According to recently released Reuters news report, The Securities and Exchange Commission accused Robert Allen Stanford, the chief of the Stanford Financial Group, on Tuesday of conducting “a massive ongoing fraud” in the sale of about $8 billion of high-yielding certificates of deposit held in the firm’s bank in Antigua. Also named in the suit were two other executives and some affiliates of the financial group.
The company and its executives have been charged with misrepresenting the safety and liquidity of the uninsured C.D.’s. The S.E.C. complaint accuses Stanford Financial Group and its offshore banking affiliate of falsely stating client funds were invested in liquid financial instruments, when in fact they were invested in private equity funds and real estate.
The S.E.C. has requested that the defendants’ assets be frozen and that a receiver be appointed to take control of business operations. It also requested that the assets of the bank and other offshore units be returned to the U.S. The agency also requested the passports of all key Stanford executives be surrendered.
The S.E.C. has been under fire for ignoring warning signs leading up to the alleged Madoff $50 billion Ponzi scheme. S.E.C investigators had been monitoring the Stanford situation but increased the scrutiny after the Madoff scheme collapsed.
If you have invested money with the Stanford Financial Group or suspect your advisor may have misrepresented your investments, please contact our offices.