Stanford liquidators to access $20m of assets

By Jane Croft in London - ft.com

Grant Thornton, the liquidators of Allen Stanford’s business empire, will be permitted to draw down up to $20m of the $100m of assets currently frozen in London, a judge has ruled.

Mrs Justice Gloster, sitting at London’s Central Criminal Court, ruled that the liquidators of Antigua-based Stanford International Bank can use the funds to launch legal action against third parties and to market and sell property assets once owned by the cricket-loving tycoon, who has been accused of orchestrating a multibillion-dollar fraud, which he denies.

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Initially some $5m of the assets, which are partly tied up in London hedge fund accounts, will be drawn down by the liquidators, who can access up to $20m of funds in total.

Grant Thornton, which came on board as liquidator to SIB in May, has already received approval from an ad hoc creditors’ committee for its action plan aimed at helping realise value from Antiguan assets for the victims of the alleged Ponzi scheme.

Marcus Wide, joint liquidator, told the Financial Times that part of the funds would be used to launch litigation to help secure $70m of value from properties in Antigua – including the headquarters of SIB – which are currently frozen by a court order.

“We will also do a property survey of the real estate and get expert advice on it and we will also be filing legal claims against third parties before we run out of time,” he said

Mr Wide added that funds would also be spent on minor development of certain assets – such as finishing a port facility that is 95 per cent complete and building a road across Pelican Island, an Antiguan island, which could help push up its market value.

The liquidators have argued in a recent letter to creditors that the additional funds would help unlock underlying value in the real estate as it would enable sales over a period of time rather than in a quick sale.

The London court was told this week by Grant Thornton – which is being advised by law firm Lawrence Graham – that if the judge did not approve the application, they were considering alternative financing from a hedge fund to pursue the action plan.

The application made this week in the London courts was fiercely opposed by lawyers for the UK’s Serious Fraud Office acting on behalf of the Department of Justice, which believes the money should ultimately be repatriated to the US.

Mr Stanford’s trial was postponed in January in order to allow him to wean himself off a cocktail of anti-anxiety drugs. His knighthood was revoked after criminal charges were filed.