Bank of Panama, $5 million in coins and bullion, domestic real estate and Stanford’s personal property, including private aircraft, Stanford’s $3.9 million yacht and vehicles. Another $335 million in foreign accounts is on Janvey’s hit list, but so far only Canadian courts have sided with the receiver and no other definitive action to release any of those funds is under way.
Janvey expects the pending sale of the Bank of Panama to fetch about $13.5 million
Many of the assets are subject to other lawsuits from outside investors that could affect the receiver’s ability to reach the $1.5 billion goal. Janvey is awaiting word from federal appeals court on approval of a plan to go after $1 billion in claw-back claims against former Stanford defendant investors, brokers and managing directors.
With those question marks in mind, Janvey himself noted in the court document that “the ultimate success of these efforts is necessarily uncertain ....”
Janvey and his team of attorneys and consultants have been paid about $21 million so far for their work on the case.
Stanford is under lock and key in Houston awaiting trial for allegedly orchestrating a $7 billion Ponzi scheme using certificates of deposit issued through a bank in Antigua under his control, that authorities say Stanford used to support his lavish lifestyle.
According to documents filed with U.S. District Court this week, Dallas attorney Ralph Janvey hopes to be able to pay back as much as 20 cents on the dollar to defrauded investors.
So far, the documents said, $128.8 million in cash has been collected, of which $71.5 million remains after expenses.
Other assets under Janvey’s control include private equity, the Stanford Bank of Panama, $5 million in coins and bullion, domestic real estate and Stanford’s personal property, including private aircraft, Stanford’s $3.9 million yacht and vehicles. Another $335 million in foreign accounts is on Janvey’s hit list, but so far only Canadian courts have sided with the receiver and no other definitive action to release any of those funds is under way.
Janvey expects the pending sale of the Bank of Panama to fetch about $13.5 million
Many of the assets are subject to other lawsuits from outside investors that could affect the receiver’s ability to reach the $1.5 billion goal. Janvey is awaiting word from federal appeals court on approval of a plan to go after $1 billion in claw-back claims against former Stanford defendant investors, brokers and managing directors.
With those question marks in mind, Janvey himself noted in the court document that “the ultimate success of these efforts is necessarily uncertain ....”
Janvey and his team of attorneys and consultants have been paid about $21 million so far for their work on the case.
Stanford is under lock and key in Houston awaiting trial for allegedly orchestrating a $7 billion Ponzi scheme using certificates of deposit issued through a bank in Antigua under his control, that authorities say Stanford used to support his lavish lifestyle.
Wednesday, 28 October 2009
Stanford victims want US to block Antigua money
Chairman of the Antigua Labour Party Gaston Browne said efforts by a group of United States investors to sue the local government over the Sir Allen Stanford matter is out of line.
“That case is not a justifiable one, the investors had a private contract with Stanford, they don’t have any contractual agreement between themselves and the government and for them now to look for the government to pay them is absolute nonsense.”
The Stanford Victims Coalition and the law firm Morgenstern & Blue sent a letter on Friday to over 50 US senators and congressmen asking them to block Antigua from receiving any funding from the IMF, this according to a report in another news medium.
According to the article, Antigua’s involvement in the alleged US$7.2 billion Stanford International Bank scandal is one example of the country’s alleged history of corruption.
In the article, it is alleged that this fraud led to the losses of life’s savings belonging to 28,000 victims from around the world, it also indicated that the country is accused of profiting from its relationship with Stanford for many years and now it has taken steps to expropriate properties that were purchased with up to US$1 billion of investors funds.
Browne said the government of Antigua and Barbuda should not be on the losing end of this debacle, as the government did not have any contractual agreement with the investors.
He, however, added that the Antiguan government should not have acquired those real estate properties belonging to Sir Allen in the wholesale manner in which they did as forewarned by the opposition party.
“We had said to them for instance when we went to Parliament that if there were strategic assets like around the airport that they needed to acquire for expansion and soon, that would be satisfactory, but for them to acquire other assets which evidently is of no particular interest to the development of Antigua and Barbuda is creating a liability for the government.”
The Party chairman said those assets were part of the receivership estate and should have been shared among the creditors.
Efforts to contact Minister of Finance Harold Lovell for comment proved futile as he was engaged in a series of meetings.
“That case is not a justifiable one, the investors had a private contract with Stanford, they don’t have any contractual agreement between themselves and the government and for them now to look for the government to pay them is absolute nonsense.”
The Stanford Victims Coalition and the law firm Morgenstern & Blue sent a letter on Friday to over 50 US senators and congressmen asking them to block Antigua from receiving any funding from the IMF, this according to a report in another news medium.
According to the article, Antigua’s involvement in the alleged US$7.2 billion Stanford International Bank scandal is one example of the country’s alleged history of corruption.
In the article, it is alleged that this fraud led to the losses of life’s savings belonging to 28,000 victims from around the world, it also indicated that the country is accused of profiting from its relationship with Stanford for many years and now it has taken steps to expropriate properties that were purchased with up to US$1 billion of investors funds.
Browne said the government of Antigua and Barbuda should not be on the losing end of this debacle, as the government did not have any contractual agreement with the investors.
He, however, added that the Antiguan government should not have acquired those real estate properties belonging to Sir Allen in the wholesale manner in which they did as forewarned by the opposition party.
“We had said to them for instance when we went to Parliament that if there were strategic assets like around the airport that they needed to acquire for expansion and soon, that would be satisfactory, but for them to acquire other assets which evidently is of no particular interest to the development of Antigua and Barbuda is creating a liability for the government.”
The Party chairman said those assets were part of the receivership estate and should have been shared among the creditors.
Efforts to contact Minister of Finance Harold Lovell for comment proved futile as he was engaged in a series of meetings.
Stanford Ailing, but in court
R. Allen Stanford appeared ill during a court appearance Wednesday as lawyers discussed possible trial dates for him and others accused of running a $7 billion fraud.
Stanford was thinner than in previous appearances. He spit blood into a water cup while sitting in court. Senior U.S. District Judge David Hittner asked Stanford if he needed attention, but he said he was all right.
“It's some sort of illness, we're not sure what,” said his lawyer, Kent Schaffer . He said his client speaks to no one but prison guards and his lawyers, and it's taking an emotional and physical toll.
Stanford has had surgery for an aneurysm in his leg since he was jailed and was hospitalized after a fight with another inmate. He is being held without bail as a possible flight risk because of international connections and ability to get funds.
Schaffer complained about Stanford's treatment in the downtown Houston Federal Detention Center, saying he's held in solitary confinement, isn't getting adequate medical attention and can't see or phone his family.
A spokesman for the federal Bureau of Prisons could not be reached for comment on that claim.
Stanford, a Texas native who has lived mostly in the Caribbean for many years, founded Houston-based Stanford Financial Group. He faces 21 counts of conspiracy, fraud, bribery and obstruction of justice.
He and co-defendants are accused of cheating investors who bought certificates of deposit issued by Stanford International Bank on the Caribbean island of Antigua, and sold through Stanford Financial Group companies.
Three of Stanford's codefendants are free on bail and wore street clothes for Wednesday's court hearing, while their ex-boss sat nearby shackled and in green jail clothes.
Lawyers on both sides estimated the trial could take four months. Prosecutor Gregg Costa asked for a trial date no later than next October.
Research time a concern
But defense lawyers said they haven't had time to dig into the government's 5 million pages of documents and need weeks before they even know when they can be prepared for trial.
