Allen Stanford Investors Sue His Accounting Firm

Nearly two years after Texas financier Allen Stanford was indicted in an alleged massive Ponzi scheme, investors have just filed a $10 billion proposed class action suit against his auditor—the giant accounting firm BDO.

The suit—filed Thursday in federal court in Dallas—says BDO did not only aid and abet the $7 billion dollar fraud...it was a "co-conspirator."

“BDO’s cozy relationship with the Stanford Financial Group was steeped in conflicts of interest and required ongoing deceptive and duplicitous manipulation of the facts to allow the Ponzi scheme’s exponential growth for over a decade,” the complaint says. “The result of this deception is the loss of thousands of investors’ life savings.”

BDO not only audited Stanford's U.S. operations, it also did critical work in Antigua, where the alleged fraud was based.

Before his indictment in 2009, Stanford told CNBC about a task force he put together—including a "major accounting firm" to rewrite Antigua's banking laws.

“Back in the early '90s, I was asked by the then-government if I would put together a civilian team of professionals, which I got,” Stanford said. “Ex-FBI, ex-DEA, an ex-U.S. Attorney…a major accounting firm and others to come up with a strong, if not the strongest platform for international banking.”

Authorities and investors say that platform paved the way for the fraud. Stanford has denied wrongdoing. He faces a trial currently scheduled for September 12 on 14 criminal counts.

BDO has not had a chance to respond to the suit, but for months it has been fighting a civil subpoena for documents filed by the court-appointed receiver in the SEC’s lawsuit against Stanford.

In a court filing in April, BDO attorneys said the firm "has no clue as to what it may have done wrong." The filing called the subpoena “a fishing expedition.”

Stanford's 30-thousand investors have so far recovered just pennies on the dollar.