Meet Texas Billionaire (And Mini-Madoff?) Allen Stanford

[sonias]

Talking Points Memo 2/13/09
Meet Texas Billionaire (And Mini-Madoff?) "Sir" Allen Stanford

By Zachary Roth - February 13, 2009

We may have found our favorite mini- (or maybe not so mini-!) Madoff yet...

The FBI, SEC, and IRS are all looking into the business activities of the Stanford Financial Group, a Houston-based private investment group run by the "flamboyant Texas billionaire" Allen Stanford, reports the New York Times.

Like Madoff, Stanford's returns may have been too good to be true. A bank he owns, based in Antigua, has been issuing certificates of deposit that pay interest rates at more than twice the national average, says the paper.

Last summer, two former employees alleged in a lawsuit that the firm misled potential investors by overstating the asset value of individuals; failed to file mandatory forms disclosing its clients' offshore accounts; and removed information from its computers in response to an S.E.C. investigation.

The size of the alleged scam is unclear, but a spokesman for Stanford Financial told the Times that it "holds about $8 billion in deposits at its bank and has about $50 billion in assets in its wealth management affiliate."

Oh boy - here we go again. Thank dog that Stanford is a republican! :grr:

FundRace 2008
Full-screen
R Allen Stanford
Donation of $2,000 to Texans For Senator John Cornyn
Inc

Sonia

[sonias]

1. More news from Houston Chronicle

Houston Chronicle 2/12/09
Billionaire Stanford acknowleges regulatory probe

By BEN FOX
Associated Press Writer © 2009 The Associated Press
Feb. 12, 2009, 7:02PM

SAN JUAN, Puerto Rico — A Texas billionaire sought to reassure his employees on Thursday as U.S. regulators probed his investment firm and Caribbean bank, which have delivered higher-than-average returns to investors and depositors despite the global meltdown.

Investigators visited Florida offices of the Houston, Texas-based Stanford Group Co. in January as part of a probe that dates back at least three months, said a U.S. official with knowledge of the probe who spoke on condition of anonymity because he was not authorized to provide information about it.

The probe by the Securities and Exchange Commission, the Financial Industry Regulatory Authority — the U.S. brokerage industry's self-policing body — and the Florida Office of Financial Regulation seeks to determine if R. Allen Stanford's company violated financial regulations or laws as it prospered and delivered high returns on certificates of deposit in recent years, the official said.

:popcorn:

Sonia

[hobbit709]

2. There's no REAL difference between these guys and the Nigerian scammers

They promise you something for nothing if you give them your money. Any "investment" that offers to pay double or more than the average is either illegal, unethical or just flat out robbery. If they locked up some of the bastards in a max security jail instead of a country club, there'd be less of them doing it. They should give the same sentence to one of these clowns as they do to somebody that holds up a 7-11.

[sonias]

3. And I'll bet ya he's up to no good too

I totally agree with you. It seems like our justice system is so extreme on sentencing. The more you steal, the less time you serve. So the message seems to be - steal big! Oh and hide the money too. You saw where Madoff's wife Ruth pulled $15.5 million out of his accounts right before he got arrested.

Business Week 2/11/09
Is Stanford Financial's Offer Too Good to Be True?
Jittery

In the wake of Bernard Madoff's alleged $50 billion Ponzi scheme, regulators and investors around the world are increasingly jittery about money-management firms that promise consistently higher-than-normal returns. Stanford Financial sells clients an array of investments, from stocks and bonds to mutual funds and rare coins. Even as the firm's client list has expanded, CDs have remained a central product. Stanford International Bank, an Antigua-based affiliate that issues the CDs, had just $1 billion of assets in 2001. Today, the bank says it has $8.5 billion.

Stanford's CDs, which require a minimum investment of $50,000, offer tantalizing interest rates. The current rate on a one-year CD is roughly 4.5%, according to the bank's Web site. The average at U.S. banks is about 2%, notes research firm Bankrate.com (RATE). A year ago, the offshore bank sold five-year CDs that yielded 7.03%; the industry average hovered around 3.9%.

This has Ponzi scheme written all over it. If anyone has money invested in Sandford's CDs they better be worried or better yet get out.

Sonia

[TBF]

4. I've been watching this too -

The Houston Business website had a story this morning about Stanford being investigated.

[sonias]

5. Cornyn Took Caribbean Junket On Stanford's Dime

Talking Points Memo 2/17/09
Cornyn Took Caribbean Junket On Stanford's Dime
By Zachary Roth - February 17, 2009, 2:20PM

So we already knew that Allen Stanford -- the Texas banker charged by the SEC today with running an $8 billion "fraud of shocking magnitude" -- had some pretty impressive political contacts with both parties.

