Stanford victims outside of US and Antigua want justice too

CARACAS, Venezuela, Friday September 30, 2011 – A three-person organisation has stepped up to represent over 20,000 people across 112 countries who were victimised when the ponzi scheme of former Antigua-based banker Allen Stanford collapsed over 2 years ago.

The Texas based leader of the organisation, has denounced authorities in the United States and Antigua for what they see as a deliberate disenfranchisement of Stanford victims outside of those two territories.

In a press release, The Texas based leader, stated that he had sent a letter to the new Joint Liquidators of Stanford International Bank Limited Marcus Wide and Hugh Dickson on September 18, copied to the US Receiver, his litigant attorney and to the Official Stanford Investors Committee, to express its indignation at the “dishonest handling of the Stanford Ponzi scheme in Antigua and the United States”.

“Since the SEC filed the civil lawsuit against R. Allen Stanford, his companies and related parties in February of 2009, the organisation has persistently begged the US Receiver and SIBL’s Joint Liquidators, through letters and press releases, to set aside their pettiness and economic interests in order to end the shameful game of “cat and mouse” that has wasted the Stanford victims’ patrimony in a never-ending carousel of litigation's as a result of their irrational pursuit to control the assets.

“It is unacceptable that the Courts in Antigua and the United States, in detriment to the Stanford’s victims, have allowed the Joint Liquidators and the Receiver, who were named to prevent the waste and squandering of the creditors' patrimony, to continue fighting for the assets - duplicating costs and efforts, and hindering the possibilities of a pro rata distribution of the victims’ patrimony,”.

The Texas based leader went on to accuse authorities in Antigua and the US of conspiring to allow Stanford “to keep a fraudulent financial empire alive for more than a decade”.
The organisation’s leader went on to say: “We perceive that the case has been managed with very little transparency. We are concerned that the joint liquidators and the receiver continue to be a part of the problem and not a part of the solution. Why prolong the agony of the victims for a jurisdictional battle?”

In the letter, the organisation’s members went on to beg the joint liquidators of and the US receiver to establish a cross-border insolvency cooperation protocol without any further delay.

Ponzi Proprieties

"It is with a pious fraud as with a bad action; it begets a calamitous necessity of going on."

-- Thomas Paine, The Age of Reason.

One of the questions being asked with increasing regularity is what is the polite thing to do when you have benefitted from the actions of someone running a Ponzi scheme. In one case it may be that you invested and got remarkable returns, and in another it may be that you were not an investor, but the recipient of the funds that the Ponzi schemer stole. Herewith two different answers to that question. But first, a word about the process itself.

Let us assume that you invested $100 with Bernie Madoff 10 years ago, and for the last 10 years have been getting a 30 percent return on the investment. Now you learn that in the years after you made your first investment, Mr. Madoff convinced everyone in your neighbourhood to give him $100 to invest, and he used that to pay you. Once that became known, of course, your neighbours were upset. The courts were also upset and appointed someone called a receiver to try to recoup for your neighbours the profits on the $100 investment you and other early investors made. Early investors were not the only beneficiaries of Ponzi schemes. Sometimes the schemer gave money he collected to charities, or even politicians, for political purposes.

Irving Picard is the court-appointed trustee of the Madoff mess that was uncovered on December 8, 2008. To date, Mr. Picard has recovered almost one half of the estimated $20 billion lost by Madoff investors. A good chunk of what Mr. Picard has collected to date comes from the widow of Jeffry M. Picower. Mr. Picower had invested with Mr. Madoff for more than 30 years. Ms. Picower agreed to return $7.2 billion to the fund. In a statement accompanying her agreement to pay, she said:

On behalf of my late husband Jeffry and his estate, I am announcing today that we... will return every penny received from almost 35 years of investing with Bernard Madoff, an amount totalling $7.2 billion that will go to the Madoff victims' compensation fund. Although it is my understanding that the estate's legal liability may not have exceeded $2.4 billion, I believe that this settlement honours what Jeffry would have wanted... I believe that the Madoff Ponzi scheme was deplorable and I am deeply saddened by the tragic impact it continues to have on the lives of its victims. It is my hope that this settlement will ease that suffering.
Not everyone is concerned about victims.

Ralph Janvey is a Dallas lawyer. He is the receiver for Stanford Financial Group that was run by R. Allen Stanford. In early 2009, it was learned that Mr. Stanford had stolen more than $7 billion from investors in 114 countries in a Ponzi scheme. Mr. Janvey, like Mr. Picard, is charged with trying to recover that money for the victims of the fraud. To date, Mr. Janvey has recovered less than $200 million. Part of his problem is the kinds of people who benefitted from the scheme before it was uncovered. They were not all investors. Some of them were members of Congress and the Democratic and Republican National Committees, to whom Mr. Stanford made contributions.

They were not eager to return the funds they had received. According to the Washington Post: "At least 50 members of the House and Senate have either ignored restitution demands or donated some of Stanford's campaign contributions to charity instead... " Included among the refuseniks are Eric Cantor, the House Majority Leader, Charles Schumer, the chairman of the Senate Rules Committee, Senator Bill Nelson who chairs a Finance Committee subcommittee and Senator John Cornyn, a member of the Judiciary Committee.

Senator Cornyn explained that, when he learned of the Ponzi-like character of the Stanford operation, he donated the money he'd received to charity. Senator Cornyn comes from Texas. According to one victims' group, 1,300 Texans invested with Stanford and lost $582 million that the receiver is trying to recover. The 1,300 probably feel a lot better knowing that Mr. Cornyn gave the funds that rightfully belonged to them to charity instead of to the receiver, who could have distributed it back to them. Senator Nelson told the Post he had given the money he received to charity but was now preparing to write a check to the receiver. Mr. Cantor said he'd give back the money if the receiver gave him a release. It isn't clear what he wants to be released from. The political fundraising committees are less tractable. According to the Post, "four of the principal national Republican and Democratic fundraising committees took in $1.6 million in Stanford donations," that they have refused to disgorge and over which they are now fighting with the receiver.

It's too bad the beneficiaries of the Stanford scam didn't have among their number people of the caliber of Ms. Picower. If there were, the receiver might have recovered more than a paltry $200 million. Indeed, it's too bad there aren't more people with a moral compass like that possessed by Ms. Picower living among us.

Is the end near?

As they approach their 60s, Blaine Smith and his wife, who once had a $1.5 million nest egg, are preparing to move into a rental house or apartment in July.

