Source: Kit Chellel (Bloomberg)
The firm originally appointed to wind up R. Allen Stanford’s bank charged $18 million in fees while recovering around $300,000 for victims of the fraud, according Grant Thornton LLP, the bank’s new liquidator which is seeking to have the bill reduced.
Grant Thornton partner Hugh Dickson said his firm was challenging the Vantis Plc bill in an Antigua court. “We are trying to reduce that number considerably,” he said.
Vantis, which was removed as Antiguan liquidator of Stanford International Bank in May, has asked a court to approve its fees. The firm recovered around $300,000 of assets before being replaced, Grant Thornton said in a Web presentation to Stanford creditors and victims yesterday.
Efforts in the U.S. and Antigua to unwind Stanford’s alleged $7 billion Ponzi scheme have produced little to return to victims and creditors. As of January, U.S-appointed receiver Ralph Janvey had freed up $94.7 million in cash and filed lawsuits with a potential value of $595 million. Stanford is in custody in the U.S and is to be tried for fraud next year.
An Antiguan judge replaced Vantis in May following a request by creditors. Vantis went into administration last year. Its business-recovery operations were bought out by former managers and was renamed FRP Advisory LLP.
“We are in dialogue with Grant Thornton regarding the costs incurred prior to them taking office,” FRP partner Nigel Hamilton Smith said. “Our main objective is to find a sensible solution, which does not result in lengthy court time and further delays.”
Grant Thornton has identified up to $1.5 billion which it wants to return to more than 20,000 Stanford victims and creditors it represents, the firm said yesterday. That figure includes property valued at $300 million, securities worth $250 million and potential returns of as much as $1 billion from lawsuits.
Showing posts with label Vantis. Show all posts
Showing posts with label Vantis. Show all posts
Wednesday, 12 October 2011
Thursday, 18 August 2011
S.E.C. Files Were Illegally Destroyed, Lawyer Says
August 17, 2011
By EDWARD WYATT - New York Times
An enforcement lawyer at the Securities and Exchange Commission says that the agency illegally destroyed files and documents related to thousands of early-stage investigations over the last 20 years, according to information released Wednesday by Congressional investigators.
The destroyed files comprise records of at least 9,000 preliminary inquiries into matters involving notorious individuals like Bernard L. Madoff, as well as several major Wall Street firms that later were the subject of scrutiny after the 2008 financial crisis, including Goldman Sachs, Lehman Brothers, Citigroup and Bank of America.
The S.E.C. is the very agency that is charged with making sure that Wall Street firms retain records of their own activities, and has brought numerous enforcement cases against firms for failing to do so.
The agency's records were routinely destroyed under an S.E.C. policy, since changed, that called for the disposal of records of a preliminary inquiry that was closed if it did not get upgraded to a formal investigation, according to Congressional records and people involved in inquiries into the matter. The agency believes that both the original policy and the new rules comply with federal document-retention laws.
John Nester, an S.E.C. spokesman, said that while the agency was not required to retain all documents, it changed its policy last year regarding destruction of files for "matters under investigation," the category of initial inquiry by the S.E.C.'s enforcement division that is the subject of the current scrutiny.
Changes were made to the S.E.C. policy after questions about the document destruction were raised in early 2010 by Darcy Flynn. Mr. Flynn, an employee of the S.E.C.'s enforcement division for 13 years, began a new job in January 2010 helping to manage the disposition of records for the division. Mr. Flynn, who continues to work at the S.E.C., has sought protection under federal whistle-blower laws.
The document disposal, which was first reported by Rolling Stone magazine on Wednesday, is the subject of inquiries by the Senate Judiciary Committee; the National Archives and Records Administration, which oversees laws governing federal agency records; and the inspector general of the S.E.C., according to the records and to people involved in the investigations.
In addition to whether the document disposal violated federal laws about government records, officials are concerned that the S.E.C. policy might have hindered later investigations into the same people or companies or covered up wrongdoing.
"These records may contain critical information that could be extremely useful in piecing together complex cases, even if not immediately pursued," Senator Charles E. Grassley, an Iowa Republican who is the ranking member on the Senate Judiciary Committee, wrote in a letter to the S.E.C. on Wednesday.
Mr. Nester declined to comment on Mr. Grassley's letter or on a letter to Mr. Grassley from a lawyer for Mr. Flynn that laid out the allegations in detail.
H. David Kotz, the S.E.C. inspector general, said that he was investigating the issue and hoped to complete a report by the end of September. A spokesman for the National Archives did not respond to requests for comment late Wednesday afternoon.
The National Archives wrote to the S.E.C. last year, saying that it "appears that there has been an unauthorized disposal of federal records," and asked for further information, according to Mr. Flynn's chronology.
Mr. Flynn said that S.E.C. officials discussed whether to lie about the document destruction because they might be open to criminal liability. Unlawful and willful destruction of federal records is punishable by up to three years in prison.
The S.E.C. replied to the National Archives in a letter, saying that it was "not aware of any specific instances of the destruction of records" that should have been retained. It added that it "cannot say with certainty that no such documents have been destroyed over the past seventeen years."
The letter from Mr. Flynn's lawyer said that the old document destruction policy gave S.E.C. officials assurance that if they closed an inquiry without upgrading it to a formal investigation, there would be no record of their actions.
It is common for S.E.C. employees to leave the agency for the private sector and then begin representing clients before the agency. Mr. Flynn contends that the practice increases the likelihood that S.E.C. investigators could do undetected favors for former colleagues and their clients by quashing investigations.
Whether that revolving door led to the closing of an investigation in 2001 involving Deutsche Bank and the destruction of the files is part of the investigation by the S.E.C.'s inspector general.
By EDWARD WYATT - New York Times
An enforcement lawyer at the Securities and Exchange Commission says that the agency illegally destroyed files and documents related to thousands of early-stage investigations over the last 20 years, according to information released Wednesday by Congressional investigators.
The destroyed files comprise records of at least 9,000 preliminary inquiries into matters involving notorious individuals like Bernard L. Madoff, as well as several major Wall Street firms that later were the subject of scrutiny after the 2008 financial crisis, including Goldman Sachs, Lehman Brothers, Citigroup and Bank of America.
The S.E.C. is the very agency that is charged with making sure that Wall Street firms retain records of their own activities, and has brought numerous enforcement cases against firms for failing to do so.
The agency's records were routinely destroyed under an S.E.C. policy, since changed, that called for the disposal of records of a preliminary inquiry that was closed if it did not get upgraded to a formal investigation, according to Congressional records and people involved in inquiries into the matter. The agency believes that both the original policy and the new rules comply with federal document-retention laws.
John Nester, an S.E.C. spokesman, said that while the agency was not required to retain all documents, it changed its policy last year regarding destruction of files for "matters under investigation," the category of initial inquiry by the S.E.C.'s enforcement division that is the subject of the current scrutiny.
Changes were made to the S.E.C. policy after questions about the document destruction were raised in early 2010 by Darcy Flynn. Mr. Flynn, an employee of the S.E.C.'s enforcement division for 13 years, began a new job in January 2010 helping to manage the disposition of records for the division. Mr. Flynn, who continues to work at the S.E.C., has sought protection under federal whistle-blower laws.
The document disposal, which was first reported by Rolling Stone magazine on Wednesday, is the subject of inquiries by the Senate Judiciary Committee; the National Archives and Records Administration, which oversees laws governing federal agency records; and the inspector general of the S.E.C., according to the records and to people involved in the investigations.
In addition to whether the document disposal violated federal laws about government records, officials are concerned that the S.E.C. policy might have hindered later investigations into the same people or companies or covered up wrongdoing.
"These records may contain critical information that could be extremely useful in piecing together complex cases, even if not immediately pursued," Senator Charles E. Grassley, an Iowa Republican who is the ranking member on the Senate Judiciary Committee, wrote in a letter to the S.E.C. on Wednesday.
Mr. Nester declined to comment on Mr. Grassley's letter or on a letter to Mr. Grassley from a lawyer for Mr. Flynn that laid out the allegations in detail.
H. David Kotz, the S.E.C. inspector general, said that he was investigating the issue and hoped to complete a report by the end of September. A spokesman for the National Archives did not respond to requests for comment late Wednesday afternoon.
The National Archives wrote to the S.E.C. last year, saying that it "appears that there has been an unauthorized disposal of federal records," and asked for further information, according to Mr. Flynn's chronology.
Mr. Flynn said that S.E.C. officials discussed whether to lie about the document destruction because they might be open to criminal liability. Unlawful and willful destruction of federal records is punishable by up to three years in prison.