Mike Sokolow, the public defender appointed to handle Stanford's case, officially withdrew Wednesday. Schaffer, a private lawyer also appointed, said he will stay on now that a Dallas judge overseeing a civil fraud case against Stanford and others has said an insurer can pay for their defense.
Others likely covered
Stanford's criminal co-defendants who appeared in court Wednesday — former Stanford company executives Laura Holt, Gilbert Lopez and Mark Kuhrt — also should be covered by the company insurance policy.
Costa said the fifth defendant, Leroy King, a bank regulator in Antigua, is under house arrest there and the government hopes he will be extradited in time to participate in the trial.
Stanford was thinner than in previous appearances. He spit blood into a water cup while sitting in court. Senior U.S. District Judge David Hittner asked Stanford if he needed attention, but he said he was all right.
“It's some sort of illness, we're not sure what,” said his lawyer, Kent Schaffer . He said his client speaks to no one but prison guards and his lawyers, and it's taking an emotional and physical toll.
Stanford has had surgery for an aneurysm in his leg since he was jailed and was hospitalized after a fight with another inmate. He is being held without bail as a possible flight risk because of international connections and ability to get funds.
Schaffer complained about Stanford's treatment in the downtown Houston Federal Detention Center, saying he's held in solitary confinement, isn't getting adequate medical attention and can't see or phone his family.
A spokesman for the federal Bureau of Prisons could not be reached for comment on that claim.
Stanford, a Texas native who has lived mostly in the Caribbean for many years, founded Houston-based Stanford Financial Group. He faces 21 counts of conspiracy, fraud, bribery and obstruction of justice.
He and co-defendants are accused of cheating investors who bought certificates of deposit issued by Stanford International Bank on the Caribbean island of Antigua, and sold through Stanford Financial Group companies.
Three of Stanford's codefendants are free on bail and wore street clothes for Wednesday's court hearing, while their ex-boss sat nearby shackled and in green jail clothes.
Lawyers on both sides estimated the trial could take four months. Prosecutor Gregg Costa asked for a trial date no later than next October.
Research time a concern
But defense lawyers said they haven't had time to dig into the government's 5 million pages of documents and need weeks before they even know when they can be prepared for trial.
Mike Sokolow, the public defender appointed to handle Stanford's case, officially withdrew Wednesday. Schaffer, a private lawyer also appointed, said he will stay on now that a Dallas judge overseeing a civil fraud case against Stanford and others has said an insurer can pay for their defense.
Others likely covered
Stanford's criminal co-defendants who appeared in court Wednesday — former Stanford company executives Laura Holt, Gilbert Lopez and Mark Kuhrt — also should be covered by the company insurance policy.
Costa said the fifth defendant, Leroy King, a bank regulator in Antigua, is under house arrest there and the government hopes he will be extradited in time to participate in the trial.
Tuesday, 27 October 2009
Baroness Kinnock and Foreign Office ignore Pleas to implement Treaty
Baroness Kinnock and the Foreign office have turned their backs on the British victims of Allen Stanford's massive fraud by failing to implement the treaty that is held "Between the Government of Antigua and the Government of the United Kingdom For the Promotion and Protection of Investments".
The agreement exists between the two countries and promises restitution for anyone who looses money or investments between these two countries. Information contained in the documents make it clear that both governments are making a promise to recompense investors who have lost money, especially where property or assets have been seized, as in the case of Allen Stanford.
The agreement exists between the two countries and promises restitution for anyone who looses money or investments between these two countries. Information contained in the documents make it clear that both governments are making a promise to recompense investors who have lost money, especially where property or assets have been seized, as in the case of Allen Stanford.
Baroness Kinnock Refuses to help the British Victims of Allen Stanford's Massive Fraud
Letter to Dr Taylor regarding Baroness Kinnock's failure to understand or Implement the UK/Antigua Treaty. Dr Taylor has been a staunch supporter of Stanfords British victims.
Dear Dr Taylor,
Thank you for your diligence with this matter. I have to say that I was rather shocked by Mrs. Kinnocks reply, and would appreciate it if you would please forward a copy of this email to her.
I know many members of the Stanford Victims Coalition that have written to the Foreign Office and I have seen the standard responses and replies they have received. Mrs. Kinnock is incorrect to say they have only received one other letter from a couple. Either Mrs. Kinnock is not being kept informed, she has not taken on board the letters that have been sent, or the letters are not being dealt with by the same people.
According to the records from the UK Receiver in Antigua (Vantis), there are 200 British Citizens that have lost their life savings through Stanford International Bank. I do not have the amount of money involved, but it will be quite substantial.
Can I direct you to my blog site "Stanford's Forgotten Victims" http://stanfordsforgottenvictims.blogspot.com/ and ask Mrs. Kinnock to also take a look at the information that is on my blog. Also go to the "Stanford Victims Coalition forum" http://fraudsvictims.com/forums/index.php and read what has been happening there. If she wants to find details of exactly who from that site has been in contact with the Foreign Office, she only has to put a posting on there and she will receive all the information she wants.
I would again like to point out to Mrs. Kinnock (as I have repeatedly said in my previous emails) that the Treaty is between the two governments, i.e., Antigua and the United Kingdom, and as such it is the responsibility of the two governments to implement the Treaty. I as a citizen of the United Kingdom CANNOT implement it. I have spoken to several lawyers about this and they have confirmed that the United Kingdom Government have to approach Antigua about honoring the agreement, I repeat, I cannot do it as I have no authority in the Treaty and did not make the agreement with Antigua.
As you are no doubt aware the Antigua Government have seized lands that were once owned by Allen Stanford and his companies and paid for with depositors money. The Antigua Government have after 6 months made no attempt to pay for these lands and assets to allow money to be redirected back to the real victims of this crime - the depositors.
I am very disappointed that the Foreign Office seems to think that by sending out mundane non committal responses that we the victims of this crime will go away. I worked and saved for over 40 years, saw my late husband die thinking he had left me well provided for, paid all my taxes and led a frugal and honest life to make sure I would not be in penury in my old age. After all the taxes, all the saving, all the time I lived a decent life and supported my country I deserve to be heard now and I deserve to be assisted in this matter, not fobbed off.
Mrs. Kinnock, please take note, I have looked into this matter, I have sought legal advise and I now expect the Foreign Office to act on my behalf and start asking questions to the Antigua Government about how they intend to honor this Treaty. If the UK is not prepared to follow up on this matter, what was the point of preparing, and signing it in the first place.
I trust Mrs. Kinnock that you will give this matter your fullest support and deal with it in a way that you would like to be dealt with if you were unfortunate enough to find your life savings stolen from you.
Dear Dr Taylor,
Thank you for your diligence with this matter. I have to say that I was rather shocked by Mrs. Kinnocks reply, and would appreciate it if you would please forward a copy of this email to her.
I know many members of the Stanford Victims Coalition that have written to the Foreign Office and I have seen the standard responses and replies they have received. Mrs. Kinnock is incorrect to say they have only received one other letter from a couple. Either Mrs. Kinnock is not being kept informed, she has not taken on board the letters that have been sent, or the letters are not being dealt with by the same people.
According to the records from the UK Receiver in Antigua (Vantis), there are 200 British Citizens that have lost their life savings through Stanford International Bank. I do not have the amount of money involved, but it will be quite substantial.