The couple is selling their $850,000 dream home, for which they saved for most of their professional lives—working two, and sometimes three, jobs—because they're no longer able to afford the mortgage payments.

They've also delayed their retirement plans, returning to work at a time when they thought they would be taking it easy. And they haven't taken a vacation since flamboyant financier Robert Allen Stanford's alleged $7 billion Ponzi scheme came to light.

The Smiths are but two of an estimated 28,000 victims of the Stanford Group, spread across 46 states and 188 countries, who still are awaiting justice. The Smiths unknowingly invested—and lost—their 30-year savings in the group's certificates of deposit.

"It's the worst nightmare you could ever imagine," Smith says. "It consumes me to know that the [Securities and Exchange Commission] sat on this for 12 years and didn't warn anyone."


A federal judge finally has set aside a trial date for Stanford, the man behind the alleged scheme. Jury selection is scheduled to begin Sept. 12 in Houston.

But the Smiths, and thousands of other bilked Stanford investors, still are waiting to see whether they'll ever see so much as a penny of their money returned.

Court-appointed Stanford receiver Ralph Janvey, who is suing to recover $600 million, has recovered less than one-third of that amount. After attorneys' fees and other expenses, that leaves about $100 million. Investors who lost money likely are to see only a penny or two for every dollar they invested.

The Smiths and other victims likewise are still awaiting word on whether the Securities Investor Protection Corporation—an insurance fund for brokerages—will cover any of their losses up to $500,000. The agency, which is overseen by the SEC, so far has opposed covering Stanford victims because the investments were CDs rather than stocks; a final decision is expected in the next few weeks.

The SIPC has helped an estimated 739,000 investors recover $109.3 billion in assets over the past 40 years, but the brokerage insurance does not cover every investor or every investment.

The 61-year-old Stanford, who denies all wrongdoing, is charged with 14 criminal counts involving certificates of deposit issued by his Antigua-based Stanford International Bank. He has been imprisoned as a flight risk since he was arrested almost two years ago.

The case has been fraught with drama, including a fight with an inmate over the use of a telephone, during which Stanford suffered a broken nose and a major concussion that left him unconscious. He also suffered an aneurysm in his leg.

The judge postponed the case a second time in January to allow Stanford to undergo drug rehabilitation in a prison facility to address an addiction to prescription anxiety drugs he acquired while jailed. Stanford has been undergoing detox treatment at the hospital unit at the federal prison in Butner, N.C., since mid-February.

Stanford has dismissed or been abandoned by at least five legal teams, all of which were unsuccessful in persuading the court to free him as he awaits trial. The current legal team was appointed after he was declared an indigent defendant. Attorneys and many of the principal players in the case declined to comment for this story, citing a gag order imposed by the judge.

In the meantime, new details have emerged in recent weeks about the SEC's delay in investigating the Stanford Group. A congressional subcommittee conducted a hearing in May on the agency's failures to stop the alleged Ponzi scheme. A former official accused of repeatedly blocking efforts to investigate the group now is the subject of a federal criminal inquiry for having done legal work for Stanford after leaving the SEC.

Spencer C. Barasch, now a private-sector lawyer in Texas, has represented clients dealing with the agency, including Stanford, despite being told multiple times by the SEC's ethics office that it was improper. He previously led the enforcement bureau in the SEC's Fort Worth office, and he had blocked efforts to pursue Stanford at least six times in a seven-year span in spite of repeated accusations of fraudulent behaviour, according to a report released last year by the SEC's inspector general. Barasch's law firm continues to say that he did not violate conflicts of interest.

"This is not even defensible," U.S. Rep. Randy Neugebauer, a Texas Republican who serves as the head of the House subcommittee, said at the conclusion of the hearing. "It is extremely disturbing that we had a culture in agencies that demand high levels of disclosure and integrity, that within that very agency there wasn't a similar amount of integrity."

Longtime SEC employee Julie Preuitt also testified at the hearing that she was reprimanded and demoted for reporting as early as 1997 that Stanford likely was operating a massive Ponzi scheme. An internal watchdog issued a report last year that concluded the agency had treated her improperly, she says, adding that "the commission has failed to discipline anyone, at least not visibly, nor has there been any effort to restore me to a position with similar duties and responsibilities to the one I held before. I paid a heavy price for complaining."

As far as Smith and other victims are concerned, the SEC is the true guilty party in the Stanford case. Their goal is to see the return of at least a portion of the money they lost.

"I would much prefer to see the SEC on trial," Smith says. "They're the true culprits: the people who allowed this to happen. I could care less about Allen Stanford. He's a liar, he's an evil person and he set out to steal money from investors from the very beginning.

"But the only reason I want him to be convicted is so that some of the other governmental entities in other countries holding up money will release it once there is a guilty verdict rendered against him."

Third Party Discovery of Foreign Bank Records Should First Proceed Under the Hague Convention

Where U.S. litigation discovery obligations were argued to be in conflict with foreign civil and criminal privacy statutes, many recent opinions found that discovery should proceed under the Federal Rules over the protest of the foreign data custodians. See, e.g., Gucci Amer., Inc. v. Curveal Fashion, No. 09 Civ. 8458, 2010 WL 808639 (S.D.N.Y. Mar. 8, 2010) (compelling the third-party U.S. parent of a foreign bank to produce documents located at its subsidiary despite claims that such production was illegal under Malaysian law) discussed further in prior blog posts here and here. However, in SEC v. Stanford International Bank Ltd, the court departed from this pattern in finding that discovery should first proceed under the Hague convention “in the interest of comity.” Civil Action No. 3:09–CV–0298–N, 2011 WL 1378470 at *14 (N.D.Tex. April 6, 2011).

In this case, the court previously determined that R. Allen Stanford, his associates, and various entities under Stanford's control (collectively “Stanford”) operated “a massive Ponzi scheme that stole approximately $8 billion from an estimated 50,000 investors scattered over more than 100 countries,” and accordingly, the Court appointed a Receiver to identify and take control of Stanford’s assets. Id. at *1. As third-party Société Générale Private Banking (Suisse) S.A. (“SocGen”) was believed to hold accounts belonging to Stanford, the Receiver sought to discover account records under the Federal Rules of Civil Procedure (“FRCP”). Id. at *2. SocGen, opposing discovery under the FRCP, argued that as the sought-after documents were located in Switzerland, compliance with the FRCP discovery request would “subject it and its employees to criminal, civil, and administrative penalties under Swiss law.” Id. Instead, SocGen argued that the Receiver should first utilize the discovery procedures of the Hague Convention, of which Switzerland is a signatory.