The S.E.C. replied to the National Archives in a letter, saying that it was "not aware of any specific instances of the destruction of records" that should have been retained. It added that it "cannot say with certainty that no such documents have been destroyed over the past seventeen years."
The letter from Mr. Flynn's lawyer said that the old document destruction policy gave S.E.C. officials assurance that if they closed an inquiry without upgrading it to a formal investigation, there would be no record of their actions.
It is common for S.E.C. employees to leave the agency for the private sector and then begin representing clients before the agency. Mr. Flynn contends that the practice increases the likelihood that S.E.C. investigators could do undetected favors for former colleagues and their clients by quashing investigations.
Whether that revolving door led to the closing of an investigation in 2001 involving Deutsche Bank and the destruction of the files is part of the investigation by the S.E.C.'s inspector general.
Tuesday, 9 August 2011
LG wins high-profile role on Stanford Bank liquidation
By Suzi Ring - legalweek.com
LG has won a high-profile role to advise the newly-appointed liquidators of Stanford International Bank (SIB) following its 2009 collapse amid a billion-dollar fraud scandal.
The UK law firm is acting for accountancy firm Grant Thornton, which was appointed to handle the liquidation in May after former liquidator Vantis was removed in June last year.
SIB founder Allen Stanford (pictured) is currently in prison awaiting trial after being charged in 2009 with defrauding investors with a $7bn (£4.3bn) Ponzi scheme run out of the bank.
LG is advising on all UK matters concerning SIB’s assets in London, including the $110m (£68m) of assets currently restrained by the Serious Fraud Office on behalf of the US Department of Justice.
LG senior partner Andrew Witts said: “We are delighted to be retained by Grant Thornton in this matter. It is clearly an important case, which raises potentially interesting issues of law on priority over the SIB assets in London, which are currently the subject of a restraint order.”
SIB collapsed in 2009 after Stanford, Stanford Financial Group chief financial officer James Davis and chief investment officer Laura Pendergest-Holt were subject to fraud charges relating to an alleged Ponzi scheme thought to have affected tens of thousands of depositors worldwide.
Vantis, which was formerly advised by CMS Cameron McKenna, was removed as the liquidator of SIB last year by an Antiguan court before later going into administration.
LG has won a high-profile role to advise the newly-appointed liquidators of Stanford International Bank (SIB) following its 2009 collapse amid a billion-dollar fraud scandal.
The UK law firm is acting for accountancy firm Grant Thornton, which was appointed to handle the liquidation in May after former liquidator Vantis was removed in June last year.
SIB founder Allen Stanford (pictured) is currently in prison awaiting trial after being charged in 2009 with defrauding investors with a $7bn (£4.3bn) Ponzi scheme run out of the bank.
LG is advising on all UK matters concerning SIB’s assets in London, including the $110m (£68m) of assets currently restrained by the Serious Fraud Office on behalf of the US Department of Justice.
LG senior partner Andrew Witts said: “We are delighted to be retained by Grant Thornton in this matter. It is clearly an important case, which raises potentially interesting issues of law on priority over the SIB assets in London, which are currently the subject of a restraint order.”
SIB collapsed in 2009 after Stanford, Stanford Financial Group chief financial officer James Davis and chief investment officer Laura Pendergest-Holt were subject to fraud charges relating to an alleged Ponzi scheme thought to have affected tens of thousands of depositors worldwide.
Vantis, which was formerly advised by CMS Cameron McKenna, was removed as the liquidator of SIB last year by an Antiguan court before later going into administration.
Friday, 17 June 2011
All International Victims need to read this and comment!!
I have attached a link that all International victims should go to and add a comment. You will see that there are comments from some victims lucky enough to be eligible for SIPC.
This site is being read by Congressman Culbertson and we can use the comment space to make him aware of what the cost of SIPC will be to all the International Victims. We now have to start our own campaign to make sure the coverage of SIPC is extended to include each and every one of us because WE are going to be the ones repaying SIPC for every investor they give money to. I have already heard rumours that SIPC are looking at the assets in Antigua, Switzerland and the UK. This is our money and it is all we have (Janvey has next to nothing). If SIPC are targeting ALL the assets, then they have to pay ALL of the victims.
WE have a new battle on our hands and we need to start making a noise and making sure that not just Congressman Culbertson but all the newspapers are told the true cost of this proposal to the majority of victims.
Here is the link, please go it it and start posting comments:
http://www.texasinsider.org/?p=48593&cpage=1#comment-47938
This site is being read by Congressman Culbertson and we can use the comment space to make him aware of what the cost of SIPC will be to all the International Victims. We now have to start our own campaign to make sure the coverage of SIPC is extended to include each and every one of us because WE are going to be the ones repaying SIPC for every investor they give money to. I have already heard rumours that SIPC are looking at the assets in Antigua, Switzerland and the UK. This is our money and it is all we have (Janvey has next to nothing). If SIPC are targeting ALL the assets, then they have to pay ALL of the victims.
WE have a new battle on our hands and we need to start making a noise and making sure that not just Congressman Culbertson but all the newspapers are told the true cost of this proposal to the majority of victims.
Here is the link, please go it it and start posting comments:
http://www.texasinsider.org/?p=48593&cpage=1#comment-47938
Thursday, 16 June 2011
Stanford International Bank liquidators seek to unfreeze funds
The newly appointed liquidators of Stanford International Bank (SIB), Marcus Wide and Hugh Dickson, announced yesterday that they hope to reach a compromise with various governments, including the US Department of Justice, to unfreeze hundreds of millions of dollars in assets in an effort to recover the billions lost by the more than 27,000 creditors of SIB.
“The estate has virtually no funds, but is saddled with obligations that exceed money on hand. Convincing government officials around the world to unfreeze the funds is a top priority,” a press release said.
“We hope to meet with the Department of Justice to understand the reasoning behind their approach and see if a compromise can be reached which will allow the estate to go forward with its own funds, and therefore maximise returns to creditors,” Dickson said.
“To have access to the bank’s own funds presently frozen by the criminal forfeiture proceedings would generate a considerable value to the estate in terms of allowing additional recovery and asset realisations to maximise recoveries,” he added.
The duo, the release said, have contacted officials from the Serious Fraud Office in the United Kingdom, the Prosecutor and Bankruptcy Trustee in Switzerland, and officers of the Attorney General of the Province of Ontario, Canada in recent weeks.
“Our objective has been to determine in the quickest time possible how the financial interests of the account holders, CD holders, and general creditors of the bank are best served,” Wide said.
“We have also been in contact with the US Department of Justice, the US Receiver, and the Creditors’ Committee for the US Receivership, with a view towards meeting with them once we have a better understanding of the issues between them and the SIB liquidation in Antigua,” the communiqué continued.
Dickson and Wide, who by order of the High Court last month replaced Nigel Hamilton-Smith and Peter Wastell as liquidators, also said they are considering the sale of real estate holdings in Antigua and are in the process of forming an advisory creditors committee, the release noted.
“These holdings are extensive and it is likely their value can be greatly enhanced if they are brought to market in an orderly manner over a period of time,” Dickson said.
“The estate has virtually no funds, but is saddled with obligations that exceed money on hand. Convincing government officials around the world to unfreeze the funds is a top priority,” a press release said.
“We hope to meet with the Department of Justice to understand the reasoning behind their approach and see if a compromise can be reached which will allow the estate to go forward with its own funds, and therefore maximise returns to creditors,” Dickson said.
“To have access to the bank’s own funds presently frozen by the criminal forfeiture proceedings would generate a considerable value to the estate in terms of allowing additional recovery and asset realisations to maximise recoveries,” he added.
The duo, the release said, have contacted officials from the Serious Fraud Office in the United Kingdom, the Prosecutor and Bankruptcy Trustee in Switzerland, and officers of the Attorney General of the Province of Ontario, Canada in recent weeks.
“Our objective has been to determine in the quickest time possible how the financial interests of the account holders, CD holders, and general creditors of the bank are best served,” Wide said.
“We have also been in contact with the US Department of Justice, the US Receiver, and the Creditors’ Committee for the US Receivership, with a view towards meeting with them once we have a better understanding of the issues between them and the SIB liquidation in Antigua,” the communiqué continued.
Dickson and Wide, who by order of the High Court last month replaced Nigel Hamilton-Smith and Peter Wastell as liquidators, also said they are considering the sale of real estate holdings in Antigua and are in the process of forming an advisory creditors committee, the release noted.