Can I direct you to my blog site "Stanford's Forgotten Victims" http://stanfordsforgottenvictims.blogspot.com/ and ask Mrs. Kinnock to also take a look at the information that is on my blog. Also go to the "Stanford Victims Coalition forum" http://fraudsvictims.com/forums/index.php and read what has been happening there. If she wants to find details of exactly who from that site has been in contact with the Foreign Office, she only has to put a posting on there and she will receive all the information she wants.
I would again like to point out to Mrs. Kinnock (as I have repeatedly said in my previous emails) that the Treaty is between the two governments, i.e., Antigua and the United Kingdom, and as such it is the responsibility of the two governments to implement the Treaty. I as a citizen of the United Kingdom CANNOT implement it. I have spoken to several lawyers about this and they have confirmed that the United Kingdom Government have to approach Antigua about honoring the agreement, I repeat, I cannot do it as I have no authority in the Treaty and did not make the agreement with Antigua.
As you are no doubt aware the Antigua Government have seized lands that were once owned by Allen Stanford and his companies and paid for with depositors money. The Antigua Government have after 6 months made no attempt to pay for these lands and assets to allow money to be redirected back to the real victims of this crime - the depositors.
I am very disappointed that the Foreign Office seems to think that by sending out mundane non committal responses that we the victims of this crime will go away. I worked and saved for over 40 years, saw my late husband die thinking he had left me well provided for, paid all my taxes and led a frugal and honest life to make sure I would not be in penury in my old age. After all the taxes, all the saving, all the time I lived a decent life and supported my country I deserve to be heard now and I deserve to be assisted in this matter, not fobbed off.
Mrs. Kinnock, please take note, I have looked into this matter, I have sought legal advise and I now expect the Foreign Office to act on my behalf and start asking questions to the Antigua Government about how they intend to honor this Treaty. If the UK is not prepared to follow up on this matter, what was the point of preparing, and signing it in the first place.
I trust Mrs. Kinnock that you will give this matter your fullest support and deal with it in a way that you would like to be dealt with if you were unfortunate enough to find your life savings stolen from you.
Receiver sues Stanford employees for $11 million
The receiver overseeing the assets of accused swindler Allen Stanford has sued two former Stanford Capital Management employees, seeking the return of $11 million in investor funds, court documents showed.
The lawsuit, filed on Wednesday in Dallas federal court, accuses Stanford and his co-defendants in an alleged $7 billion Ponzi scheme of transferring the funds of defrauded investors to Christopher Aitken and Stephen Thacker to hide it from creditors.
Aitken and Thacker, who received the funds when they joined the firm in November of 2008, were employed for only three months and left "no indication that they provided any meaningful services," the lawsuit said.
Aitken received $8.7 million and Thacker $2.6 million as a partial payment for "personal goodwill" or the "personal relationships (they) have developed and maintained with clients," the suit said.
Ralph Janvey, the receiver in the case, says the men have no legitimate claim to the funds, which must be returned to help make victims of the fraud whole.
Lawyers for Aitken and Thacker could not be located immediately for comment. Stanford's attorney could not be reached for comment.
Janvey asked the judge to seize the funds and hold them in a trust while his investigation is under way.
Stanford, 59, and his former top aides James Davis and Laura Pendergest-Holt are accused of selling fraudulent certificates of deposit issued by Stanford's offshore bank, and of bribing regulators and accountants in Antigua to ignore the alleged wrongdoing.
Davis, Stanford Financial Group's former chief financial officer, has pleaded guilty to his role in the alleged scheme. Stanford and Pendergest-Holt, Stanford Financial Group's former chief investment officer, have pleaded not guilty.
Three others were also charged and pleaded not guilty.
Stanford, whose fortune was estimated at $2.2 billion by Forbes magazine in 2008, is jailed in Houston awaiting trial.
The lawsuit, filed on Wednesday in Dallas federal court, accuses Stanford and his co-defendants in an alleged $7 billion Ponzi scheme of transferring the funds of defrauded investors to Christopher Aitken and Stephen Thacker to hide it from creditors.
Aitken and Thacker, who received the funds when they joined the firm in November of 2008, were employed for only three months and left "no indication that they provided any meaningful services," the lawsuit said.
Aitken received $8.7 million and Thacker $2.6 million as a partial payment for "personal goodwill" or the "personal relationships (they) have developed and maintained with clients," the suit said.
Ralph Janvey, the receiver in the case, says the men have no legitimate claim to the funds, which must be returned to help make victims of the fraud whole.
Lawyers for Aitken and Thacker could not be located immediately for comment. Stanford's attorney could not be reached for comment.
Janvey asked the judge to seize the funds and hold them in a trust while his investigation is under way.
Stanford, 59, and his former top aides James Davis and Laura Pendergest-Holt are accused of selling fraudulent certificates of deposit issued by Stanford's offshore bank, and of bribing regulators and accountants in Antigua to ignore the alleged wrongdoing.
Davis, Stanford Financial Group's former chief financial officer, has pleaded guilty to his role in the alleged scheme. Stanford and Pendergest-Holt, Stanford Financial Group's former chief investment officer, have pleaded not guilty.
Three others were also charged and pleaded not guilty.
Stanford, whose fortune was estimated at $2.2 billion by Forbes magazine in 2008, is jailed in Houston awaiting trial.
Stanford in solitary confinement, no trial date
Allen Stanford,the alleged swindler who is being held in solitary confinement in a federal jail, fell ill during a hearing on Wednesday where a judge denied the U.S. government's request to set a trial date.
Stanford, who has been taken to the hospital twice since his arrest on June 19, began spitting blood into tissues and a cup during the hearing, a condition his attorney described as a persistent and undiagnosed.
"They've checked him out and he appeared to be OK," Kent Schaffer, Stanford's attorney told reporters after the hearing in federal court in Houston.
At the status hearing which was temporarily held up by Stanford's condition, U.S District Judge David Hittner said defense attorneys on the case need more time to prepare.
"You will get a trial date set by me after the next conference," Hittner said, adding that the next hearing will likely be in December.
Stanford, 59, was arrested on June 18 and faces 21 criminal counts. He is accused of masterminding an alleged $7 billion scheme where fraudulent certificates of deposit from an Antiguan bank were sold to clients.
It was Stanford's first court appearance since he suffered a mild concussion, broken nose and two black eyes in a prison brawl last month while detained at the Joe Corley Detention Facility in Conroe, Texas.
At the hearing on Wednesday, Stanford's face bore faint bruising and he looked gaunt.
Stanford has since been moved to a federal detention facility in downtown Houston, where he is being held in an 8-foot by 9-foot cell and is prohibited from having phone calls or visits from his family, according to Schaffer.
"It's just harassment," the lawyer told reporters after the hearing. "They are trying to break him down."
A spokesperson for the U.S. Marshals Service did not immediately have a comment.
In their request for Hittner to set a trial date, U.S. prosecutors said defendants and their lawyers have now been provided access to court documents that they would need to help prepare for trial.
"There should be a trial date that people can start working around," Assistant U.S. Attorney Gregg Costa said at the hearing. "We're going to try a lean case."
Still, Stanford lawyer and other defense attorneys argued that it is too early to set a trial date because there is too much work to be done.
Judge Hittner ordered public defenders to take the case on Sept. 15 after Stanford failed to come up with the funds to retain a team of defense attorneys.
Since then, funds from a directors and officers insurance policy have become available and the federal public defenders are off the case.