To determine under which mechanism discovery should proceed, the court applied the balancing of factors set out in Société Nationale Industrielle Aérospatiale v. U.S. District Court, 482 U.S. 522, 538, 107 S.Ct. 2542, 96 L.Ed.2d 461 (1987) (“Aérospatiale”) and Minpeco, S.A. v. Conticommodity Serv., Inc., 116 F.R.D. 517, 523 (S.D.N.Y. 1987). These factors include: (1) the importance to the litigation of the documents or other information requested; (2) the degree of specificity of the request; (3) whether the information originated in the United States; (4) the availability of alternative means of securing the information, (5) the competing interests of the nations whose laws are in conflict; (6) the hardship of compliance on the party or witnesses from whom discovery is sought; and (7) the good faith of the party resisting discovery under the Federal Rules. See id. at *4.

The court’s application of these factors was initially fairly typical. Factors 1, 2, and 4 were found to favor the Receiver, as the documents were “vital” to the receivership proceedings and not available anywhere else. In particular, the court noted that as it considered the Receiver to essentially be SocGen’s customer, the discovery request “constitutes no more than a bank customer asking for a copy of its own records.” Id. at *5-6, 8, and 11. Counseling the opposite conclusion, factors 3, 6, and 7 were found to favor SocGen, as the documents were only located in Switzerland; this defense was not raised in bad faith; and “comity counsels deference” to SocGen’s “potentially well-founded fear” that compliance with the discovery request under the Federal Rules could lead to prosecution. Id. at *7-8, and 12-13.

Where the Court’s analysis deviates significantly from other opinions is its consideration of the fifth factor, which in this case involves the competing interests of the U.S. and Switzerland. Whereas other courts found that U.S. discovery interests trumped foreign privacy concerns, the Stanford court found this factor to be neutral, after noting that any such balancing of interests would be “political” and “especially inapposite in this case, where the legislative authorities of both nations essentially have spoken by adopting the Convention.” Id. at *9. Compare id. (“the Convention inherently, and adequately, balances the competing sovereign interests here because its use will benefit U.S. interests by providing the needed evidence, and protect Swiss interests by avoiding intrusions upon Swiss sovereignty.”) with Gucci, 2010 WL at *7 (“[T]he Court concludes that the United States interest in fully and fairly adjudicating matters before its courts . . . outweighs Malaysia’s interest in protecting the confidentiality of its banking customers’ records.”).

On balance, the Stanford court found that the comity factors weighed in SocGen’s favor “at least in the first instance.” Id. at *13. Accordingly, the Receiver was to proceed with discovery under the Hague Convention, but was not precluded from renewing its request for discovery under the FRCP should its efforts be unsuccessful. Id. at *13-14. In so holding, the court acknowledged that others relied on the discretion provided by the Supreme Court in Aérospatiale as a “green light to generally ‘discard[ ] the treaty as an unnecessary hassle.’” Id. at *3 (citing In re Automotive Refinishing, 358 F.3d 288, 306 (3rd Cir. 2004)). However, this approach “ignores Aérospatiale's admonition to ‘exercise special vigilance’ in international discovery disputes . . . and exemplifies courts' intrinsic ‘proforum bias’ warned against by . . . the Aérospatiale minority.” Id.

While it is unclear the extent to which this approach will be followed by other courts in the future, this opinion illustrates that it is possible for litigants and third parties to successfully navigate cross border discovery conflicts even where privacy interests are at stake.

Stanford Investors Complaint Against BDO

BDO Complaint May 26 2011

Stanford Investors Sue Former Auditor BDO US for $10.7 Billion Over Fraud

BDO USA LLP and its parent, the ex- auditors of indicted financier R. Allen Stanford’s former company, were sued for $10.7 billion by investors claiming BDO ignored signs of potential fraud.


“Despite the pervasive fraud that infected Stanford Financial Group’s operations, BDO repeatedly issued unqualified audit opinions on its Stanford client’s annual financial statements,” Edward Snyder, a lawyer for Stanford investors, said in a complaint filed yesterday in federal court in Dallas.

Stanford’s companies “needed BDO’s unqualified audit opinions to satisfy securities regulators and to continue recommending” sales of the allegedly bogus certificates of deposit at Stanford International Bank Ltd. in Antigua, the investors said in the complaint.

U.S. Securities and Exchange Commission regulators seized Stanford’s operations in February 2009 on allegations they were involved in a “massive Ponzi scheme” that defrauded investors of more than $7 billion.

“We have yet to be served with the complaint and therefore are unable to comment at this time,” Jerry Walsh, a spokesman for BDO, said in an e-mail. “However, the fact that this complaint was not filed until now -- years after the Stanford fraud came to light and after many other investor complaints were filed -- reflects a transparent understanding that the allegations lack merit.”


Criminal Charges

Stanford, 61, has been incarcerated since June 2009 as a flight risk after he was indicted on parallel criminal fraud charges. He denies the charges and is scheduled for trial in federal court in Houston in September.

In addition to claims that auditors intentionally concealed fraudulent activity, the investors also contend four BDO executives played key roles in a Stanford-sponsored task force that assisted the Antiguan banking authorities in overhauling their banking regulations in the late 1990s, allegedly weakening them in ways that aided Stanford.

The Stanford task force rewrote Antigua’s money-laundering act “to ensure that ‘fraud’ and ‘false accounting’ did not fall under the Act’s prescribed list of violations,” the investors said. After the laws were rewritten in April 1999, the U.S. Treasury Department issued an advisory warning banks to give Antiguan financial transactions “enhanced scrutiny” because of money-laundering concerns, according to the complaint.


‘Speculative Investments’

The investors also accuse BDO auditors of ignoring signs Stanford’s company was operating as an unregistered hedge fund “illegally disguising itself as a bank.” They claim investors were sold hedge fund shares “disguised as CDs,” and that clients’ cash was pooled by Stanford’s company to make “illiquid, speculative investments” instead of the safe, liquid portfolio promised to clients.

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

The complaint, which seeks to represent all Stanford investors, was filed on behalf of three Texans who lost more than $3.2 million on certificates of deposit issued by Stanford’s Antiguan bank. They seek $10.7 billion in damages from BDO, which is what they calculate Stanford investors worldwide collectively lost on the Antiguan CDs.