“These holdings are extensive and it is likely their value can be greatly enhanced if they are brought to market in an orderly manner over a period of time,” Dickson said.
Thursday, 26 May 2011
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.
Friday, 25 February 2011
I Obtained an Update from Vantis
I called into the SIB building yesterday and spoke to Sara Cook from Vantis to try and find out what was going on and when we can expect some sort of solution regarding the receivership on Antigua. It would appear that there is no final decision or court date in sight to settle this matter and she says they will keep appealing to any court decision that tries to oust them from their position as receivers.
I also asked about the properties on the island and why Andrea Stolker (Stanford Fiancee') was being allowed to open properties that clearly were paid for with SIB money and she said the Stolker has power of Attorney from Stanford and they have been unable to prove that the properties I was revering to (The Sticky Wicket, Pavilion Restaurant, Stanford Boathouse and the Athletics Club) came from SIB. They say they do not have the money trail to be able to prove in court that Victims money was used for the purchase of these properties. It would appear that Janvey has the proof they need and he will not give the info to them. Anyway, I have pasted a copy of her email below.
I also asked about the properties on the island and why Andrea Stolker (Stanford Fiancee') was being allowed to open properties that clearly were paid for with SIB money and she said the Stolker has power of Attorney from Stanford and they have been unable to prove that the properties I was revering to (The Sticky Wicket, Pavilion Restaurant, Stanford Boathouse and the Athletics Club) came from SIB. They say they do not have the money trail to be able to prove in court that Victims money was used for the purchase of these properties. It would appear that Janvey has the proof they need and he will not give the info to them. Anyway, I have pasted a copy of her email below.
Dear Wendyanne,
Further to our recent discussion I can confirm that we can only provide you details of properties owned by SIB, we do not know 100% who owns the other properties are we are not appointed over the other companies. However from what enquiries we have undertaken we believe that the Stanford properties not owned by SIB are owned by Stanford Development Company Ltd (“SDC”).
We currently cannot go to court in Antigua as we do not have the records to support a claim that SIB ultimately funded the purchase of the properties not owned by SIB. I note your point regarding the Van Tassel report however this would not be sufficient evidence on its own to support a claim through the Antiguan courts.
Once a co operation agreement with the U.S Receiver is ratified by both courts we can ask for further information on funds flow to pursue other property on the Island.
This agreement cannot be ratified by the courts until the removal application has been dealt with.
The properties owned by SIB which we are seeking potential purchasers are as follow:
The Building occupied by ECAB at Coolidge
Pelican Island
Guaina Island and surrounding land
Two small plots of land at Coolidge
Athletic Club
I hope this offers you some clarity in respect of the current position.
Kind regards
Sarah
For and on behalf of the Joint Liquidators
Monday, 14 June 2010
Vantis warns it may have to stop trading
Accountancy group Vantis may itself face corporate restructuring or insolvency after its board flagged up uncertainty that the firm can continue trading, leading its shares to be suspended from the junior market.
Trouble at the firm, which specialises in corporate restructuring and insolvency, hinges on a massive unpaid fees bill from its work on Stanford International Bank, as well as the impact of the recession on its business advisory and tax arm.
Chief executive Paul Jackson and head of corporate restructuring Nigel Hamilton-Smith, who worked on Vantis's most high-profile case, the liquidation of alleged Ponzi schemer Allen Stanford's Antiguan bank, resigned from the firm's board on Saturday. They are still working for the firm on day-to-day business, Vantis said.
Vantis has yet to receive a penny of the multi-million-pound fees it is owed for its liquidation work on Stanford International Bank.
It was hit with further bad news last week when a high court judge in Antigua ordered the firm to be removed from its position as liquidator on the Stanford case after complaints from a creditor.
Vantis's finance director, Steve Smith, is taking over “all executive responsibilities” at the firm until a new chief executive is identified, the firm said.
It added that it was still in discussions about selling “certain of the company's assets” and talking to potential investors as well as its lenders, who include Lloyds TSB, Barclays and Royal Bank of Scotland, about a rescue package
Trouble at the firm, which specialises in corporate restructuring and insolvency, hinges on a massive unpaid fees bill from its work on Stanford International Bank, as well as the impact of the recession on its business advisory and tax arm.
Chief executive Paul Jackson and head of corporate restructuring Nigel Hamilton-Smith, who worked on Vantis's most high-profile case, the liquidation of alleged Ponzi schemer Allen Stanford's Antiguan bank, resigned from the firm's board on Saturday. They are still working for the firm on day-to-day business, Vantis said.
Vantis has yet to receive a penny of the multi-million-pound fees it is owed for its liquidation work on Stanford International Bank.
It was hit with further bad news last week when a high court judge in Antigua ordered the firm to be removed from its position as liquidator on the Stanford case after complaints from a creditor.
Vantis's finance director, Steve Smith, is taking over “all executive responsibilities” at the firm until a new chief executive is identified, the firm said.
It added that it was still in discussions about selling “certain of the company's assets” and talking to potential investors as well as its lenders, who include Lloyds TSB, Barclays and Royal Bank of Scotland, about a rescue package
Thursday, 10 June 2010
Vantis to Appeal Antigua High Court Decision
The Joint Liquidators of SIB, Mr Nigel Hamilton-Smith and Mr Peter Wastell, were appointed by the Financial Services Regulatory Commission of Antigua and Barbuda as Joint Receivers, and subsequently Joint Liquidators, of SIB on 19 February 2009.
Following a decision by the High Court of Antigua on Tuesday 8 June 2010, the Joint Liquidators wish to confirm that the Court has decided that they should be removed from office and alternative liquidators appointed. As at the date of this release, a written judgment has not been handed down by the Antiguan Court.
The Joint Liquidators have been advised by their legal counsel that the basis of the decision, which has as yet only been given orally by the Judge, was incorrect and that it should be urgently appealed to the Eastern Caribbean Court of Appeal.
Since their appointment, the Joint Liquidators have continued to make significant progress in their efforts to recover monies on behalf of the creditors and investors of SIB and, as recently as 7 June 2010, were recognised by the Swiss Financial Regulator as the officers to whom control of the SIB assets in Switzerland, totalling in excess of US$100 million, should pass.
Following extensive negotiations, the Government of Antigua & Barbuda had also recently confirmed that the properties owned by SIB, which the Government had made moves to compulsorily purchase, would be released to the Joint Liquidators, as part of their ongoing efforts to obtain the maximum return for creditors.
In addition, a settlement agreement between the Joint Liquidators and the United States Receiver was reached in late May 2010, which sought to bring to a conclusion the legal challenges that have taken place between them in relation to the assets of SIB that are located in Antigua, the United States, the United Kingdom and Canada.
The Joint Liquidators wish to confirm that they will request a stay in the High Court decision pending their appeal to the Eastern Caribbean Court of Appeal to enable them to remain in office. The Joint Liquidators remain focused on recovering the assets of SIB for creditors. 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.vantisplc.com/, where their claims will continue to be processed.
Following a decision by the High Court of Antigua on Tuesday 8 June 2010, the Joint Liquidators wish to confirm that the Court has decided that they should be removed from office and alternative liquidators appointed. As at the date of this release, a written judgment has not been handed down by the Antiguan Court.
The Joint Liquidators have been advised by their legal counsel that the basis of the decision, which has as yet only been given orally by the Judge, was incorrect and that it should be urgently appealed to the Eastern Caribbean Court of Appeal.
Since their appointment, the Joint Liquidators have continued to make significant progress in their efforts to recover monies on behalf of the creditors and investors of SIB and, as recently as 7 June 2010, were recognised by the Swiss Financial Regulator as the officers to whom control of the SIB assets in Switzerland, totalling in excess of US$100 million, should pass.
Following extensive negotiations, the Government of Antigua & Barbuda had also recently confirmed that the properties owned by SIB, which the Government had made moves to compulsorily purchase, would be released to the Joint Liquidators, as part of their ongoing efforts to obtain the maximum return for creditors.
In addition, a settlement agreement between the Joint Liquidators and the United States Receiver was reached in late May 2010, which sought to bring to a conclusion the legal challenges that have taken place between them in relation to the assets of SIB that are located in Antigua, the United States, the United Kingdom and Canada.
The Joint Liquidators wish to confirm that they will request a stay in the High Court decision pending their appeal to the Eastern Caribbean Court of Appeal to enable them to remain in office. The Joint Liquidators remain focused on recovering the assets of SIB for creditors. 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.vantisplc.com/, where their claims will continue to be processed.