Stanford, who has been taken to the hospital twice since his arrest on June 19, began spitting blood into tissues and a cup during the hearing, a condition his attorney described as a persistent and undiagnosed.
"They've checked him out and he appeared to be OK," Kent Schaffer, Stanford's attorney told reporters after the hearing in federal court in Houston.
At the status hearing which was temporarily held up by Stanford's condition, U.S District Judge David Hittner said defense attorneys on the case need more time to prepare.
"You will get a trial date set by me after the next conference," Hittner said, adding that the next hearing will likely be in December.
Stanford, 59, was arrested on June 18 and faces 21 criminal counts. He is accused of masterminding an alleged $7 billion scheme where fraudulent certificates of deposit from an Antiguan bank were sold to clients.
It was Stanford's first court appearance since he suffered a mild concussion, broken nose and two black eyes in a prison brawl last month while detained at the Joe Corley Detention Facility in Conroe, Texas.
At the hearing on Wednesday, Stanford's face bore faint bruising and he looked gaunt.
Stanford has since been moved to a federal detention facility in downtown Houston, where he is being held in an 8-foot by 9-foot cell and is prohibited from having phone calls or visits from his family, according to Schaffer.
"It's just harassment," the lawyer told reporters after the hearing. "They are trying to break him down."
A spokesperson for the U.S. Marshals Service did not immediately have a comment.
In their request for Hittner to set a trial date, U.S. prosecutors said defendants and their lawyers have now been provided access to court documents that they would need to help prepare for trial.
"There should be a trial date that people can start working around," Assistant U.S. Attorney Gregg Costa said at the hearing. "We're going to try a lean case."
Still, Stanford lawyer and other defense attorneys argued that it is too early to set a trial date because there is too much work to be done.
Judge Hittner ordered public defenders to take the case on Sept. 15 after Stanford failed to come up with the funds to retain a team of defense attorneys.
Since then, funds from a directors and officers insurance policy have become available and the federal public defenders are off the case.
Stanford Can Use Lloyd’s Insurance to Pay Lawyers, Judge Rules
Allen Stanford the Stanford Group Co. founder accused of leading a $7 billion investor-fraud scheme, can use corporate insurance policy proceeds to pay his defense lawyers, a judge ruled.
U.S. District Judge David Godbey of Dallas, who is hearing a Securities and Exchange Commission lawsuit against the Texas financier, ruled yesterday that he and other Stanford Group executives can draw from Lloyds of London officers’ and directors’ coverage said to be worth at least $50 million.
“The court finds it in the interest of fairness to allow directors and officers to access insurance proceeds to which they are entitled for several reasons,” Godbey said in a ruling posted to his court’s Web site that he said applies to all Stanford defendants. “The potential harm to them if denied coverage is not speculative but real and immediate; they may be unable to defend themselves in civil actions in which they do not have a right to court-appointed counsel.”
Stanford, who faces civil and criminal claims he swindled investors in a scheme involving the sale of certificates of deposit through Antigua-based Stanford International Bank Ltd., was given a federal public defender on Sept. 15 after a U.S. judge hearing his criminal case in Houston found he had no money to pay lawyers.
With a reported net worth of $2.2 billion, Stanford was ranked 205th on Forbes magazine’s 2008 list of richest Americans. He is being held without bail pending trial.
Kent Schaffer
Houston lawyer Kent Schaffer agreed to assist the public defenders’ office at the government pay rate of $110 an hour on Sept. 17. Stanford, who has denied all allegations of wrongdoing, has struggled to retain defense lawyers after his assets were frozen by the Dallas court on Feb. 17 following the filing of the SEC lawsuit.
The agency alleged that Stanford, two associates and three businesses paid early investors “improbable if not impossible” returns on their investments, using money received from later- arriving clients.
A U.S. grand jury in Houston in June indicted Stanford, his chief investment officer, Laura Pendergest-Holt, and three others for their alleged roles in the scheme. They all pleaded innocent. Stanford’s chief financial officer, James Davis, who was charged separately, pleaded guilty on Aug. 27 and is cooperating with the federal investigations.
DeGuerin, Luskin
Several high-priced lawyers have come and gone as Stanford’s attorney, including Houston criminal-defense lawyer Dick DeGuerin and Robert Luskin of Washington-based Patton Boggs.
DeGuerin withdrew in July after a dispute involving how he would be paid. Luskin was denied permission in August to represent Stanford for the limited purpose of helping the financier access money for lawyers.
Luskin, who said in an e-mail that he may continue helping Stanford appeal the denial of his bail, praised the ruling although he said he’s still digesting it.
“Obviously, we’re delighted with the ruling,” Luskin said. “It’s the right result and, much more important for Allen and for the justice system, helps to guarantee that Allen will have the resources to get a fair trial.”
Schaffer said in a phone interview yesterday that while he’s pleased with the ruling, he’s not sure how it will affect his ability to continue representing Stanford. Schaffer said the financier most likely doesn’t qualify for a publicly funded defense after the ruling, as taxpayers shouldn’t have to pay if Lloyd’s will.
‘Tremendous Progress’
“I’d like to stay on the case whether on an appointed or retained basis,” he said. “Now that we’ve been on the case for three weeks and we’ve done a ton of work, we think it’s a very defensible case. We’ve been making tremendous progress, and the further we get into it, the better the case is starting to look.”
Schaffer said he would meet with Stanford tomorrow at the federal prison in downtown Houston to learn whether the financier wants to keep him or change lawyers.
Ralph Janvey, the court-appointed receiver for Stanford’s businesses, had asked Godbey to reserve the Lloyd’s of London proceeds for his use in defending the Stanford companies against claims by investors and creditors.
Receivership Estate
The judge didn’t directly address Janvey’s request to reserve the policies for his use or declare the proceeds part of the receivership estate. Godbey called the receiver’s claim on the coverage “hypothetical” as Janvey hasn’t yet filed any invoices with the insurance carrier and Lloyd’s has filed a separate petition saying it plans to exclude Janvey as the receiver has repeatedly said the Stanford companies were involved in fraud.
“Those are questions for another day,” Godbey said in the ruling.
Kristie Blumenschein, Janvey’s spokeswoman, declined to comment on yesterday’s decision.
As many as 60 Stanford executives and employees are seeking to use the directors’ and officers’ coverage to defray their legal bills, according to Janvey. The receiver has said the coverage may be worth as much as $90 million.
Lawyers for Pendergest-Holt had asked the criminal case judge, David Hittner, to order Lloyd’s underwriters to pay the Stanford defendants’ legal bills.
Judge Hittner
While Hittner hasn’t ruled on Pendergest-Holt’s request, court filings indicate he made direct inquiries to both Janvey and Lloyd’s about whether anything prevented the insurer from paying the defendants’ legal bills. Both the receiver and Lloyds urged Hittner to defer to Godbey on the issue.
Pendergest-Holt’s lawyers said in e-mails yesterday that they are pleased with Godbey’s decision to let them access Stanford’s insurance coverage, a decision one said was “a long time coming.”
“We can now continue to concentrate our efforts on properly defending Ms. Holt without fear of financial ruin,” Dan Cogdell, Pendergest-Holt’s lead lawyer, wrote. “I have already re-submitted my prior bills to Lloyd’s. While I won’t say what the amount I am owed is, I will say it is a lot more than I am comfortable being owed.”