The case is Wilkinson v. BDO USA LLP, 3:11-cv-1115, U.S. District Court, Northern District of Texas (Dallas).

SIB Gets New Joint Liquidators

Antigua St John's - The Stanford Investment Bank (SIB) has new liquidators, as decided by Justice Mario Michel of the Eastern Caribbean Court of Appeal earlier this month.

The new liquidators, Marcus A Wide of the British Virgin Islands and Hugh Dickson of the Cayman Islands, replace Nigel Hamilton-Smith and Peter Wastell.

Alexander Fundora is the Stanford International Bank Ltd creditor who led the action to appoint new liquidators.

In a recent statement, Hamilton-Smith said his team is now focused on ensuring a smooth handover, including all in-progress claims, to the new appointees.

He said, “The new liquidators will be able to continue the good work in recovering assets for investors – including land assets in Antigua, funds in Switzerland, funds in the UK, and other asset tracing claims that may arise in the future.”

The former joint liquidators had reportedly been able to agree 12,083 investor claims, totalling more than US$4 billion.

“Our primary aim now is to ensure that this progress is continued,” Hamilton-Smith said.

He advised that SIB investors should contact the new joint liquidators at stanford.enquiries@uk.gt.com This e-mail address is being protected from spambots. You need JavaScript enabled to view it for information about their claims.

The outgoing liquidators had previously provided an investor update on April 18, in which they outlined progress to date.

Wide and Dickson bring more than 60 years' combined experience in insolvency, and now specialize in offshore entities and complex and contentious cases. Wide in particular has liquidated over 30 failed banks in the Caribbean.

Stanford’s relationship with Congress

If the government’s assertions are true, Allen Stanford presided over a Ponzi scheme second only to Bernard Madoff’s in U.S. history. Stanford also sought to cultivate influence in Washington. Most of his campaign contributions occurred in two periods when his interests in legislation peaked: 2001-2002 and 2005-2008.

Statement from FRP Advisory LLP regarding Stanford International Bank (SIB) – in liquidation

16 May 2011


Following a claim made to the Eastern Caribbean Court of Appeal, Nigel Hamilton-Smith and Peter Wastell have been removed as Joint Liquidators to Stanford International Bank – in liquidation.


Nigel Hamilton-Smith said: "Our focus is now on ensuring an effective and speedy handover to the new Joint Liquidators, so that investors suffer no more delays. The new liquidators will be able to continue the good work in recovering assets for investors - including land assets in Antigua, funds in Switzerland, funds in the UK and other asset tracing claims that may arise in the future. We were able to agree 12,083 investor claims, totalling more than US$4 billion and our primary aim now is to ensure this progress is continued. All in-progress claims will be passed to the newly appointed Joint Liquidators, Marcus Wide and Hugh Dickson at Grant Thornton BVI. SIB Investors should contact stanford.enquiries@uk.gt.com for all investor enquiries going forward.


The previous Joint Liquidators provided an update for investors, published on 18 April 2011, outlining progress to date and this can be viewed in full at http://www.frpadvisory.com/stanford/update-from-the-joint-liquidators-of-stanford-international-bank-20110418.html

Stanford Ponzi Scheme Trial Set for September 12

The long awaited trial of accused Ponzi schemer Allen Stanford has been set for September 12, according to a new scheduling order issued Tuesday by U.S. District Judge David Hittner in Houston.

Stanford's trial had been set for January, but was postponed indefinitely after he became addicted to prescription drugs while in prison, and Hittner ruled he was incompetent to stand trial.

Since February, Stanford has been undergoing drug treatment at a prison hospital in Butner, North Carolina. His court-appointed attorney, Ali Fazel, would not comment on Stanford's condition, citing a gag order in the case.

The setting of a new trial date is the latest in a fast-moving series of events in the case.

Last week, a federal grand jury in Houston returned a new indictment against Stanford, reducing the number of counts he faces to 14 from 21, and removing four co-defendants from the case. They are to be tried separately.

Following the new indictment, Fazel informed the court that his client could not be arraigned on the revised charges since Stanford had been ruled incompetent.

But Hittner set the new schedule anyway, noting that the new indictment has "no basic changes in the relevant counts."

Stanford investors have been critical of delays in the case. With the criminal charges unresolved, most of his assets are in foreign accounts, off limits to U.S. authorities.

Breakdown of Ralph Janvey's Second Interim Fee

Below is a breakdown of Janvey's Fee's, it is an absolute disgrace and an insult to ALL Victims.

Doc671-4 Appendix to Receivers Second Interim Fee Sch Exh H-K80409

Update from the Joint Liquidators of Stanford International Bank - in Liquidation (SIB)

18 April 2011

Following the previous update on 16 December 2010, the Joint Liquidators of SIB, Nigel Hamilton-Smith and Peter Wastell, can confirm that an appeal date in respect of the removal proceedings has not yet been set.

As previously advised, whilst the case continues, the Joint Liquidators remain committed to recovering assets on behalf of SIB investors. They provide further information on the current position of the liquidation as follows:

Current position with investor claims and enquiries

 The Joint Liquidators have now agreed claims of 12,083 investors totalling over US$4 billion. The adjudication of claims received and enquiries from investors are being processed on a daily basis.

The Joint Liquidators continue to deal with email enquiries, responding to investor queries in both English and Spanish. Investors are now able to view their accounts, register their claims and change their address details via the Online Claims Management System.

All SIB investors, who have not yet registered their claim on the Online Claims Management System, should do so via the website at https://stanford.frpadvisory.com/, where their claims continue to be processed.

Assets located in Antigua, United States (US), Switzerland, Canada and the United Kingdom (UK)

Antigua
The Joint Liquidators are still working with their advisers on a full marketing strategy for the land assets, comprising:

• the freehold property occupied by the Eastern Caribbean Amalgamated Bank (Formerly Bank of Antigua) at Coolidge,
• leasehold property known as the Athletic Club,
• an island known as Pelican Island,
• an island known as Guiana Island, with approximately 1,500 acres of surrounding lands on the mainland, and
• two small plots of land at Coolidge.

There are a number of other properties in Antigua that investors have enquired about that are not owned by SIB, which are believed to be owned by other Stanford group companies. However, as the Joint Liquidators are not appointed over the other companies, they have no authority to deal with these assets. One of these companies has laid claim to the Athletic Club and resolution to ownership may be required through the Antiguan Courts.

Any claim that SIB ultimately funded the purchase of the properties not owned by SIB, will need to be made through the Antiguan Courts.