Wednesday, 9 June 2010
Stanford Receivers Fired
Vantis Business Recovery Services, which was appointed to liquidate R Allen Stanford-owned lands released by the government, was relieved of its duties by a court ruling on Tuesday.
Caribarena.com received reliable information that the company, along with joint liquidators Nigel Hamilton-Smith and Peter Wastell, are no longer to preside over the sale of Stanford lands.
Attorney General Justin Simon confirmed this on Tuesday night, when Caribarena.com received the information.
Simon said he had not seen the judgment, but it is his understanding that the claimant is to provide three names to the court for a determination on who is the best replacement.
Caribarena.com received reliable information that the company, along with joint liquidators Nigel Hamilton-Smith and Peter Wastell, are no longer to preside over the sale of Stanford lands.
Attorney General Justin Simon confirmed this on Tuesday night, when Caribarena.com received the information.
Simon said he had not seen the judgment, but it is his understanding that the claimant is to provide three names to the court for a determination on who is the best replacement.
Friday, 28 May 2010
Vantis Breakdown of SIB's Clients by Country
These are the Antigua receivers own findings on where the SIB clients who invested in Stanford came from.
Tuesday, 13 April 2010
Vantis hit by $6bn 'hole' in Allen Stanford assets
The thousands who invested $7 billion (£4.5 billion) in Allen Stanford's alleged Ponzi scheme are unlikely to get more than 10% of their money back.
The receiver investigating Stanford International Bank today warned he had discovered a $6 billion (£3.9 billion) "hole".
Stanford, who arrived at Lord's cricket ground in 2008 to sign up the England team for a $1 million tournament in the West Indies, lured more than 27,000 investors into his scheme.
But Nigel Hamilton Smith, head of corporate restructuring at the listed accountancy firm Vantis, said Standford “siphoned away” $6 billion.
The receiver, who was appointed by the Antiguan government, told Insolvency News: “There is meant to be funds from deposits worth £7.3 billion.
"However, the only assets existing are worth $500 million to $700 million, creating this $6 billion hole. All the money invested was siphoned away and spent on creating this huge financial empire. While it would be naïve to think Stanford didn't stash away something, it certainly wasn't billions.”
The news led to shares in Vantis falling 3% to 22.8p. The firm recently told shareholders that it had not collected any fees for the advisory work carried out on the liquidation of Stanford International Bank, because the assets had been frozen.
Its auditors Ernst & Young warned that “material uncertainties associated with receipts from the Stanford insolvency ... may cast significant doubt on the company's ability to continue as a going concern”.
The receiver investigating Stanford International Bank today warned he had discovered a $6 billion (£3.9 billion) "hole".
Stanford, who arrived at Lord's cricket ground in 2008 to sign up the England team for a $1 million tournament in the West Indies, lured more than 27,000 investors into his scheme.
But Nigel Hamilton Smith, head of corporate restructuring at the listed accountancy firm Vantis, said Standford “siphoned away” $6 billion.
The receiver, who was appointed by the Antiguan government, told Insolvency News: “There is meant to be funds from deposits worth £7.3 billion.
"However, the only assets existing are worth $500 million to $700 million, creating this $6 billion hole. All the money invested was siphoned away and spent on creating this huge financial empire. While it would be naïve to think Stanford didn't stash away something, it certainly wasn't billions.”
The news led to shares in Vantis falling 3% to 22.8p. The firm recently told shareholders that it had not collected any fees for the advisory work carried out on the liquidation of Stanford International Bank, because the assets had been frozen.
Its auditors Ernst & Young warned that “material uncertainties associated with receipts from the Stanford insolvency ... may cast significant doubt on the company's ability to continue as a going concern”.
Tuesday, 2 March 2010
Stanford Victims Want Receiver in Antigua Ousted
Investor Alex Fundora feels like he's been forgotten as court-appointed receivers fight over the scraps of R. Allen's Stanford's fallen $7 billion financial empire.
The Miami man lost $2.7 million on certificates of deposit -- money he thought was safe -- when government regulators in Antigua and Dallas took over Stanford's operations, accusing him of running a Ponzi scheme.
Fundora filed an amended affidavit Feb. 17 asking the Eastern Caribbean Supreme Court of Antigua and Barbuda to remove an accounting company liquidating Stanford International Bank, saying London-based Vantis is in over its head and in jeopardy of going bankrupt itself.
But Fundora doesn't stop there. He finds fault with the U.S. receiver, Dallas attorney Ralph Janvey of Krage & Janvey, who is generating $1.1 million in fees a month. Janvey plans to sue Stanford depositors who lost money, and a federal class action case in Miami alleges the U.S. receiver has ignored depositors who created trust funds.
"My biggest problem is I'm a victim," Fundora said in an interview. "Everyone who was a depositor was a victim, and we are being re-vicitimized. It seems like everyone is having a feast at our expense."
His affidavit filed in the Antigua bankruptcy case sums up the growing discontent with Vantis and Janvey among Stanford's alleged victims. Fundora urges the Antigua court to replace Vantis' Nigel Hamilton-Smith and Peter Wastell as bankruptcy liquidators with Marcus A. Wide of PriceWaterhouse Canada.
Wide has done 35 Caribbean bank liquidations, said Fundora's attorney, Ed Davis of Astigarraga Davis in Miami. Wide "is a master of the Caribbean. They (Hamilton-Smith and Wastell) are complete neophytes, and they have proven it over and over again in this liquidation."
Fundora is the face leading about 100 investors who claim a total of $70 million in losses in Antigua-based Stanford International Bank and want Vantis to be removed. The thrust of their argument is the accounting firm Ernst & Young has issued a "going-concern warning" regarding Vantis' continued financial viability.
Davis blames Vantis' financial difficulties on its decision to pay $11 million to contractors who worked on the bankruptcy rather than wait for court approval of a fee application.
"Another mistake," he said.
Elsewhere, a Quebec Superior Court judge said Vantis' application to be named foreign receiver for Canadian investors was riddled with untruths and misrepresentations. As a result, the court named Janvey the official representative for Stanford's Canadian customers, finding that Vantis destroyed computer servers with information about Stanford Canadian accounts.
Superior Court Justice Claude Auclair said he was removing Vantis as representative "because of the absence of good faith and of respect towards the Canadian public interest, represented by the court and the regulatory authorities."
But back on its home turf in London, Vantis got the upper hand on Janvey in a court ruling Thursday from the British Court of Appeal, which ruled the Antigua liquidators are the recognized foreign representatives of Stanford International Bank.
"This is a big, big blow to Janvey," Davis said. "Janvey lost hands down."
Janvey's Web site for victims of Stanford's alleged fraud said he disagrees with the decision as well as its finding that Stanford International Bank's "center of main interest" is in the Caribbean country and not the United States.
"The court's conclusion is wrong because the U.S. receivership clearly is an insolvency proceeding," Janvey said on the Web site. Stanford International Bank "is dramatically insolvent. It is being liquidated for the benefit of creditors."
What is worrisome to creditors is that a faltering Vantis may negotiate with Janvey and "give away rights that would be beneficial to the victims in order to keep its position," Davis said.
Jeffrey Schneider, a partner with Levine Kellogg Lehman Schneider & Grossman in Miami, said it's not unusual for receiverships in different jurisdictions to fight for turf.
"Turf wars accomplish nothing other than exponentially increasing the fees of the professionals," said Schneider, who has frequently served as a receiver. "Victims' recovery certainly aren't enhanced under those circumstances."
Fundora sees all this posturing by receivers as draining Stanford's assets. He said Vantis and Janvey's "burn rate" is insulting to victims of the alleged fraud.
Janvey angered Stanford victims last summer when he requested $20 million in fees. Earlier this month, the U.S. Bankruptcy Court in Dallas approved another $8.8 million in fees for Janvey, and he estimated he is spending about $1.1 million each month in search of remaining assets.
In a highly unusual move, the Securities and Exchange Commission, which recommended Janvey for the job, opposed his initial fee request.
"Having the SEC object to the receiver's fees is very uncommon," Schneider said. "Janvey should be sharing his fee applications with the SEC before his is filing them."
Janvey, who did not return phone calls for comment, has taken plenty of heat from Stanford clients. Here's just one item from a bulletin board on the Web site Frauds and Victims: "Janvey will go down in history as the worst receiver ever appointed by the SEC and in American Ponzi history. Most of the receivers get back between 40 percent and 85 percent. He could not even get 1 percent, but he charged 33 percent over his miserable findings."
