Tech & Biz

Allen Stanford: Billionaire Charged, Could Face 250 Years in Jail

by peder.sande | June 19, 2009 at 11:23 am

533 views | 4 Recommendations | 2 comments

Texan Billionaire Sir Allen Stanford, a prominent financier, has been indicted on a long list of charges. Stanford was taken by FBI officers from his girlfriend’s house in Virginia.

The current charges against him include:

Conspiracy to commit wire fraud
Mail fraud and securities fraud
10 counts of mail fraud
Conspiracy to obstruct an investigation for the Securities and Exchange Commission (SEC)
Obstruction of an investigation by the SEC
Conspiracy to commit money laundering

He could face up to 250 years in prison if convicted on all charges, assistant Attorney General Lanny Breuer said

If convicted on all charges put against him, Stanford could face 250 years in prison. Stanford supposedly will be charged with fraud totalling up to $8 billion USD - $7 billion of which was tied up in certificates of deposit from Stanford International bank.

He already faces civil charges over an alleged fraud worth $8bn (£6bn) - charges he denies.

Other Stanford Financial Group Executives Charged:

Laura Pendergest-Holt
Gilberto Lopez
Mark Kuhrt
Bruce Perraud
James M Davis

The indictment also said Sir Allen made corrupt payments to Leroy King, 63, a former head of Antigua's financial services regulatory commission, who has also been charged.

The press and officials have related Stanford’s fraud to the Madoff Ponzi scheme. Stanford and the other accused have denied these allegations pointing to the fact that billions of dollars are still there.

"If it was a Ponzi scheme, why are they finding billions and billions of dollars all over the place?"

Stanford International Bank's presence in tax havens such as Antigua or Stanford Global Management Complex in the Virgin islands, which offer favorable tax breaks, may have caused concern from the Obama administration. Earlier this year with diving tax revenues, due to the recession, Barack Obama declared a revamping of the “broken tax system.” This coupled with outrage from lax financial regulation and investment scandals have spawned large inquires into what financial institutions are doing offshore. This need for more global financial transparency has been shown in monitoring groups shut as the OECD/G-20 white-list, which ranks a financial transparency with world tax authorities.

As a “downpayment” on a “simpler and fairer and more efficient” tax system, which would also raise $210 billion over ten years, Mr Obama promised tighter rules on the taxation of businesses’ foreign earnings and a crackdown on the use of tax havens.

The ponzi scandals have put pressure on President Obama for increased consumer protection. Obama has recently unveiled a large scale consumer protection agency. The agency would tie the hands of financial institutions, which provide financial services to the private consumer.

As President Barack Obama's recently introduced blueprint for financial regulatory reform prepares to wind its way through Congress, industry lobbyists are gearing up to fight one of its key provisions: the establishment of a standalone consumer protection agency.

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Spydermonkey

at 13:56 on June 19th, 2009

I want to see where this one goes. Could be interesting.

Roy C

at 15:47 on June 19th, 2009

This, ENRON, Madoff, AIG, the whole sale of worthless mortgages in bundles with AAA ratings from Moody's- Wall Street is lucky that there hasn't been a revolution out there from the regular folk.