Once a co-operation agreement with the US Receiver (referred to below) is ratified by both courts in the US and Antigua, the Joint Liquidators can request further information on funds flow, to provide sufficient evidence to make a claim through the Antiguan Courts.

United States

As part of the agreement reached with the US Receiver, Mr Ralph Janvey, the Joint Liquidators would withdraw their application for Chapter 15 recognition in the US, and the US Receiver would withdraw his appeals against the decision to appoint the Joint Liquidators, made in April 2009 by the High Court in Antigua.

The co-operation agreement was concluded and is subject to Court approval in both the US and Antigua.

However, this agreement has not yet been approved by the Courts in either Antigua or the US (which is necessary for it to become legally binding), due to the requirement that there first be a resolution to the removal application brought by a Stanford investor.

Subject to the approval of both the Antiguan High Court and the US District Court, the US Receiver will deal with the realisation of the assets of SIB in the US and Canada. The Joint Liquidators will deal with the realisation of the assets of SIB located in Antigua and the UK. The co-operation agreement provides a platform for both parties to share information, to assist in their efforts to realise assets in the countries covered by the agreement.

Switzerland

There are funds held in various bank accounts in Switzerland, totalling approximately US$130 million. The financial regulator in Switzerland, FINMA, has recognised the Antiguan bankruptcy of SIB in preference to the US Receiver. The consequence of this Order means that a Swiss ancillary liquidation run by FINMA has commenced. The Joint Liquidators’ believe this liquidation will look to address the Swiss creditors first and then any balance will be passed to the Antiguan liquidation. The Joint Liquidators are currently in dialogue with FINMA. The decision is open to appeal by the US Receiver and, in addition, the US Department of Justice (DoJ) is also seeking control of the funds as proceeds of crime. The co-operation agreement referred to above does not include the assets held in Switzerland.

Canada

The Joint Liquidators made an application under the Bankruptcy & Insolvency Act in Canada for recognition of its appointment and control of the funds held in the country. At the same time, the US Receiver made the same application. During September 2009, the Superior Court of Quebec concluded that the US Receiver should be recognised as the office holder to whom control of the funds in Canada should be passed.

Legal counsel for the Joint Liquidators considered that the decision provided by the Court was erroneous and, accordingly, submitted an appeal that was heard during December 2009. The Court of Appeal upheld the initial decision of the Superior Court. The funds in Canada remain frozen following proceedings issued by the Attorney General in Ontario, Canada, again in relation to the monies being regarded as proceeds of crime.

Once again, the co-operation agreement referred to above, subject to Court approval, would mean the Joint Liquidators withdraw from any further litigation over the Canadian assets.

United Kingdom

The Court of Appeal upheld the judgment in favour of the Joint Liquidators that the Centre of Main Interest (COMI) of SIB is Antigua and Barbuda and that the funds held in the UK should come under their control.

The Court of Appeal also determined that the funds should remain subject to a restraint order granted in favour of the Serious Fraud Office (SFO) on behalf of the DoJ. The DoJ has sought that the funds be restrained, as they consider that the funds are proceeds of crime. In relation to a criminal restraint, the funds will remain restrained in the U.K and subject to the jurisdiction of the UK criminal court.

The Joint Liquidators consider that the decision to continue the criminal restraint is incorrect and creates a further delay in funds being available for return to the creditors of SIB. A hearing date for the application for leave to apply to the UK Supreme Court, in order to lift the restraint order, will not be made until resolution of the removal application brought by a Stanford investor.

The co-operation agreement referred to above, subject to Court approval, would mean the US Receiver will withdraw from any further litigation over the UK assets.

Dividend Prospects for Creditors

Until the recognition proceedings have been concluded and the land assets in Antigua are sold the Joint Liquidators are unable, at this stage, to estimate the level or timing of a distribution to creditors. However the assets traced to date are valued under US$1 billion against depositor liabilities of US$7.2 billion and although our investigations are ongoing we anticipate that there will be a significant shortfall to creditors.

Statement by Kachroo Legal Services

"Kachroo Legal Services, P.C. wishes to inform Stanford investors that despite slanderous representations it will not file amended claims for any Stanford investors unnecessarily and it is not our intention to do so, nor has it ever been. KLS is attempting to extend an offer to review your claim and if it is found to be lacking to amend it to participate in any potential class action we file. The review would be done free of charge. Note also that unlike the 30 percent contingency of other attorneys, KLS is charging a small up front stipend and only a 15 percent contingency fee upon recovery."


Please contact us IMMEDIATELY to review your claim so that you are included in the class action at wlugo@kachroolegal.com or by calling 617-864-0755.

Allen Stanford Receiver to Argue for SocGen Subpoena Feb. 28

Lawyers for R. Allen Stanford’s U.S. court-appointed receiver are scheduled to appear with those for a Societe Generale unit before a federal judge to resolve a dispute over subpoenaed records.

U.S. District Judge David Godbey in Dallas set a hearing for Feb. 28 to address the disagreement between the Lausanne, Switzerland-based unit of the Paris-based bank and the receivership overseeing the indicted financier’s businesses.

Citing Swiss banking secrecy laws, Societe Generale Private Banking (Suisse) SA has objected to receiver Ralph Janvey’s Dec. 13 subpoena demanding that the bank turn over all of its records after Jan. 1, 2000, for accounts held by Stanford personally or by his businesses.

“Production of the requested documents would force SG Suisse and its officers and employees to violate Swiss substantive law,” including laws prohibiting the release of the type of records Janvey seeks, the bank said in a Feb. 7 court filing.

Stanford, 60, is civilly and criminally accused by the U.S. of leading a $7 billion investment-fraud scheme through the sale of certificates of deposit by his Antigua-based Stanford International Bank Ltd. He has denied any wrongdoing.

The U.S. Securities and Exchange Commission filed its enforcement proceeding against the Texas financier two years ago Feb. 18. The receivership is recovering money to repay Stanford’s investors and creditors.

The SEC case is Securities and Exchange Commission v. Stanford International Bank Ltd., 09-cv-00298, U.S. District Court, Northern District of Texas (Dallas). The criminal case is U.S. v. Stanford, 09-cr-00342, U.S. District Court, Southern District of Texas (Houston).