The post is signed "Was a calm cool investor."
Luis Delgado, a partner with Homer Bonner in Miami, represents plaintiffs in a class action suit filed in Miami federal court on behalf of Stanford trust depositors who claim they lost more than $200 million. He said Janvey has blatantly ignored his frustrated clients.
"They don't understand why Janvey and Vantis aren't working together and why we have two parties generating fees," he said.
Delgado contends Janvey is going after lost causes by suing net losers, former Stanford customers who may have earned some interest but ended up losing money when the bank went belly-up. The SEC has asked him to drop such lawsuits.
"I don't understand this receiver going after a lot of the same people he is supposed to be protecting," Delgado said. "I think it's a waste of time and waste of the estates' assets."
An examiner appointed in the SEC case to advocate for Stanford investors said Janvey has not explained adequately why he needs to use so many professionals. Intervenor examiner John Little, a partner with Little Pedersen Fankhauser in Dallas, said Janvey's fee requests suggest "the substantial possibility that the whole of the receiver estate could end up, not in the hands of the victimized investors, but in the pockets of the receiver and the firms he has retained," according to a court filing in August.
But it's noteworthy that both Little and the SEC signed off on Janvey's latest $8.8 million fee request. Either way, the turf war is far from over. The Dallas bankruptcy judge has yet to decide who is the top receiver in Stanford. People who claim they lost money to Stanford can't even ask to remove Janvey because he serves at the behest of the SEC.
"They basically ate the roast and left the drippings," Davis said. "This case is a poster child on how you shouldn't do a multi-jurisdictional international asset recovery."
The Miami man lost $2.7 million on certificates of deposit -- money he thought was safe -- when government regulators in Antigua and Dallas took over Stanford's operations, accusing him of running a Ponzi scheme.
Fundora filed an amended affidavit Feb. 17 asking the Eastern Caribbean Supreme Court of Antigua and Barbuda to remove an accounting company liquidating Stanford International Bank, saying London-based Vantis is in over its head and in jeopardy of going bankrupt itself.
But Fundora doesn't stop there. He finds fault with the U.S. receiver, Dallas attorney Ralph Janvey of Krage & Janvey, who is generating $1.1 million in fees a month. Janvey plans to sue Stanford depositors who lost money, and a federal class action case in Miami alleges the U.S. receiver has ignored depositors who created trust funds.
"My biggest problem is I'm a victim," Fundora said in an interview. "Everyone who was a depositor was a victim, and we are being re-vicitimized. It seems like everyone is having a feast at our expense."
His affidavit filed in the Antigua bankruptcy case sums up the growing discontent with Vantis and Janvey among Stanford's alleged victims. Fundora urges the Antigua court to replace Vantis' Nigel Hamilton-Smith and Peter Wastell as bankruptcy liquidators with Marcus A. Wide of PriceWaterhouse Canada.
Wide has done 35 Caribbean bank liquidations, said Fundora's attorney, Ed Davis of Astigarraga Davis in Miami. Wide "is a master of the Caribbean. They (Hamilton-Smith and Wastell) are complete neophytes, and they have proven it over and over again in this liquidation."
Fundora is the face leading about 100 investors who claim a total of $70 million in losses in Antigua-based Stanford International Bank and want Vantis to be removed. The thrust of their argument is the accounting firm Ernst & Young has issued a "going-concern warning" regarding Vantis' continued financial viability.
Davis blames Vantis' financial difficulties on its decision to pay $11 million to contractors who worked on the bankruptcy rather than wait for court approval of a fee application.
"Another mistake," he said.
Elsewhere, a Quebec Superior Court judge said Vantis' application to be named foreign receiver for Canadian investors was riddled with untruths and misrepresentations. As a result, the court named Janvey the official representative for Stanford's Canadian customers, finding that Vantis destroyed computer servers with information about Stanford Canadian accounts.
Superior Court Justice Claude Auclair said he was removing Vantis as representative "because of the absence of good faith and of respect towards the Canadian public interest, represented by the court and the regulatory authorities."
But back on its home turf in London, Vantis got the upper hand on Janvey in a court ruling Thursday from the British Court of Appeal, which ruled the Antigua liquidators are the recognized foreign representatives of Stanford International Bank.
"This is a big, big blow to Janvey," Davis said. "Janvey lost hands down."
Janvey's Web site for victims of Stanford's alleged fraud said he disagrees with the decision as well as its finding that Stanford International Bank's "center of main interest" is in the Caribbean country and not the United States.
"The court's conclusion is wrong because the U.S. receivership clearly is an insolvency proceeding," Janvey said on the Web site. Stanford International Bank "is dramatically insolvent. It is being liquidated for the benefit of creditors."
What is worrisome to creditors is that a faltering Vantis may negotiate with Janvey and "give away rights that would be beneficial to the victims in order to keep its position," Davis said.
Jeffrey Schneider, a partner with Levine Kellogg Lehman Schneider & Grossman in Miami, said it's not unusual for receiverships in different jurisdictions to fight for turf.
"Turf wars accomplish nothing other than exponentially increasing the fees of the professionals," said Schneider, who has frequently served as a receiver. "Victims' recovery certainly aren't enhanced under those circumstances."
Fundora sees all this posturing by receivers as draining Stanford's assets. He said Vantis and Janvey's "burn rate" is insulting to victims of the alleged fraud.
Janvey angered Stanford victims last summer when he requested $20 million in fees. Earlier this month, the U.S. Bankruptcy Court in Dallas approved another $8.8 million in fees for Janvey, and he estimated he is spending about $1.1 million each month in search of remaining assets.
In a highly unusual move, the Securities and Exchange Commission, which recommended Janvey for the job, opposed his initial fee request.
"Having the SEC object to the receiver's fees is very uncommon," Schneider said. "Janvey should be sharing his fee applications with the SEC before his is filing them."
Janvey, who did not return phone calls for comment, has taken plenty of heat from Stanford clients. Here's just one item from a bulletin board on the Web site Frauds and Victims: "Janvey will go down in history as the worst receiver ever appointed by the SEC and in American Ponzi history. Most of the receivers get back between 40 percent and 85 percent. He could not even get 1 percent, but he charged 33 percent over his miserable findings."
The post is signed "Was a calm cool investor."
Luis Delgado, a partner with Homer Bonner in Miami, represents plaintiffs in a class action suit filed in Miami federal court on behalf of Stanford trust depositors who claim they lost more than $200 million. He said Janvey has blatantly ignored his frustrated clients.
"They don't understand why Janvey and Vantis aren't working together and why we have two parties generating fees," he said.
Delgado contends Janvey is going after lost causes by suing net losers, former Stanford customers who may have earned some interest but ended up losing money when the bank went belly-up. The SEC has asked him to drop such lawsuits.
"I don't understand this receiver going after a lot of the same people he is supposed to be protecting," Delgado said. "I think it's a waste of time and waste of the estates' assets."
An examiner appointed in the SEC case to advocate for Stanford investors said Janvey has not explained adequately why he needs to use so many professionals. Intervenor examiner John Little, a partner with Little Pedersen Fankhauser in Dallas, said Janvey's fee requests suggest "the substantial possibility that the whole of the receiver estate could end up, not in the hands of the victimized investors, but in the pockets of the receiver and the firms he has retained," according to a court filing in August.
But it's noteworthy that both Little and the SEC signed off on Janvey's latest $8.8 million fee request. Either way, the turf war is far from over. The Dallas bankruptcy judge has yet to decide who is the top receiver in Stanford. People who claim they lost money to Stanford can't even ask to remove Janvey because he serves at the behest of the SEC.
"They basically ate the roast and left the drippings," Davis said. "This case is a poster child on how you shouldn't do a multi-jurisdictional international asset recovery."
Monday, 8 February 2010
TODAY... from VANTIS, Antigua
The Joint Liquidators of Stanford International Bank Ltd – in Liquidation (SIB), Nigel Hamilton-Smith and Peter Wastell of Vantis Business Recovery Services, wish to provide an update regarding the location and status of known SIB assets and their recovery. The international pursuit of SIB assets for creditors continues to be the central feature of the recovery process and, in the interests of transparency and a commitment to regular communication with affected stakeholders, further communications will be issued as and when developments take place.