But it looks like his relationship with one of his home-state senators, Republican John Cornyn, may have been especially cozy.

According to Cornyn's Senate disclosure reports -- posted on the site Legistorm.com, which tracks privately financed trips by members of Congress -- the Stanford Financial Group paid for the Texas senator and an unnamed companion to take a November 2004 trip down to Antigua and Barbuda, the tiny Carribean nation where the company has its headquarters.

Not surprising to those of us in Texas who know that corndog has no qualm accepting money from anyone.

Sonia

[sonias]

6. SEC charges Allen Stanford with 'massive' fraud

AP News via Yahoo 2/17/09
SEC charges Texas financier with 'massive' fraud

By STEPHEN BERNARD,
AP Business Writer

NEW YORK – Federal regulators on Tuesday charged Texas financier R. Allen Stanford and three of his firms with a "massive" fraud that centered around high-interest-rate certificates of deposit, and raided some of the companies' offices.

In a complaint filed in federal court in Dallas, the Securities and Exchange Commission alleged Stanford orchestrated a fraudulent investment scheme centered on an $8 billion CD program that promised "improbable and unsubstantiated high interest rates."

Stanford's assets, along with those of the three companies, were frozen. Stanford's firms include Antigua-based Stanford International Bank, broker-dealer Stanford Group Co. and investment adviser Stanford Capital Management, which are both based in Houston.

The bank's chief financial officer, James Davis, and Stanford Financial Group's chief investment officer, Laura Pendergest-Holt, were also charged in the complaint.

U.S. District Court Judge Reed O'Connor has appointed a receiver to handle the frozen assets.

Sonia

[hobbit709]

7. Wonder who the "unnamed companion" was?

The answer could open ALL sorts of speculation.

[sonias]

8. he he he he

Was it the box turtle he can't keep his mind off? Or perhaps his little troll David Beckwith?

The Raw Story 7/2/2008
Cornyn staffer used fake name to 'troll' on blogs
(snip)
Over the weekend, a left-wing Texas political blog, Burnt Orange Report, reported rumors that Cornyn aide David Beckwith might even be fired over the ad. According to blogger Matt Glazer, "While good at what he does, he does have a tendency to make huge and erroneous errors. ... Beckwith's history of yap first, think second has absolutely gotten him in trouble."

Beckwith himself denied the rumors and insisted, "I am willing to bet anyone $100 that will go to Vets for Freedom if I have either been fired or am fired in the next few weeks."

However, by Monday a new controversy had arisen around Beckwith, with his unmasking by Burnt Orange Report as "Buck Smith," who had been posting both there and at other sites since 2007 in support of Cornyn's campaign.

:rofl:

Sonia

[sonias]

9. Stanford cutting and running

ABC News 2/18/09
Manhunt: Accused Financier Scammer Stanford Missing
Authorities say Investor Losses Could Rival Madoff Scandal

By BRIAN ROSS, JOSEPH RHEE, and JUSTIN ROOD
February 18, 2009

Texas financier R. Allen Stanford is accused of cheating 50,000 customers out of $8 billion dollars but despite raids Tuesday of his financial empire in Houston, Memphis, and Tupelo, Miss., federal authorities say they do not know the current whereabouts of the CEO.

The Securities Exchange Commission alleges Stanford ran a fraud promising investors impossible returns, much like Bernard Madoff's $50 billion alleged Ponzi scheme.

Investigators Tuesday shut down and froze the assets of three of the companies Stanford controls and they say the case could grow to be as big as the Madoff scandal. Like Madoff's clients, Stanford's investors are in shock.

So will John "corndog" Cornyn renounce and reject, and all that mumbo jumbo, his connection to Allen Stanford? Nah I didn't think so. He's keeping mum and laying low.


Sonia

[Dover]

10. And THIS is why we haven't and won't see any significant change coming from D.C.

It seems that almost ALL of them have their hands in the cookie jar:


Stanford's business is headquartered on the Caribbean island of Antigua. In the last decade, Stanford and his companies have spent more than $7 million on lobbyists and campaign contributions in efforts to loosen regulation of offshore banks.


Among the top recipients: Senator Bill Nelson (D-Fla.), Congressman Pete Sessions (R-Texas), Sen. John McCain (R-Ariz.), Senator Chris Dodd (D-Conn.) and Senator John Cornyn (R-Texas), one of the members who took a trip to Antigua where he was entertained by Stanford.