DISMAY AS OFFICIAL STANFORD INVESTORS COMMITTEE FILE LAWSUIT AGAINST ST JUDE’S CHILDREN’S CANCER HOSPITAL CHARITY

On this day today, the second anniversary of the civil action by the SEC against the Stanford Financial Group, wholly owned by Allen Stanford awaiting trial on 23 counts of fraud in Texas, allegedly too incompetent to stand trial after being beaten-up in prison and fed a cocktail of anti-depressants. What have we learned?

Firstly Allen Stanford is apparently competent enough today to file a lawsuit against the US prosecutors, the FBI and SEC, accusing them of ‘abusive law enforcement’ and seeking $7.2bn in damages. Since he was declared indigenous after Lloyds of London contested their officer’s insurance policy, following the hiring and firing of a carousel of well tailored attorneys, he is now represented by two public defenders. It begs the question who is paying for his lawsuit, and how did he miraculously recover well enough to instruct them.

Now he has recovered, please let the criminal trial begin, and that $7.2bn would also be the same amount the innocent victims of the alleged Stanford fraud have lost. If he’s so innocent, where‘s the money?

On this day today, the Statute of Limitations for any lawsuits in connection with the Stanford case also expired.

Three months ago we woke up to the fact the so-called (SIC) Stanford Investors Committee was going to do nothing very much to help us, so we found a new attorney and launched our own campaign to file FTCA claims against the Securities and Exchange Commission (SEC), for their negligence in not closing down Stanford sooner. They knew he was a fraud 13 years ago. Some of the SEC were merely asleep on the job, while others were caught with their pants down watching porn on their computers. The campaign has been a resounding success, and several thousand Stanford investors have now filed claims.

On this day today, we also anticipated a flood of claims from the receiver and the (SIC) Stanford Investors Committee, who have reportedly been toiling away tirelessly for several months in total secrecy, all in our best interests.

We anticipated a plethora of lawsuits against, amongst others;

BDO Seidman, one of the worlds largest accounting firms, who audited Stanford Group Company, and who fudged their accounts four years running to hide from SIPC it was insolvent and only being supported by tainted funds from SIB in Antigua.

FINRA, who twice fined Stanford for misleading investors, a mere slap on the wrist, but despite all the red flags, could see no further..

The State of Florida, who through their Dept of Banking and Finance granted the newly formed (in 1998) Stanford Fiduciary Investor Services, the illegal right to move vast amounts of money offshore without the reporting a penny to regulators. Yes, Jeb Bush the brother of former President George W Bush became Governor of Florida earlier that same year, and both were recipients of generous campaign donations from Allen Stanford.

Greenburg Traurig, the deep pocketed Miami lawfirm who lobbied endlessly to set up Stanfords Florida deal, and who have been implicated in numerous other murky transactions.

Forbes, and who could forget their endorsement of Stanford as one of Americas richest 40 billionaires with $50bn under management. They gave Stanford his greatest aura of credibility.

One would have anticipated, with four experienced attorneys on the (SIC) Stanford Investors Committee; together with the examiner, the receiver, and Angela Shaw Kogutt, the director and founder of the SVC; these would all be rich pickings; but did they choose to file any suits against any of these? No, not one.

On this day today, sadly, we learned they chose instead to file a suit against St Jude’s, the children’s cancer research hospital charity who give hope to sick children and their families. Allen Stanford donated $7m towards St Jude’s, quite possibly the only truly good deed the ‘Knight’ ever did. No matter where those funds came from, there is one indisputable fact; St Jude’s received and spent them in good faith to keep a lot of sick kids alive, and who can begrudge them that?

On this day today, it should have been the day we were all celebrating having made the first step towards recovery from the US Government, who knew for 13 years that Allen Sanford was a fraud, but did nothing. Instead I am sickened that the Stanford Investors Committee, who supposedly act in our best interests, could have instigated such a callous and insensitive action against such a deserving institution as St Jude’s without our knowledge, and without our consent.

To all the Stanford investors reading this, I urge you to write or email the Stanford Investors Committee members to withdraw this suit against St Jude’s. In the eyes of the world we are all as equally guilty as those undeserving members of the committee who are behind it. Please let us do one good thing and make this right.

Thank you

Richard

LAST CHANCE TO SUBMIT CLAIMS AGAINST THE SEC

This is a reminder that time is running out. If you are going to submit a claim please make sure you do it this week.

I spoke to Dr Kachroo this morning and she asked me to remind everyone who is going to sign with KLS, and all of you who who have requested a copy of their engagement letter, to please make sure you sign and return it THIS WEEK together with the amount of your claim, and a copy of your statement, to ensure there is time to process all of your claims before the deadline.

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Este es un recordatorio de que el tiempo se acaba. Si usted va a presentar una reclamación por favor asegúrese de hacerlo de esta semana.

Hablé con el Dr. Kachroo esta mañana y me pidió que recordar a todo el que va a firmar con KLS, y todos los que que han solicitado una copia de su carta de compromiso, que por favor asegúrese de firmar y regresar esta semana junto con el monto de su reclamo, y una copia de su declaración, asegurarse de que existe tiempo para procesar todas sus reclamaciones antes de la fecha límite.

Richard Watson
31st January 2011

ONLY TWO WEEKS NOW BEFORE THE DEADLINE FOR STANFORD FINANCIAL GROUP INVESTORS EXPIRES

The deadline for FTCA claims by investors of the failed Stanford Financial Group against the US Securities and Exchange Commission is now just 18 days.

Investors in the failed Stanford International Bank, a part of the Stanford Financial Group, in receivership since the arrest of Allen Stanford, who is currently in detention in Houston awaiting trial on 23 charges of fraud, have just two weeks left to submit administrative claims under the Federal Tort Claims Act against the US Securities and Exchange Commission, for their negligence in not closing down Allen Stanford sooner, despite knowing for 13 years it was likely he was operating a Ponzi scheme. Had they done so earlier many thousands of investors would have been spared the loss of their life savings.

The deadline for claims is fast approaching. Unless claims are submitted correctly and timely, and delivery receipted by the SEC before the two year Statute of Limitations expires, on the 16th February 2011, Stanford investors will be denied any recovery from the US government, forever.
Stanford investors have engaged an attorney to submit FTCA claims against the SEC. This action against the SEC is a real chance for full recovery of losses from the failed Stanford Financial Group. It will not prejudice any SIPC recovery efforts, and is open to all the Stanford investors, irrespective of nationality, or place of residence.