To date, circa US$100 million has been located in the United Kingdom (UK). In order to gain control of these assets, the Joint Liquidators sought formal recognition of their appointment. On 3 July 2009, the High Court of Justice of England and Wales issued a judgment in favour of the Joint Liquidators, confirming that the Centre of Main Interest of SIB is Antigua and Barbuda. An appeal against this decision by the US Receiver, Mr Ralph Janvey, was heard by the High Court between 16 and 20 November 2009. The hearing also dealt with an appeal from the UK Serious Fraud office on behalf of the United States of America (US) Department of Justice (DOJ) which has sought to restrain the same funds for forfeiture to the DOJ as proceeds of crime. The outcome is awaited and further notification will be issued when the judgment is handed down.
In the US, several proactive and meaningful discussions have been held with the US Receiver and his advisers, and the Joint Liquidators are hopeful that a working co-operation agreement can be established. As such, an agreement will be subject to regulatory and judicial approval in both jurisdictions. A conclusion is unlikely before March 2010, but a successful cooperation of this kind will lead to a significant reduction in costs for the SIB creditors.
In Antigua, at the commencement of winding-up, an application by a creditor was made for an alternate office holder. This was unsuccessful in the Antiguan courts. A further application by the same creditor has again been made and this matter will be before the courts in the near future. It is not believed that this application holds any merit, nor any legal basis. However, this further piece of litigation will need to be settled by the Antiguan judiciary.
In the meantime, the Joint Liquidators have been successful in tracing substantial investments into offshore companies which have revealed significant land assets in Antigua, valued in excess of US$150 million. Additional land holdings, registered in other Caribbean companies originally controlled by Mr Allen Stanford, are currently being investigated. It is expected that realizations from these sources will become available to creditors.
Significant lines of inquiry are also being pursued regarding claims against Mr Stanford. The Joint Liquidators anticipate this will result in a further realization of assets.
The Joint Liquidators have made an application under the Bankruptcy & Insolvency Act in Canada for recognition of its appointment and control of the funds held in the country. These number approximately US$20 million. At the same time, Mr Janvey made the same application. During August 2009, the Superior Court of Quebec held a hearing, following which it concluded that Mr Janvey should be recognized and control of the funds should be passed to him.
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 decision. The Joint Liquidators retain the right to take this matter to the Supreme Court of Canada and the matter is currently with their legal advisers.
In Switzerland, applications have been made to the Swiss Financial Regulator, FINMA, for recognition and control of the assets based in the country, valued in excess of US$100 million. In addition to the Joint Liquidators’ application, Mr Janvey and the DOJ have made a similar application for control of the funds. The matter is currently with the Swiss Financial Services Regulator and the decision is pending.
Both Nigel Hamilton-Smith and Peter Wastell are keen to ensure that the interests of the creditors remain paramount throughout all these proceedings.
The Vantis Online Claims Management System is proving to be instrumental in assisting with the agreement of several thousand SIB creditors’ claims. Any creditor who has not yet registered their claim, is urged to do so at http://stanford.vantisplc.com/ to ensure any early agreement of claims.
Further communications will be issued when practicable.
For information relating to SIB, creditors are invited to visit www.vantisplc.com/Stanford or email stanfordenquiries@vantisplc.com.
To date, circa US$100 million has been located in the United Kingdom (UK). In order to gain control of these assets, the Joint Liquidators sought formal recognition of their appointment. On 3 July 2009, the High Court of Justice of England and Wales issued a judgment in favour of the Joint Liquidators, confirming that the Centre of Main Interest of SIB is Antigua and Barbuda. An appeal against this decision by the US Receiver, Mr Ralph Janvey, was heard by the High Court between 16 and 20 November 2009. The hearing also dealt with an appeal from the UK Serious Fraud office on behalf of the United States of America (US) Department of Justice (DOJ) which has sought to restrain the same funds for forfeiture to the DOJ as proceeds of crime. The outcome is awaited and further notification will be issued when the judgment is handed down.
In the US, several proactive and meaningful discussions have been held with the US Receiver and his advisers, and the Joint Liquidators are hopeful that a working co-operation agreement can be established. As such, an agreement will be subject to regulatory and judicial approval in both jurisdictions. A conclusion is unlikely before March 2010, but a successful cooperation of this kind will lead to a significant reduction in costs for the SIB creditors.
In Antigua, at the commencement of winding-up, an application by a creditor was made for an alternate office holder. This was unsuccessful in the Antiguan courts. A further application by the same creditor has again been made and this matter will be before the courts in the near future. It is not believed that this application holds any merit, nor any legal basis. However, this further piece of litigation will need to be settled by the Antiguan judiciary.
In the meantime, the Joint Liquidators have been successful in tracing substantial investments into offshore companies which have revealed significant land assets in Antigua, valued in excess of US$150 million. Additional land holdings, registered in other Caribbean companies originally controlled by Mr Allen Stanford, are currently being investigated. It is expected that realizations from these sources will become available to creditors.
Significant lines of inquiry are also being pursued regarding claims against Mr Stanford. The Joint Liquidators anticipate this will result in a further realization of assets.
The Joint Liquidators have made an application under the Bankruptcy & Insolvency Act in Canada for recognition of its appointment and control of the funds held in the country. These number approximately US$20 million. At the same time, Mr Janvey made the same application. During August 2009, the Superior Court of Quebec held a hearing, following which it concluded that Mr Janvey should be recognized and control of the funds should be passed to him.
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 decision. The Joint Liquidators retain the right to take this matter to the Supreme Court of Canada and the matter is currently with their legal advisers.
In Switzerland, applications have been made to the Swiss Financial Regulator, FINMA, for recognition and control of the assets based in the country, valued in excess of US$100 million. In addition to the Joint Liquidators’ application, Mr Janvey and the DOJ have made a similar application for control of the funds. The matter is currently with the Swiss Financial Services Regulator and the decision is pending.
Both Nigel Hamilton-Smith and Peter Wastell are keen to ensure that the interests of the creditors remain paramount throughout all these proceedings.
The Vantis Online Claims Management System is proving to be instrumental in assisting with the agreement of several thousand SIB creditors’ claims. Any creditor who has not yet registered their claim, is urged to do so at http://stanford.vantisplc.com/ to ensure any early agreement of claims.
Further communications will be issued when practicable.
For information relating to SIB, creditors are invited to visit www.vantisplc.com/Stanford or email stanfordenquiries@vantisplc.com.
Tuesday, 2 February 2010
Vantis Suffering Major Cashflow Problems
Vantis is reported to be suffering major cashflow problems because liquidators stand their own costs unless and until funds are available to pay them.
In the case of SIB, there are substantial funds - Vantis say that they have identified more than USD100 million in the UK. But the assets are frozen after the UK's Serious Fraud Office, with support from the US Department of Justice obtained an order to secure the funds. Vantis applied for an order in England that the assets should be controlled from Antigua and Barbuda and that that jurisdiction is the "Centre of Main Interest" and that they, therefore, fall within the scope of Vantis' instructions. But the receiver in the USA appealed.
The Court has not yet ruled, perhaps having in mind the case of European Bank in the Cayman Islands where regulators appointed liquidators who wound up the bank whilst criminal proceedings were proceeding; the criminal proceedings were thrown out but by then the bank was dead. The liquidation paid all creditors in full together with substantial liquidation costs leaving shareholders without a bank and out of pocket.
The only reason that SIB is in the hands of liquidators is because the US authorities accused Allen Stanford of fraud; he has not been tried.
SIB assets in Switzerland are also frozen and the liquidators have also applied for those to be released, again with no favourable response.
The reports as to Vantis' financial state were reported The Times today citing a note in Vantis' accountants' report. The new (Non-Executive) Chairman of Vantis, since mid December, has been Mike Wheeler, formerly Global Managing Partner of Advisory Services at KPMG. There have been a number of board changes. KPMG are the auditors for Vantis.
They have qualified the accounts with a startlingly clear statement: there are "material uncertainties associated with receipts from the Stanford insolvency. [The Stanford uncertainties] may cast significant doubt on the company’s ability to continue as a going concern” Vantis restructured its borrowings last year, rescheduled a bond payment and arranged a modification of its banking covenants to something "more appropriate." But KPMG are not convinced that this will work: “the validity of the going concern basis depends on the group being able to operate within its current banking facilities and covenants which requires the successful outcome of the above”.
In short, while the assets remain frozen and not available to the liquidators to pay themselves, the liquidators face collapse.