“There are many things to be done in connection with Ms. Holt’s defense that we as her lawyers have deferred due to lack of funds,” Jeffrey Tillotson, the Dallas lawyer assisting in Pendergest-Holt’s civil and criminal defense, said in a separate e-mail. “Ms. Holt hasn’t done anything wrong and has always intended on aggressively fighting the government’s charges. Now she will have some resources available to fight back.”
Cooperating Witness
David Finn, a lawyer for Davis, said the ruling will allow him to continue representing the government’s key cooperating witness.
“It means I will not have to file a motion to withdraw,” Finn said in an e-mail. “I am relieved because I will not have to keep digging into my pocket for expenses not knowing if I’d ever get paid.”
U.S. District Judge David Godbey of Dallas, who is hearing a Securities and Exchange Commission lawsuit against the Texas financier, ruled yesterday that he and other Stanford Group executives can draw from Lloyds of London officers’ and directors’ coverage said to be worth at least $50 million.
“The court finds it in the interest of fairness to allow directors and officers to access insurance proceeds to which they are entitled for several reasons,” Godbey said in a ruling posted to his court’s Web site that he said applies to all Stanford defendants. “The potential harm to them if denied coverage is not speculative but real and immediate; they may be unable to defend themselves in civil actions in which they do not have a right to court-appointed counsel.”
Stanford, who faces civil and criminal claims he swindled investors in a scheme involving the sale of certificates of deposit through Antigua-based Stanford International Bank Ltd., was given a federal public defender on Sept. 15 after a U.S. judge hearing his criminal case in Houston found he had no money to pay lawyers.
With a reported net worth of $2.2 billion, Stanford was ranked 205th on Forbes magazine’s 2008 list of richest Americans. He is being held without bail pending trial.
Kent Schaffer
Houston lawyer Kent Schaffer agreed to assist the public defenders’ office at the government pay rate of $110 an hour on Sept. 17. Stanford, who has denied all allegations of wrongdoing, has struggled to retain defense lawyers after his assets were frozen by the Dallas court on Feb. 17 following the filing of the SEC lawsuit.
The agency alleged that Stanford, two associates and three businesses paid early investors “improbable if not impossible” returns on their investments, using money received from later- arriving clients.
A U.S. grand jury in Houston in June indicted Stanford, his chief investment officer, Laura Pendergest-Holt, and three others for their alleged roles in the scheme. They all pleaded innocent. Stanford’s chief financial officer, James Davis, who was charged separately, pleaded guilty on Aug. 27 and is cooperating with the federal investigations.
DeGuerin, Luskin
Several high-priced lawyers have come and gone as Stanford’s attorney, including Houston criminal-defense lawyer Dick DeGuerin and Robert Luskin of Washington-based Patton Boggs.
DeGuerin withdrew in July after a dispute involving how he would be paid. Luskin was denied permission in August to represent Stanford for the limited purpose of helping the financier access money for lawyers.
Luskin, who said in an e-mail that he may continue helping Stanford appeal the denial of his bail, praised the ruling although he said he’s still digesting it.
“Obviously, we’re delighted with the ruling,” Luskin said. “It’s the right result and, much more important for Allen and for the justice system, helps to guarantee that Allen will have the resources to get a fair trial.”
Schaffer said in a phone interview yesterday that while he’s pleased with the ruling, he’s not sure how it will affect his ability to continue representing Stanford. Schaffer said the financier most likely doesn’t qualify for a publicly funded defense after the ruling, as taxpayers shouldn’t have to pay if Lloyd’s will.
‘Tremendous Progress’
“I’d like to stay on the case whether on an appointed or retained basis,” he said. “Now that we’ve been on the case for three weeks and we’ve done a ton of work, we think it’s a very defensible case. We’ve been making tremendous progress, and the further we get into it, the better the case is starting to look.”
Schaffer said he would meet with Stanford tomorrow at the federal prison in downtown Houston to learn whether the financier wants to keep him or change lawyers.
Ralph Janvey, the court-appointed receiver for Stanford’s businesses, had asked Godbey to reserve the Lloyd’s of London proceeds for his use in defending the Stanford companies against claims by investors and creditors.
Receivership Estate
The judge didn’t directly address Janvey’s request to reserve the policies for his use or declare the proceeds part of the receivership estate. Godbey called the receiver’s claim on the coverage “hypothetical” as Janvey hasn’t yet filed any invoices with the insurance carrier and Lloyd’s has filed a separate petition saying it plans to exclude Janvey as the receiver has repeatedly said the Stanford companies were involved in fraud.
“Those are questions for another day,” Godbey said in the ruling.
Kristie Blumenschein, Janvey’s spokeswoman, declined to comment on yesterday’s decision.
As many as 60 Stanford executives and employees are seeking to use the directors’ and officers’ coverage to defray their legal bills, according to Janvey. The receiver has said the coverage may be worth as much as $90 million.
Lawyers for Pendergest-Holt had asked the criminal case judge, David Hittner, to order Lloyd’s underwriters to pay the Stanford defendants’ legal bills.
Judge Hittner
While Hittner hasn’t ruled on Pendergest-Holt’s request, court filings indicate he made direct inquiries to both Janvey and Lloyd’s about whether anything prevented the insurer from paying the defendants’ legal bills. Both the receiver and Lloyds urged Hittner to defer to Godbey on the issue.
Pendergest-Holt’s lawyers said in e-mails yesterday that they are pleased with Godbey’s decision to let them access Stanford’s insurance coverage, a decision one said was “a long time coming.”
“We can now continue to concentrate our efforts on properly defending Ms. Holt without fear of financial ruin,” Dan Cogdell, Pendergest-Holt’s lead lawyer, wrote. “I have already re-submitted my prior bills to Lloyd’s. While I won’t say what the amount I am owed is, I will say it is a lot more than I am comfortable being owed.”
“There are many things to be done in connection with Ms. Holt’s defense that we as her lawyers have deferred due to lack of funds,” Jeffrey Tillotson, the Dallas lawyer assisting in Pendergest-Holt’s civil and criminal defense, said in a separate e-mail. “Ms. Holt hasn’t done anything wrong and has always intended on aggressively fighting the government’s charges. Now she will have some resources available to fight back.”
Cooperating Witness
David Finn, a lawyer for Davis, said the ruling will allow him to continue representing the government’s key cooperating witness.
“It means I will not have to file a motion to withdraw,” Finn said in an e-mail. “I am relieved because I will not have to keep digging into my pocket for expenses not knowing if I’d ever get paid.”
Tuesday, 6 October 2009
Receiver Goes after Law Firms
Court-appointed receiver Ralph Janvey has turned the spotlight on two law firms. The Miami Herald reported over the weekend that Janvey, who has been working with federal agents, is now pressing for more information directly from Stanford's lawyers.
The receiver has made a request for legal files provided to R Allen Stanford by Greenberg Traurig and another firm, Hunton & Williams. The Herald listed this latest move by Janvey as “one of the most aggressive moves waged by the receiver to search for assets from Stanford's far-flung banking network".
While Greenberg Traurig is not under criminal investigation, the firm is facing a legal review of its actions in Antigua. Ross Gaffney, a former FBI agent who investigated Stanford, was quoted as saying: "I'm sure one of the things they will look at is what did Greenberg Traurig know, and when did they know it, and did they have any liability?''