CLAIMS TAKE SEVERAL DAYS TO PROCESS AND MUST BE SUBMITTED CORRECTLY AND TIMELY BEFORE THE 16th FEBRUARY OR THEY WILL BE REJECTED


Any Stanford investors who have not yet decided, should contact their attorney at their earliest opportunity, or the attorney the Stanford investors have hired: Kachroo Legal Services of Cambridge, Mass, who already have considerable experience of submitting FTCA claims on behalf of the Madoff investors. Email: info@kachroolegal.com

Should any Stanford investors wish for more detail of the campaign and the various arguments, please register for our private investor’s forum, which is free of charge and available to all bona-fide investors in the failed Stanford Financial Group: http://svg.creatuforo.com/profile.php?mode=register

Deadline for Stanford investors less than a month away

Antigua (Antigua Observer): The Stanford International Victims Group (SIVG) is reminding non-US investors of the approaching deadline to file their claims for compensation. February 16, 2011 is the date when the statute of limitations expires for claims to be filed under the US Federal Tort Claims Act (FTCA). The SIVG represents investors from outside the US who were burned in Allen Stanford’s failed $7 billion Ponzi scheme, for which the businessman now languishes in a Texas prison awaiting trial.

The international victims have so far met with little success in their attempts to seek compensation via the Securities Investor Protection Corporation (SIPC). This is partly because they are vigorously opposed by the Stanford Victims Coalition (SVC), which is looking after the interests of only the US investors. SVC holds the view that interventions on behalf of the international victims distracts attention from the primary US cause and is likely to delay settlement. The SIPC itself is also resistant to the idea of paying out compensation to the international victims, most of whom were not registered with the broker that is recognised as legitimate by US authorities in this matter, namely the Stanford Group Company (SCG).

Only 8,000 of the 13 to 20,000 Stanford investors are eligible for cover under the Securities Investor Protection Act (SIPA) – which governs the SIPC – and these are almost all in the US. The SIPC offers compensation only up to a limit of US $500,000, regardless of the amount that may have been lost in Stanford’s alleged fraud. On the other hand, a successful claim under the SIPA would guarantee full compensation. The International Investors Group is urging non-US victims (including those in Antigua & Barbuda) to contact their attorneys as soon as possible, or the attorney submitting claims on behalf of international investors, Kachroo Legal Services of Cambridge, Massachusetts. (January 25, 2011)

OPEN LETTER TO STANFORD INVESTORS REGARDING FTCA CLAIMS AGAINST THE UNITED STATES SECURITIES AND EXCHANGE COMISSION

Dear Stanford Investors,

There have been some very critical accusations from some of the Stanford investor groups; some of their attorneys; and even the Stanford investors committee; relating to the Stanford FTCA claims, some of which are clearly intended to discredit the investors behind this effort to inform and encourage you to preserve your rights to claim against the SEC, by filing an administrative claim.

As one of the instigators of this course of action, I think it is time that some of the false and misleading claims are put to rest, and suggest that searching questions be raised of the motivation of some of the individuals who are behind these accusations.

On the 15th November 2010, little more than two months ago, I wrote to the Stanford Investors Committee (SIC) and enquired if they had any intention of taking any action against the SEC, given the damning OIG report and the pending expiration of the statute of limitations. I still await a reply to that letter; however, following a later discussion with one of the attorney members of that committee, it was apparent the committee had no intention of commencing any such action to protect us.

Shortly afterwards, I got together with a small group of like-minded investors to search for a new attorney to represent us in a claim against the SEC. First there were attempts to have us gagged, which we had to overcome. Since then we have worked night and day, to bring together a workable solution that may benefit all the Stanford investors.

The number of attorneys with relevant experience of successful claims against the SEC are few. Lengthy discussions followed with Dr Gaytri Kachroo of Kachroo Legal Services (KLS), following the FTCA claims KLS had submitted for 500 Madoff investors, and we were all impressed; not just by her excellent academic achievements, but by the way she had reached the higher echelons of her chosen profession, yet managed to maintain a caring attitude; was willing to go the distance for us, and most importantly, had already represented investors in two actions against the SEC and/or the US government to successful settlement, and had very plausible arguments that we may succeed with an FTCA claim against the SEC.

Around the same time Angela Kogutt aka Angela Shaw, of the Stanford Victims Coalition (SVC) also approached Dr Kachroo, having seen the press releases relating to the Madoff victims claims. The support of the SVC was initially proffered, and Dr Kachroo was invited to address the SIC, with a view to filing protective FTCA claims for each of the Stanford investors. At that meeting, SIC attorneys all indicated they had no intention of themselves pursuing an action against the SEC because they were all involved in litigating other actions for Stanford investors. They considered Dr. Kachroo to be optimally positioned to take on this action. This created some hope that all Stanford investors could commonly join in the SEC claims process through one channel and action. Covisal, in Latin America, was also invited around this time to participate in the process.

I have no wish to dwell over all the water that has passed under the bridge since then, but our initial hopes that this action may unite all the various investor associations in a common cause were clearly misplaced.

Instead, we have been subjected to a barrage of defamatory internet attacks, mostly anonymous; including accusations of impropriety, amongst many others, all intended to discredit us. Investors who have exercised their right to join us have been threatened, and apparently some of us are now to face legal action.

I could have understood if these attempts to discredit us, and threats of legal recourse, had been at the instigation of the institution we hold responsible for our losses, but I am dismayed they are almost entirely from individuals who purport to be working in the best interests of the Stanford investors. How can they claim to be doing so by trying to silence us? What is the motivation behind these attacks, and why are they reluctant for Stanford investors to preserve their rights to any recovery?

Since we embarked on this course of action, all we have ever wished, is to make as many Stanford investors as possible aware of this possibility for recovery, and enable your to make your own educated decisions how best you may preserve your rights of recovery against the SEC, before the statute of limitations expires.

As far as the Stanford Investors Committee is concerned, I really would like to know why the preservation of all Stanford investors' interests was not encouraged by them long before, and why exactly are SIC members only now purporting to do so now, at the last moment, and then only after our attorney has agreed to take the case? If that committee really is acting in our best interests, why do they refuse to support the one attorney who truly believes in our cause? Furthermore, if we had not instigated this action, would they have simply allowed the statute of limitations to slip quietly by, and all the investor’s rights along with it?

To those investors who have decided to ‘self-file’ their own claims, I wish you well, and hope you have done your research. If you have not, and have allowed yourselves to be railroaded into an action you do not fully understand, and it all goes wrong, who will you blame; yourself, or those who persuaded you it was easy to do it yourself?