In the UK, liquidators are subject to remarkably little supervision with regard to their activities and fees and those estates that do have funds are often subjected to very substantial charges in order to make up for the cases where there is a loss as the insolvency practitioners view their practice as a whole rather than in individual cases. There is fierce competition amongst firms to secure cases where there are assets against which charges may be raised
In the case of SIB, there are substantial funds - Vantis say that they have identified more than USD100 million in the UK. But the assets are frozen after the UK's Serious Fraud Office, with support from the US Department of Justice obtained an order to secure the funds. Vantis applied for an order in England that the assets should be controlled from Antigua and Barbuda and that that jurisdiction is the "Centre of Main Interest" and that they, therefore, fall within the scope of Vantis' instructions. But the receiver in the USA appealed.
The Court has not yet ruled, perhaps having in mind the case of European Bank in the Cayman Islands where regulators appointed liquidators who wound up the bank whilst criminal proceedings were proceeding; the criminal proceedings were thrown out but by then the bank was dead. The liquidation paid all creditors in full together with substantial liquidation costs leaving shareholders without a bank and out of pocket.
The only reason that SIB is in the hands of liquidators is because the US authorities accused Allen Stanford of fraud; he has not been tried.
SIB assets in Switzerland are also frozen and the liquidators have also applied for those to be released, again with no favourable response.
The reports as to Vantis' financial state were reported The Times today citing a note in Vantis' accountants' report. The new (Non-Executive) Chairman of Vantis, since mid December, has been Mike Wheeler, formerly Global Managing Partner of Advisory Services at KPMG. There have been a number of board changes. KPMG are the auditors for Vantis.
They have qualified the accounts with a startlingly clear statement: there are "material uncertainties associated with receipts from the Stanford insolvency. [The Stanford uncertainties] may cast significant doubt on the company’s ability to continue as a going concern” Vantis restructured its borrowings last year, rescheduled a bond payment and arranged a modification of its banking covenants to something "more appropriate." But KPMG are not convinced that this will work: “the validity of the going concern basis depends on the group being able to operate within its current banking facilities and covenants which requires the successful outcome of the above”.
In short, while the assets remain frozen and not available to the liquidators to pay themselves, the liquidators face collapse.
In the UK, liquidators are subject to remarkably little supervision with regard to their activities and fees and those estates that do have funds are often subjected to very substantial charges in order to make up for the cases where there is a loss as the insolvency practitioners view their practice as a whole rather than in individual cases. There is fierce competition amongst firms to secure cases where there are assets against which charges may be raised
Monday, 1 February 2010
Stanford causes Vantis going concern threat
Source - Accountancy Age.
Cashflow concerns from Vantis' work as liquidators of Stanford International Bank sees the firm's auditors issue warning
Cashflow problems from acting as joint-liquidator for Allen Stanford's bank has put the future of Vantis under threat.
The firm's interim results, out this morning, reveal auditors Ernst & Young has issued an emphasis of matter - going concern statement, warning that uncertainties from receiving funds from its work at Stanford, plus cash flow and cost reduction initiatives, put doubt on its ability to continue as a going concern.
Vantis said that it had put "significant resource" to its work recovering assets from Stanford International Bank. A freezing order on assets in the US, plus a delay in the realisation of property assets meant that Vantis was unable to receive fees for its work during the half year period ending 31 October 2009.
"The validity of the going concern basis depends on the group being able to operate within its current banking facilities and covenants which requires the successful outcome of the above," the auditors added in the statement.
Vantis said: "The group is confident that outstanding time costs will be recovered in due course but the various legal actions mean that timing is uncertain."
Emphasis of matter paragraphs are used by auditors to flag up material uncertainties affecting a business.
The group's turnover for the period before exceptional items fell by 2% to £47m, compared to a year earlier.
After exceptional costs relating to restructuring its balance sheet, Vantis posted a £10.7m loss compared to a £4.6m profit 12 months ago.
Vantis' share price on AIM reached 91p last May, but closed on Friday at 29p. It is trading at 30p at the time of publishing.
The group has started a cost reduction programme to improve its future performance, said chairman Mike Wheeler.
"We expect further growth in business recovery services but the performance of business advisory and tax division will be constrained until the UK economy improves," said Wheeler in the statement.
Cashflow concerns from Vantis' work as liquidators of Stanford International Bank sees the firm's auditors issue warning
Cashflow problems from acting as joint-liquidator for Allen Stanford's bank has put the future of Vantis under threat.
The firm's interim results, out this morning, reveal auditors Ernst & Young has issued an emphasis of matter - going concern statement, warning that uncertainties from receiving funds from its work at Stanford, plus cash flow and cost reduction initiatives, put doubt on its ability to continue as a going concern.
Vantis said that it had put "significant resource" to its work recovering assets from Stanford International Bank. A freezing order on assets in the US, plus a delay in the realisation of property assets meant that Vantis was unable to receive fees for its work during the half year period ending 31 October 2009.
"The validity of the going concern basis depends on the group being able to operate within its current banking facilities and covenants which requires the successful outcome of the above," the auditors added in the statement.
Vantis said: "The group is confident that outstanding time costs will be recovered in due course but the various legal actions mean that timing is uncertain."
Emphasis of matter paragraphs are used by auditors to flag up material uncertainties affecting a business.
The group's turnover for the period before exceptional items fell by 2% to £47m, compared to a year earlier.
After exceptional costs relating to restructuring its balance sheet, Vantis posted a £10.7m loss compared to a £4.6m profit 12 months ago.
Vantis' share price on AIM reached 91p last May, but closed on Friday at 29p. It is trading at 30p at the time of publishing.
The group has started a cost reduction programme to improve its future performance, said chairman Mike Wheeler.
"We expect further growth in business recovery services but the performance of business advisory and tax division will be constrained until the UK economy improves," said Wheeler in the statement.
Saturday, 21 November 2009
Stanford investors to Antigua: Remove liquidator
ST. JOHN'S, Antigua -- A group of investors is urging an Antiguan court to remove a British accounting firm appointed to collect assets of a Caribbean offshore bank at the center of an alleged Ponzi scheme by Texas financier R. Allen Stanford.
Martin Kenney, a lawyer for the group led by Florida businessman Alexander Fundora, said his clients have asked the High Court of Antigua to remove Vantis Business Recovery Services as liquidator because a Canadian court found earlier this year that it had deleted data from computers in the Montreal branch of Stanford International Bank Ltd.
"In order to recover and apportion the bank's assets in the fairest and most efficient way possible for the victims of this apparent grand fraud, it is crucial to have Vantis removed and replaced as soon as possible," Kenney said Friday from the British Virgin Islands.
Vantis was appointed by Antiguan authorities to liquidate the assets of Stanford International Bank. A spokeswoman for the firm did not immediately return a telephone call Saturday.
Kenney said that Vantis wiped out original data on computers in the Stanford bank's branch in Montreal, Quebec, in March, without the authority of the Canadian courts and without notifying the Quebec financial regulator.
The Superior Court in Montreal ruled in September that Vantis deliberately misled the court, destroyed original computer data, and removed financial information. Vantis operated with "questionable motives," Judge Claude Auclair wrote in the Sept. 11 judgment.
The Canadian court subsequently replaced Vantis with Ralph Janvey, a lawyer appointed by U.S. courts to liquidate Stanford assets.
Vantis and Janvey have been fighting for jurisdiction over the assets, frustrating investors who are eager to recover money they invested in what U.S. authorities have alleged as a massive Ponzi scheme.
Stanford, once a benefactor of the Antiguan government, is in a Texas jail awaiting trial on charges including money laundering and fraud.
Prosecutors accuse Stanford of leading a $7 billion Ponzi scheme by promising inflated returns to about 28,000 investors on certificates of deposits. The U.S. Securities and Exchange Commission said he instead used the money from new investors to pay off old ones. They also accuse him of skimming more than $1 billion to fund his lavish lifestyle
Martin Kenney, a lawyer for the group led by Florida businessman Alexander Fundora, said his clients have asked the High Court of Antigua to remove Vantis Business Recovery Services as liquidator because a Canadian court found earlier this year that it had deleted data from computers in the Montreal branch of Stanford International Bank Ltd.
"In order to recover and apportion the bank's assets in the fairest and most efficient way possible for the victims of this apparent grand fraud, it is crucial to have Vantis removed and replaced as soon as possible," Kenney said Friday from the British Virgin Islands.
Vantis was appointed by Antiguan authorities to liquidate the assets of Stanford International Bank. A spokeswoman for the firm did not immediately return a telephone call Saturday.
Kenney said that Vantis wiped out original data on computers in the Stanford bank's branch in Montreal, Quebec, in March, without the authority of the Canadian courts and without notifying the Quebec financial regulator.