According to the article, Greenberg Traurig's effort to assist Stanford in 1998 was but one move in a series which saw the Florida law firm rescuing Stanford from crisis and propelling his business interests. The Herald sought interviews with five lawyers who represented Stanford while working for the firm. Two of the five declined to comment, but assured that they were simply providing legal support and were not aware of any illegal schemes by Stanford.
The article spoke of a “money pipeline” between Miami and Antigua which Greenberg lawyers helped Stanford create. It went on to describe Stanford's creation of a trust office in downtown Miami which could move millions overseas without reporting anything to the government.
According to the article, “The unusual arrangement -- created over the objections of Florida's chief banking lawyer -- let Stanford open the office without submitting to fraud checks or money-laundering requirements. Over the next decade, the Miami center sold millions in Stanford's key investments -- certificates of deposit -- the checks stuffed in pouches and sent in jets to Antigua.”
The article also chronicled the changes in Antigua's banking system and Stanford's effort to “keep the pipeline alive”. The US Treasury, the article explained, was considering blacklisting all of Antigua's offshore institutions because of money laundering and fraud. In response, Stanford met with then prime minister, Lester Bird and agreed to pay out of his own pocket for a task force to rewrite the banking laws.
This task force, the article said, which included Greenberg lawyer Carlos Loumiet, met in Miami and St John's to examine ways to avoid a shutdown of the banks. According to the article, the 1998 legislation gave birth to a new regulatory agency - with Stanford on board - which would give protection to the investor from regulators for the next decade.
The Herald pointed to a particular incident which highlighted the power Stanford gained in Antigua by owning the largest bank. It spoke of the new regulatory agency requesting all of the island's secret offshore banking records. The head regulator, Althea Crick, refused. The agency waited until Crick had left for the day before seizing the filing cabinets containing the records and taking them to another building.
According to the story, the February 1999 takeover was approved by the new regulatory board, including an advisor to Bird, Errol Cort. The Herald rebutted statements which suggested that the takeover “was not done under the cover of darkness". According to the article, records show that Cort was a director of Stanford Trust Company and one of Stanford's Antigua lawyers.
International pressure from US and British authorities would later force Stanford to step down from his position and Antigua officials agreed to change the laws crafted by the task force. However, according to the article, “the momentum was in motion to help Stanford's bank for years to follow.”
It noted, “With the new regulatory agency enforcing new banking rules, most of the 56 offshore banks on the island were eliminated, swatting away much of his competition.” It also explained that court records show that Stanford's own bank was fabricating financial reports at the same time he was taking over the regulatory agency.
With millions of dollars coming into the Antiguan bank, Stanford switched to Hunton & Williams, after Loumiet joined the firm in 2001. In 2002, regulator Crick was replaced by Leroy King, who has been accused of taking more than $200,000 in bribes.
Loumiet and Hunton & Williams have agreed to turn over records of legal work for Stanford's US companies to Janvey. But they are fighting to keep secret the details of Stanford's businesses in Antigua and other foreign countries.
A spokeswoman for Hunton & Williams, Eleanor Kerlow, was quoted as saying: “There are legal issues regarding jurisdiction and client privilege that must be resolved before we proceed further.'”
According to the Herald, it is anticipated that Houston Judge David Godbey will decide whether the firm must meet Janvey's demands. Kristie Blumenschein, an attorney with the receiver's firm, has indicated that they are ready to fight for the records. According to Blumenschein, Janvey will not only search for assets, but the actions of the lawyers, dating to the 1990s, will also be under review.
It is being suggested that Janvey can demand lawyers be coerced into testifying about what they knew, since any conversations they had with Stanford about his ongoing crises are not protected by attorney-client privilege.
Comments (7)
...
written by MLM, October 05, 2009
Didn't Lester Bird give sanction to Stanford to rewrite the Banking Laws? which gave birth to a New Regulatory Agency, putting this whole thing in Motion. And we all know why that was done.
written by John, October 05, 2009
Errol should step down before the proverbial s--t hits the fan
Stanford Vindictive
written by RASCAS, October 05, 2009
This shows Standords vindictive nature. Get rid of al lthe other banks and he was the elephant in the ointment. Always the Expats. Antigua please learn, when we run our own affairs we don't end up in trouble. America was after their own. The ligimate banks get screwed in the crossfire. Go throught the history there is a glearing trend. Where is Bruce Rappaport?
is Cort inocent
written by yo mama, October 05, 2009
According to the story, the February 1999 takeover was approved by the new regulatory board, including an advisor to Bird, Errol Cort. The Herald rebutted statements which suggested that the takeover “was not done under the cover of darkness". According to the article, records show that Cort was a director of Stanford Trust Company and one of Stanford's Antigua lawyers.
OMG, Stanford , I am coming to join you Big Brother
written by 8 ball, October 05, 2009
Looks like Cort's day soon come.. Well he can use his National Security position and protect Stanford from the Prison inmate should they try to harm him again. Cant wait to see what he knows.
The receiver has made a request for legal files provided to R Allen Stanford by Greenberg Traurig and another firm, Hunton & Williams. The Herald listed this latest move by Janvey as “one of the most aggressive moves waged by the receiver to search for assets from Stanford's far-flung banking network".
While Greenberg Traurig is not under criminal investigation, the firm is facing a legal review of its actions in Antigua. Ross Gaffney, a former FBI agent who investigated Stanford, was quoted as saying: "I'm sure one of the things they will look at is what did Greenberg Traurig know, and when did they know it, and did they have any liability?''
According to the article, Greenberg Traurig's effort to assist Stanford in 1998 was but one move in a series which saw the Florida law firm rescuing Stanford from crisis and propelling his business interests. The Herald sought interviews with five lawyers who represented Stanford while working for the firm. Two of the five declined to comment, but assured that they were simply providing legal support and were not aware of any illegal schemes by Stanford.
The article spoke of a “money pipeline” between Miami and Antigua which Greenberg lawyers helped Stanford create. It went on to describe Stanford's creation of a trust office in downtown Miami which could move millions overseas without reporting anything to the government.
According to the article, “The unusual arrangement -- created over the objections of Florida's chief banking lawyer -- let Stanford open the office without submitting to fraud checks or money-laundering requirements. Over the next decade, the Miami center sold millions in Stanford's key investments -- certificates of deposit -- the checks stuffed in pouches and sent in jets to Antigua.”
The article also chronicled the changes in Antigua's banking system and Stanford's effort to “keep the pipeline alive”. The US Treasury, the article explained, was considering blacklisting all of Antigua's offshore institutions because of money laundering and fraud. In response, Stanford met with then prime minister, Lester Bird and agreed to pay out of his own pocket for a task force to rewrite the banking laws.
This task force, the article said, which included Greenberg lawyer Carlos Loumiet, met in Miami and St John's to examine ways to avoid a shutdown of the banks. According to the article, the 1998 legislation gave birth to a new regulatory agency - with Stanford on board - which would give protection to the investor from regulators for the next decade.
The Herald pointed to a particular incident which highlighted the power Stanford gained in Antigua by owning the largest bank. It spoke of the new regulatory agency requesting all of the island's secret offshore banking records. The head regulator, Althea Crick, refused. The agency waited until Crick had left for the day before seizing the filing cabinets containing the records and taking them to another building.
According to the story, the February 1999 takeover was approved by the new regulatory board, including an advisor to Bird, Errol Cort. The Herald rebutted statements which suggested that the takeover “was not done under the cover of darkness". According to the article, records show that Cort was a director of Stanford Trust Company and one of Stanford's Antigua lawyers.