[sonias]

11. Pete Sessions and Katherine Harris too

Pictures at TPM:
Talking Points Memo Slideshow
Inter-American Economic Council '05 Caribbean Junket

Josh especially likes the one with Ann and Katherine starring into each other's eyes:

Stanford and Harris sitting in a tree....
"Our favorite is the one of Harris and Sir Allen gazing into each other's eyes".

Sonia

[sonias]

12. Drug money and Mini Madoff

ABC News 2/18/09
Accused Financier Under Federal Drug Investigation
Authorities: Stanford May Have Laundered Drug Money for Mexican Cartel
By JUSTIN ROOD and BRIAN ROSS
February 18, 2009

The SEC's fraud charges may be the least of accused financial scammer R. Allen Stanford's worries. Federal authorities tell ABC News that the FBI and others have been investigating whether Stanford was involved in laundering drug money for Mexico's notorious Gulf Cartel.

Authorities tell ABC News that as part of the investigation, which has been ongoing since last year, Mexican authorities detained one of Stanford's private planes. According to officials, checks found inside the plane were believed to be connected to the Gulf cartel, reputed to be Mexico's most violent gang. Authorities say Stanford could potentially face criminal charges of money laundering and bribery of foreign officials.

Authorities say the SEC action against Stanford Tuesday may have complicated the federal drug investigation.

May have complicated the federal drug investigation? If Stanford stole/lost drug cartel money, he's hiding from the Mexican mafia not the feds. This guy is in big shit trouble. He could just turn up dead.


Sonia

[sonias]

13. This part makes me really sick

ABC News 2/18/09
Donations to Democrats Outweigh those to Republicans

A total of $1.56 million was given to Democrats, according to OpenSecrets.org. Republicans received $840,000. Stanford also hired big-name lobby firms like DLA Piper and Parry, Romani and DeConcini.

Damn it!:grr: - I thought he was a 100% republican! :puke:


Sonia

[Sailing]

14. People like this...

only belong to one particular party. The party of "ME!"

[Baby Snooks]

15. He was all hugs and kisses with Nancy Pelosi last summer...

He apparently realized the Democrats were coming back into power and decided to buy who he could. The media is playing up the "kiss and hug" from Nancy Pelosi. Bottom line is neither party is very particular about who gives the money just as long as they give it. Apparently quite a few were suspicious about Allen Stanford for some time but said nothing although there was a lawsuit filed in late 2007 by two former employees who also reported the matter to the SEC which did nothing. Just as it did nothing about Bernie Madoff. No doubt there are some very important people involved in both. Particularly in the money laundering.

The firm itself was started by Allen Madoff's grandfather 70 years ago in Mexia. The big bucks started rolling in during the S&L disaster when Allen Madoff started buying up RTC properties for pennies on the dollar and started flipping them when the market improved.

And apparently there is a connection to the Bushes. But then there seems to be a connection to the Bushes with everyone these days. Including Bill Clinton. The big money trails in these scandals for some reason all lead back to the Bushes. Except for Bernie Madoff but maybe that is connected in other ways. Bernie Madoff wiped out liberal and primarily Jewish wealth that supported a lot of liberal causes. I doubt the Bushes cried any tears over that. But they may cry over Allen Stanford depending on how far the investigation goes.

[sonias]

16. Cornyn and Taliban Pete are keeping the Stanford money

Talking Points Memo 2/20/09
Mad Rush in D.C. to Give Back Stanford's Money ... Except Cornyn & Sessions
By Elana Schor - February 19, 2009, 9:33AM
(snip)
Sen. John McCain (R-AZ) got the ball rolling yesterday, vowing to get rid of his $28,150 in Stanford donations, and The Hill reports this morning that President Obama will follow suit for the $4,600 Stanford gave him during the campaign. Rep. Charles Rangel (D-NY) is also donating his Stanford contributions to charity.

But guess who's hanging on to the cash? Sen. John Cornyn (R-TX), who took slightly less than $20,000 from Stanford, and Rep. Pete Sessions (R-TX), who received about $41,000, according to local media reports.

Typical of the Texas Taliban to keep dirty money. :eyes:

Sonia

[sonias]

19. Corny was forced to give in on keeping the money

AAS 2/20/09
Cornyn to make up for contributions from Stanford

HOUSTON — Republican Texas Sen. John Cornyn said Friday he'll give $4,000 to charity to make up for contributions he accepted from Texas financier R. Allen Stanford.

Cornyn was making an appearance in Houston when was asked about contributions the billionaire made to his campaign and a four-day trip Cornyn and his wife took to Antigua that Stanford paid for.

"I am planning on returning campaign donations even though there has been no conviction and indeed no crime been alleged — it is strictly civil proceedings," said Cornyn.

So is Taliban Pete next?