The Superior Court in Montreal ruled in September that Vantis deliberately misled the court, destroyed original computer data, and removed financial information. Vantis operated with "questionable motives," Judge Claude Auclair wrote in the Sept. 11 judgment.
The Canadian court subsequently replaced Vantis with Ralph Janvey, a lawyer appointed by U.S. courts to liquidate Stanford assets.
Vantis and Janvey have been fighting for jurisdiction over the assets, frustrating investors who are eager to recover money they invested in what U.S. authorities have alleged as a massive Ponzi scheme.
Stanford, once a benefactor of the Antiguan government, is in a Texas jail awaiting trial on charges including money laundering and fraud.
Prosecutors accuse Stanford of leading a $7 billion Ponzi scheme by promising inflated returns to about 28,000 investors on certificates of deposits. The U.S. Securities and Exchange Commission said he instead used the money from new investors to pay off old ones. They also accuse him of skimming more than $1 billion to fund his lavish lifestyle
Thursday, 5 November 2009
Vantis Report to Stanford's Investors
2 November 2009
Dear Sir/Madam
Stanford International Bank Limited -in Liquidation (the Bank)(SIB)
This report will be emailed to those investors who have registered on the Online claims Management System. We will not be sending this report out via the postal service, as we have found the service to be unreliable in many of the countries where investors are located and this Is compounded by the costs involved. We therefore believe that email is the most effective way to communicate wi investors. For ease of reference, a copy of this report has also been posted on our website www.vantisplc.com/Stanford
Current Position with Investor Claims and Enquiries
Investors can now register their claims on the Online Claims Management System, which can be accessed via the following link: www.vantisplc.com/Stanford. Investors who have registered on the Online Claims Management System will be able to print a statement of their account, change their address details, and formally agree their claim, or notify us of any discrepancies.
For investors who do not have access to a computer, or do not wish to register online, it will remain possible for them to submit their claims In writing directly to the Joint Liquidators via the headquarters of SIB in Antigua. We shall also advertise details of how investors can register their claims in due course through national publications in the various jurisdictions where investors reside.
We continue to deal with email enquiries, responding to investor queries both in English and Spanish.
Recognition Proceedings
United Kingdom (UK)
Assets of circa US 100 million have been located in the UK. To gain control of these assets, the Joint Liquidators sought formal recognition of our appointment. On 3 July 2009, the High Court of Justice of England & ales Issued a judgment in favour of the liquidators that the Centre Of Main Interest (COMI) of SIB is Antigua and Barbuda. This judgment has been appealed to the Court Of Appeal in the UK by Ralph Janvey, the United States (US) Receiver appointed by the Securities and Exchange Commission (SEC). The appeal hearing has been set for the 17 November 2009. As such, until the appeal is concluded, the funds in question are frozen and not available to either the Joint liquidators or Mr Janvey.
Canada
The Canadian Court did not consider our application for recognition under COMI, but issued a judgment recognising the US Receiver as the party to whom the assets located in Canada (approx. US$20 million) should pass.We have taken steps to appeal the Court's decision to not hear our COMI argument. Given the existence of further proceedings involving the Attorney General in Ontario, Canada, the funds in Canada remain frozen.
Switzerland
The decision recognition Switzerland is with the Swiss authorities and we await their decision, which we anticipate receiving within the next two months. Detailed submissions have been made to the Swiss Financial Market Supervisory Authority, as to why COMI should be granted to the Joint Liquidators.
United States (US)
Proceedings have been issued under Chapter 15 of the US bankruptcy code. As SIB is not the subject of insolvency proceedings in the US, we are seeking the recognition by the US Court of the Antiguan proceedings. Unfortunately, the US Court has not yet considered our application and,at the current time, is not able to forecast a hearing date.
US Receiver's Appeal Against the Decision of the High Court of Antigua & Barbuda
On 15 April 2009, the US Receiver made an application to the Eastern Caribbean Appeal Court of Antigua & Barbuda to appeal the decision to place SIB into liquidation and this matter remains outstanding.
US Receiver Co-operation
We, together with our attorneys, have sought to reach a co-operation agreement with the US Receiver and we set out these matters in detail in our last report. To date, no indication of co-operation has been received.
Antiguan & Barbudan land Assets
The land assets of SIB are still the subject of discussion with the Government of Antigua who took a protective step to preserve these assets. The land assets have a significant value, but will inevitably take a considerable time to realise.
Dividend Prospects for Creditors
As all the COMI recognition proceedings have either not been adjudicated upon or the decision is subject to appeal and other assets, being land with an anticipated long term realisation period, we are at present unable to estimate the level and timing of a distribution to creditors.
Other Matters
We continue with our investigations into the failure of the Bank and the alleged fraudulent manner in which its executive directors acted. You may be aware that a number of the former directors of the Bank have been charged in the US with offences relating to the fraud perpetrated upon the Bank.
Dear Sir/Madam
Stanford International Bank Limited -in Liquidation (the Bank)(SIB)
This report will be emailed to those investors who have registered on the Online claims Management System. We will not be sending this report out via the postal service, as we have found the service to be unreliable in many of the countries where investors are located and this Is compounded by the costs involved. We therefore believe that email is the most effective way to communicate wi investors. For ease of reference, a copy of this report has also been posted on our website www.vantisplc.com/Stanford
Current Position with Investor Claims and Enquiries
Investors can now register their claims on the Online Claims Management System, which can be accessed via the following link: www.vantisplc.com/Stanford. Investors who have registered on the Online Claims Management System will be able to print a statement of their account, change their address details, and formally agree their claim, or notify us of any discrepancies.
For investors who do not have access to a computer, or do not wish to register online, it will remain possible for them to submit their claims In writing directly to the Joint Liquidators via the headquarters of SIB in Antigua. We shall also advertise details of how investors can register their claims in due course through national publications in the various jurisdictions where investors reside.
We continue to deal with email enquiries, responding to investor queries both in English and Spanish.
Recognition Proceedings
United Kingdom (UK)
Assets of circa US 100 million have been located in the UK. To gain control of these assets, the Joint Liquidators sought formal recognition of our appointment. On 3 July 2009, the High Court of Justice of England & ales Issued a judgment in favour of the liquidators that the Centre Of Main Interest (COMI) of SIB is Antigua and Barbuda. This judgment has been appealed to the Court Of Appeal in the UK by Ralph Janvey, the United States (US) Receiver appointed by the Securities and Exchange Commission (SEC). The appeal hearing has been set for the 17 November 2009. As such, until the appeal is concluded, the funds in question are frozen and not available to either the Joint liquidators or Mr Janvey.
Canada
The Canadian Court did not consider our application for recognition under COMI, but issued a judgment recognising the US Receiver as the party to whom the assets located in Canada (approx. US$20 million) should pass.We have taken steps to appeal the Court's decision to not hear our COMI argument. Given the existence of further proceedings involving the Attorney General in Ontario, Canada, the funds in Canada remain frozen.
Switzerland
The decision recognition Switzerland is with the Swiss authorities and we await their decision, which we anticipate receiving within the next two months. Detailed submissions have been made to the Swiss Financial Market Supervisory Authority, as to why COMI should be granted to the Joint Liquidators.
United States (US)
Proceedings have been issued under Chapter 15 of the US bankruptcy code. As SIB is not the subject of insolvency proceedings in the US, we are seeking the recognition by the US Court of the Antiguan proceedings. Unfortunately, the US Court has not yet considered our application and,at the current time, is not able to forecast a hearing date.
US Receiver's Appeal Against the Decision of the High Court of Antigua & Barbuda
On 15 April 2009, the US Receiver made an application to the Eastern Caribbean Appeal Court of Antigua & Barbuda to appeal the decision to place SIB into liquidation and this matter remains outstanding.
US Receiver Co-operation
We, together with our attorneys, have sought to reach a co-operation agreement with the US Receiver and we set out these matters in detail in our last report. To date, no indication of co-operation has been received.
Antiguan & Barbudan land Assets
The land assets of SIB are still the subject of discussion with the Government of Antigua who took a protective step to preserve these assets. The land assets have a significant value, but will inevitably take a considerable time to realise.
Dividend Prospects for Creditors
As all the COMI recognition proceedings have either not been adjudicated upon or the decision is subject to appeal and other assets, being land with an anticipated long term realisation period, we are at present unable to estimate the level and timing of a distribution to creditors.
Other Matters
We continue with our investigations into the failure of the Bank and the alleged fraudulent manner in which its executive directors acted. You may be aware that a number of the former directors of the Bank have been charged in the US with offences relating to the fraud perpetrated upon the Bank.