International pressure from US and British authorities would later force Stanford to step down from his position and Antigua officials agreed to change the laws crafted by the task force. However, according to the article, “the momentum was in motion to help Stanford's bank for years to follow.”
It noted, “With the new regulatory agency enforcing new banking rules, most of the 56 offshore banks on the island were eliminated, swatting away much of his competition.” It also explained that court records show that Stanford's own bank was fabricating financial reports at the same time he was taking over the regulatory agency.
With millions of dollars coming into the Antiguan bank, Stanford switched to Hunton & Williams, after Loumiet joined the firm in 2001. In 2002, regulator Crick was replaced by Leroy King, who has been accused of taking more than $200,000 in bribes.
Loumiet and Hunton & Williams have agreed to turn over records of legal work for Stanford's US companies to Janvey. But they are fighting to keep secret the details of Stanford's businesses in Antigua and other foreign countries.
A spokeswoman for Hunton & Williams, Eleanor Kerlow, was quoted as saying: “There are legal issues regarding jurisdiction and client privilege that must be resolved before we proceed further.'”
According to the Herald, it is anticipated that Houston Judge David Godbey will decide whether the firm must meet Janvey's demands. Kristie Blumenschein, an attorney with the receiver's firm, has indicated that they are ready to fight for the records. According to Blumenschein, Janvey will not only search for assets, but the actions of the lawyers, dating to the 1990s, will also be under review.
It is being suggested that Janvey can demand lawyers be coerced into testifying about what they knew, since any conversations they had with Stanford about his ongoing crises are not protected by attorney-client privilege.
Comments (7)
...
written by MLM, October 05, 2009
Didn't Lester Bird give sanction to Stanford to rewrite the Banking Laws? which gave birth to a New Regulatory Agency, putting this whole thing in Motion. And we all know why that was done.
written by John, October 05, 2009
Errol should step down before the proverbial s--t hits the fan
Stanford Vindictive
written by RASCAS, October 05, 2009
This shows Standords vindictive nature. Get rid of al lthe other banks and he was the elephant in the ointment. Always the Expats. Antigua please learn, when we run our own affairs we don't end up in trouble. America was after their own. The ligimate banks get screwed in the crossfire. Go throught the history there is a glearing trend. Where is Bruce Rappaport?
is Cort inocent
written by yo mama, October 05, 2009
According to the story, the February 1999 takeover was approved by the new regulatory board, including an advisor to Bird, Errol Cort. The Herald rebutted statements which suggested that the takeover “was not done under the cover of darkness". According to the article, records show that Cort was a director of Stanford Trust Company and one of Stanford's Antigua lawyers.
OMG, Stanford , I am coming to join you Big Brother
written by 8 ball, October 05, 2009
Looks like Cort's day soon come.. Well he can use his National Security position and protect Stanford from the Prison inmate should they try to harm him again. Cant wait to see what he knows.
Saturday, 3 October 2009
Stanford Receiver Wants $8.8 Million More for Fees, Expenses
Ralph Janvey is asking for another $8.8 million in fees and expenses for his work as the court- appointed receiver for the businesses of accused Ponzi scheme mastermind R. Allen Stanford.
Janvey won court approval last month for about $20 million in fees and expenses for work he did from February through May on behalf of investors allegedly swindled out of more than $7 billion through a scheme involving Antiguan bank certificates of deposit. Yesterday’s request covers work by Janvey and 13 accounting and legal firms assisting him from June through August.
Janvey said the latest request reflects the 20 percent discount his team has applied to their standard billing rates throughout the Stanford Financial Group receivership assignment, out of consideration for how little money Stanford’s investors will likely recover. Of the $8.8 million he’s now requesting, Janvey said $2.2 million will be held back in accordance with a court ruling that he defer 20 percent of his billings until the ultimate success of his efforts can be assessed.
“Despite many unanticipated additional activities required of the professionals, these fees and expenses are less than what the receiver projected in the first and second interim fee applications,” Kevin Sadler, Janvey’s lead attorney, said in the filing.
Stanford, who is in jail awaiting trial on 21 felony counts that mirror allegations by the U.S. Securities and Exchange Commission, denies any wrongdoing in connection with CDs sold by Stanford International Bank Ltd. in Antigua. The SEC accused him, some associates and three of his companies of running a “massive” fraud that paid early investors “improbable if not impossible” returns by taking funds from later investors.
Public Defender
Stanford, ranked as the 205th richest American in 2008 by Forbes magazine, with assets of $2 billion, was assigned a public defender after the judge in his criminal case concluded he had no money to pay attorneys. Stanford is fighting Janvey for access to his frozen assets or his company’s legal insurance policy so he can pay his own legal fees.
Kent Schaffer, Stanford’s court-appointed criminal-defense attorney, said Janvey’s fee request was “not surprising” in light of his earlier billings.
“It is sickening what they are doing and the rate at which they are looting the estate,” Schaffer said yesterday in an e-mail. He said Janvey should file a motion asking “that all assets recovered be conveyed to him” so his lawyers wouldn’t have to keep filing requests for additional fees.
Paid Nothing
Dan Cogdell, who represents Stanford’s chief investment officer and co-defendant Laura Pendergest-Holt, said it isn’t fair that Janvey has been paid millions in fees and expenses while the defendants’ lawyers haven’t been paid anything.
“I would feel a lot more sanguine about the situation if the receiver would not continue to be the impediment to our fees being paid,” Cogdell said in an e-mail message. “My firm began working on this matter in February, and we’ve not seen a single cent, due to the receiver’s objections to the insurer paying those fees.” John J. Little, the court-appointed examiner for Stanford’s investors in the SEC case, declined to comment on Janvey’s latest fee request.
“I haven’t had time to wade through the 1,000-plus pages” of supporting invoices and billing records Janvey submitted with his request, Little said in an e-mail. Previously, Little told the judge overseeing the case that he feared Janvey’s billings will consume the entire Stanford estate, leaving nothing for investors.
‘Something’ for Investors
That sentiment was echoed by David Finn, the attorney representing Stanford’s finance chief, James M. Davis, who pleaded guilty to the fraud and is cooperating with the government.
“I hope there’s something left for the investors,” Finn said in an e-mail response to Janvey’s filing.
Janvey won court approval last month for about $20 million in fees and expenses for work he did from February through May on behalf of investors allegedly swindled out of more than $7 billion through a scheme involving Antiguan bank certificates of deposit. Yesterday’s request covers work by Janvey and 13 accounting and legal firms assisting him from June through August.
Janvey said the latest request reflects the 20 percent discount his team has applied to their standard billing rates throughout the Stanford Financial Group receivership assignment, out of consideration for how little money Stanford’s investors will likely recover. Of the $8.8 million he’s now requesting, Janvey said $2.2 million will be held back in accordance with a court ruling that he defer 20 percent of his billings until the ultimate success of his efforts can be assessed.
“Despite many unanticipated additional activities required of the professionals, these fees and expenses are less than what the receiver projected in the first and second interim fee applications,” Kevin Sadler, Janvey’s lead attorney, said in the filing.
Stanford, who is in jail awaiting trial on 21 felony counts that mirror allegations by the U.S. Securities and Exchange Commission, denies any wrongdoing in connection with CDs sold by Stanford International Bank Ltd. in Antigua. The SEC accused him, some associates and three of his companies of running a “massive” fraud that paid early investors “improbable if not impossible” returns by taking funds from later investors.