Sonia

[sonias]

20. Well it's only 1/5 of the money Stanford gave him

TPM 2/20/09
Cornyn Gives Back (One-Fifth of) Stanford's Money
By Elana Schor - February 20, 2009, 4:58PM

We mentioned yesterday that Sen. John Cornyn (R-TX) was hanging onto the political donations he received from accused billion-dollar fraudster Allen Stanford.

But hold on! Cornyn seems to have reconsidered. The senator announced today that $4,000 would be donated to charity to offset contributions received from Stanford's company.

It's unclear how the $4,000 number was settled on, since Cornyn has received nearly $20,000 in Stanford-linked donations since 2000. But as chairman of the oft-cash-strapped Senate GOP campaign committee, Cornyn may have a serious need to hold onto all the contributions he can.

Sounds like Corny thinks he only has to comply just a little bit. Sort of like Bush' signing statements. "I'll sign this bill but I don't intend to follow it". Corndog thinks holding on to most of it is ethical because well because he says so.

Dope!

Sonia

[Baby Snooks]

23. They are asking for all the money back...

According to a report on Channel 13 in Houston the receiver has contacted both parties and asked that all campaign contributions be returned. Not just the recent ones. All of them. It will be interesting to see how both the DNC and RNC responds. I believe he and his wife have given almost $1 million through the years to politicians in both parties. Apparently the position of the receiver is that it was stolen money and so it needs to be returned to the depositors and investors. So much for Robin Hood.

There was over $8 billion in CDs in his bank in Antigua. The problem is the CDs are not there. Neither is the money.

And there are reports he handled around $50 billion in investment funds. Not all of which may be there either.

[Hangingon]

17. Oh boy - here we go again. Thank dog that Stanford is a republican!

http://abcnews.go.com/Blotter/story?id=6907429&page=1 Take a look at this coverage. He must be bipartisan.

[sonias]

18. You've missed half of the discussion since the OP

I've noted that he did in fact give more money to Democrats than Republicans. I bet he still votes as an R though. Just a hunch.

Either way I'll agree with you that he is a bi-partisan scammer.


Sonia

[Career Prole]

22. Like I told the arch-conservative at work...

"At least he had to buy the Democrats' votes...your boys gave him everything he wanted for free."
;)

[sonias]

21. Past probes sought to tie Stanford to drugs

Houston Chronicle 2/20/09
Past probes sought to tie Stanford to drugs

Authorities for years have investigated R. Allen Stanford, looking for ties to organized drug cartels and money laundering, going back at least a decade when the Texas billionaire’s offshore bank surrendered $3 million in drug money, state and federal sources told the Houston Chronicle Friday.

But no one has ever been able to make a criminal case.

Texas securities officials investigated, as did the U.S. Drug Enforcement Administration and the FBI. But none found solid evidence of a link between drug money and Stanford, who now stands accused of running a multibillion-dollar fraud at his offshore bank in Antigua and Houston-based brokerage firm.

In the late 1990s, according to court documents, operatives of the Juarez cartel began opening accounts at Stanford’s Antigua-based bank in an effort to launder money amassed under one of Mexico’s most vicious drug lords, Amado Carrillo Fuentes. Together, they used Stanford International Bank to open 10 accounts and deposit $3 million — a small sliver of the cartel’s fortunes but enough to pique authorities’ interest.

Sonia

[sonias]

24. FBI arrests Stanford Financial Group exec

AAS 2/26/09
FBI arrests Stanford Financial Group exec

HOUSTON — FBI agents arrested the chief investment officer of troubled Stanford Financial Group on Thursday, accusing Laura Pendergest-Holt of obstructing a Securities and Exchange Commission fraud investigation.

The SEC has been investigating allegations of an $8 billion investment fraud involving Texas billionaire R. Allen Stanford's financial group.

Pendergest-Holt was arrested in Houston, where Stanford Financial Group is based. The FBI said she was taken to the federal detention center and would appear in federal court Friday morning for an arraignment.

[sonias]

25. Billionaire Stanford to take the 5th in fraud case

AAS 3/11/09
Billionaire Stanford to take the 5th in fraud case
By JEFF CARLTON
Associated Press Writer

DALLAS — Texas billionaire R. Allen Stanford and one of his top officials have asserted their Fifth Amendment right against self-incrimination in the federal government's fraud case against them and Stanford's companies, according to court documents filed Wednesday.

Stanford said he will "decline to testify, provide an accounting or produce any documents" related to the Securities and Exchange Commission's civil case, which accuses him of running a "massive Ponzi scheme."

Finance chief James M. Davis, using similar language, also asserted his right not to incriminate himself.

Sonia