To those investors who understand the risks, yet have chosen to file with a different attorney, I wish you well too, yet I do not understand why any investor would willingly choose an attorney who is not prepared to litigate their claim.

To the investors who have joined us, and have realized the common sense of registering with KLS, I wish you the best of all. It is your willingness to participate that has created the critical mass we needed to ensure this action can now go all the way. Thank you all.

To those of you who have yet to decide what is best for yourselves, please make your decision sooner rather than later. You have less than three weeks before the statute of limitations expires, after which you will be barred forever from claiming your losses against the SEC, and if you decide to join us you are all very welcome. Here is Kachroo Legal Services email one last time: info@kachroolegal.com and if you wish to read more of the arguments and discussions, please visit http://stanfordsforgottenvictims.blogspot.com or register for our private forum, which is free of charge and open to all bona-fide Stanford investors: http://svg.creatuforo.com/profile.php?mode=register


Lest anyone else allege I am hiding behind any facades, here is my email address, and I will strive to get back to everyone who may be interested enough to drop me a line, time permitting:

stanfordvictim.richard@gmail.com

Richard Watson
27th January 2011

Angry Investors Threaten Suit

Plaintiffs Claim Regulators Ignored Warnings of Fraud

By BILL LODGE
Advocate Staff Writer

Some of the investors alleged to have been defrauded by Texas
promoter Robert Allen Stanford say they will use a
Massachusetts lawyer to sue the federal government for
alleged failure to take timely regulatory action against him.

I believe we’re going to join this lawsuit,” said Baton Rouge
real estate investor Jason S. Graham, 39.

Graham is one of more than 1,000 residents of the Baton
Rouge, Lafayette and Covington areas who lost an estimated
combined total of more than $1 billion to Stanford’s
operations. Those estimates are by state Rep. Bodi White, RCentral,
and Baton Rouge attorney Phillip W. Preis.

We’ve waited for the last two years for our Congress people
and senators to help us,” said Graham. “It’s an absolute joke.
”
Graham already is a plaintiff in a civil lawsuit against the
people who marketed Stanford’s worthless certificates of
deposit and other investment vehicles in Louisiana.

That lawsuit and similar actions across the country, however,
were suspended more than a year ago on orders from a Dallas
federal judge.

U.S. District Judge David Godbey ruled that those lawsuits
would interfere with a court-appointed receiver’s efforts to
track down the remnants of Stanford’s assets.

But attorney Gaytri Kachroo, of Cambridge, Mass., filed a
class-action suit against the federal government in November
for alleged failure by the Securities and Exchange Commission
to protect people’s savings from New Yorker Bernard Madoff’s
admitted Ponzi scheme.

A Ponzi is an illegal investment scheme that involves few, if
any, actual investments. Early investors are paid dividends
described by Ponzi operators as profits. The money actually
comes from later investors.

The scheme collapses when promoters can no longer coax
money from newly targeted victims.

Madoff is serving a 150-year term in federal prison for bilking
billions of dollars from pension funds, mutual funds and indidual investors.

The scheme collapses when promoters can no longer coax money from newly targeted victims.

Madoff is serving 150-year term in federal prison for bilking billions of dollars from pension funds, mutual funds and individual investors.

Kachroo said she now is filing administrative law claims with
the SEC in the Stanford case in order to preserve the rights of
people in Louisiana and other states to file a class-action suit
against the commission after the Feb. 16 filing deadline. That
date will mark the second anniversary of the SEC’s action to
shut down Stanford’s worldwide operations.

In such cases, plaintiffs cannot sue the federal government
until after a federal agency has denied investors’ claims,
Kachroo said.

Kachroo said last week that she has filed with the SEC claims
by 30 Stanford investors. Another 270 claims were being
processed by her staff, she said.

SEC lawyers in Dallas and federal prosecutors in Houston
allege in court filings that Stanford operated a Ponzi scheme
that harvested at least $7.2 billion from more than 25,000
people from Baton Rouge to Bogota, from Venezuela to
Europe.

Stanford, 60, remains in federal custody in Houston, where he
faces federal fraud charges.

James M. Davis, a Baldwyn, Miss., resident who served as
Stanford’s chief financial officer, has pleaded guilty to felony
charges and admitted that Stanford’s operations were a huge
Ponzi from the beginning.

Whistleblowers ignored?

For nearly nine years before Madoff admitted that his
investment empire was a giant Ponzi, financial analyst and
certified fraud examiner Harry Markopolos had warned the
SEC that the man was a criminal.

Kachroo represented Markopolos when he testified Feb. 4,
2009, before the U.S. House of Representatives’ Committee on
Financial Services.

“Every tool, every resource, and every person (in the SEC) has
to be brought to bear in the fight against white-collar crime,”
Markopolos testified. “Government has coddled, accepted and
ignored white-collar crime for too long.
”
Markopolos added: “It is time the nation woke up and
recognized that it’s not the armed robbers or drug dealers who
cause us the most economic harm.

“It’s the white-collar criminals living in the most expensive
homes and who have the most impressive resumes who harm
us the most,” Markopolos told members of Congress. “They
steal our pensions, bankrupt our companies and destroy
thousands of jobs, ruining countless lives.
”
Last year, SEC Inspector General David Kotz reported that
commission officials repeatedly failed to pursue whistleblower
allegations between 1997 and 2005 that Stanford was
defrauding his investors. During that same time, Kotz
reported, examiners in the SEC’s Fort Worth office called for
investigation of Stanford at least three times.

In Baton Rouge, Preis continues to pursue a civil lawsuit on
behalf of Stanford investors against the state Office of
Financial Institutions. That suit alleges that OFI officials failed
investors by ignoring warning signs that Stanford’s operations
were fraudulent.

Preis said last week he believes that suit has a chance of
success, but he asserted that Kachroo has picked too big a rival
in the Stanford and Madoff litigation.

“We don’t think the idea of pursuing a suit against the SEC has
much merit to it,” Preis said. “The chances of ever collecting
from the United States government are slim to none.
”
Katchroo said she believes ordinary people can fight City Hall
and even collect damages from the federal government in the
Stanford and Madoff tragedies.

We believe we have a fairly good chance in both cases,”
Kachroo said.

The SEC won’t talk about Kachroo’s efforts in either case.
“
"Decline comment on both,"” e-mailed SEC spokesman John J.Nester.

Stanford was scheduled for trial on his criminal charges this
month. But a federal judge in Houston postponed that trial
indefinitely after being informed that Stanford has become
addicted to painkillers while in federal custody.