Public Defender
Stanford, ranked as the 205th richest American in 2008 by Forbes magazine, with assets of $2 billion, was assigned a public defender after the judge in his criminal case concluded he had no money to pay attorneys. Stanford is fighting Janvey for access to his frozen assets or his company’s legal insurance policy so he can pay his own legal fees.
Kent Schaffer, Stanford’s court-appointed criminal-defense attorney, said Janvey’s fee request was “not surprising” in light of his earlier billings.
“It is sickening what they are doing and the rate at which they are looting the estate,” Schaffer said yesterday in an e-mail. He said Janvey should file a motion asking “that all assets recovered be conveyed to him” so his lawyers wouldn’t have to keep filing requests for additional fees.
Paid Nothing
Dan Cogdell, who represents Stanford’s chief investment officer and co-defendant Laura Pendergest-Holt, said it isn’t fair that Janvey has been paid millions in fees and expenses while the defendants’ lawyers haven’t been paid anything.
“I would feel a lot more sanguine about the situation if the receiver would not continue to be the impediment to our fees being paid,” Cogdell said in an e-mail message. “My firm began working on this matter in February, and we’ve not seen a single cent, due to the receiver’s objections to the insurer paying those fees.” John J. Little, the court-appointed examiner for Stanford’s investors in the SEC case, declined to comment on Janvey’s latest fee request.
“I haven’t had time to wade through the 1,000-plus pages” of supporting invoices and billing records Janvey submitted with his request, Little said in an e-mail. Previously, Little told the judge overseeing the case that he feared Janvey’s billings will consume the entire Stanford estate, leaving nothing for investors.
‘Something’ for Investors
That sentiment was echoed by David Finn, the attorney representing Stanford’s finance chief, James M. Davis, who pleaded guilty to the fraud and is cooperating with the government.
“I hope there’s something left for the investors,” Finn said in an e-mail response to Janvey’s filing.
Finra messed up, what a shock
The report by Finra on its failure to detect the alleged Ponzi scheme at Allen Stanford’s offshore bank is no shock.
Finra makes the SEC look like an agressive regulator. And this should give anyone reason to pause when you consider that Mary Schaprio, the current Securities and Exchange Commission chairman, most recently headed-up Finra.
Schaprio tells us her mission is to beef-up the SEC’s enforcement procedures in the wake of its own failings on Stanford and more significantly its botched investigation–or non-investigation–of Bernard Madoff. Why didn’t she first do this when she was at Finra?
The report outling Finra’s missteps notes regulators failed to follow-up on claims made by former Stanford brokers that the CDs the firm’s offshore bank in Antigua was selling were either bogus or “too good to be true.” Going as far back as 2004, a number of brokers raised this claim in arbitration disputes they had with Stanford.
Late last year, after Madoff was arrested, I began investigating allegations that Stanford’s financial empire was a Ponzi scheme. I did this while I was still working at BusinessWeek and early on I came across a few arbitration cases in which brokers had alleged the returns Stanford CDs seemed too good to be true.
Soon after Stanford was charged by the SEC with civil fraud, a source pointed me to an old lawsuit filed in Florida state court where a former employee also claimed the operation was a Ponzi scheme.
All of of these legal filings were either in the public record or in Finra files, yet it appears the level of communication between Finra’s arbitration unit and its enforcement operation is poor. This has been a long standing complaint from brokers, investors and securities lawyers and it needs to be fixed.
The inability of one side of an organization to talk to another can be damaging to a business. It’s no less damaging for a regulatory agency. But when regulators don’t communicate, innocent investors get hurt.
Finra makes the SEC look like an agressive regulator. And this should give anyone reason to pause when you consider that Mary Schaprio, the current Securities and Exchange Commission chairman, most recently headed-up Finra.
Schaprio tells us her mission is to beef-up the SEC’s enforcement procedures in the wake of its own failings on Stanford and more significantly its botched investigation–or non-investigation–of Bernard Madoff. Why didn’t she first do this when she was at Finra?
The report outling Finra’s missteps notes regulators failed to follow-up on claims made by former Stanford brokers that the CDs the firm’s offshore bank in Antigua was selling were either bogus or “too good to be true.” Going as far back as 2004, a number of brokers raised this claim in arbitration disputes they had with Stanford.
Late last year, after Madoff was arrested, I began investigating allegations that Stanford’s financial empire was a Ponzi scheme. I did this while I was still working at BusinessWeek and early on I came across a few arbitration cases in which brokers had alleged the returns Stanford CDs seemed too good to be true.
Soon after Stanford was charged by the SEC with civil fraud, a source pointed me to an old lawsuit filed in Florida state court where a former employee also claimed the operation was a Ponzi scheme.
All of of these legal filings were either in the public record or in Finra files, yet it appears the level of communication between Finra’s arbitration unit and its enforcement operation is poor. This has been a long standing complaint from brokers, investors and securities lawyers and it needs to be fixed.
The inability of one side of an organization to talk to another can be damaging to a business. It’s no less damaging for a regulatory agency. But when regulators don’t communicate, innocent investors get hurt.
Friday, 2 October 2009
Finra Missed Chances to Catch Stanford and Madoff, Report Says
The Financial Industry Regulatory Authority didn’t fully probe transactions at Bernard Madoff’s firm and repeatedly failed to investigate tips about R. Allen Stanford’s alleged $7 billion fraud, an internal report said.
The staff of the U.S. brokerage industry’s main regulator is “not adequately trained” on its investigative authority, and the Washington-based regulator lacks procedures to escalate matters to senior management or special investigators “based on the gravity and substance of the fraud allegations,” according to a report posted on Finra’s Web site today.
The findings follow a series of reports by Securities and Exchange Commission Inspector General H. David Kotz, which faulted the SEC’s oversight of Madoff over 16 years and examined the agency’s attempts to investigate Stanford. In the Stanford case, Kotz concluded that the SEC was hampered by jurisdictional limits and Stanford’s refusal to cooperate.
“As regulators, we owe it to investors -- especially those harmed by recent scandals -- to develop a better, more comprehensive, response to fraud,” Finra Chief Executive Officer Richard Ketchum said in a statement. “I am committed to taking the lessons from the report’s findings to make Finra even stronger.”
Finra said it will create a new Office of Fraud Detection and Market Intelligence to ensure that staff with expertise in fraud detection respond rapidly to suspected scams.
The staff of the U.S. brokerage industry’s main regulator is “not adequately trained” on its investigative authority, and the Washington-based regulator lacks procedures to escalate matters to senior management or special investigators “based on the gravity and substance of the fraud allegations,” according to a report posted on Finra’s Web site today.
The findings follow a series of reports by Securities and Exchange Commission Inspector General H. David Kotz, which faulted the SEC’s oversight of Madoff over 16 years and examined the agency’s attempts to investigate Stanford. In the Stanford case, Kotz concluded that the SEC was hampered by jurisdictional limits and Stanford’s refusal to cooperate.
“As regulators, we owe it to investors -- especially those harmed by recent scandals -- to develop a better, more comprehensive, response to fraud,” Finra Chief Executive Officer Richard Ketchum said in a statement. “I am committed to taking the lessons from the report’s findings to make Finra even stronger.”
Finra said it will create a new Office of Fraud Detection and Market Intelligence to ensure that staff with expertise in fraud detection respond rapidly to suspected scams.