Accused Ponzi Schemer Stanford Indicted For Fraud

Jun 19 2009 | 1:20pm ET

R. Allen Stanford, the Texas billionaire, fund of hedge funds manager and accused Ponzi schemer, has been indicted for fraud and obstruction of justice by federal prosecutors in Houston.

Stanford turned himself in to the Federal Bureau of Investigation yesterday in Virginia. He is due to appear in Richmond federal court today.

According to prosecutors, Stanford ran a $7 billion Ponzi scheme through his Stanford Financial Group. His firm was shut down by the Securities and Exchange Commission in February. An SEC civil complaint accused Stanford of promising big returns in investments he said were certificates of deposit, lying about their historical performance and safety. Three of his companies also had their assets frozen.

Six others were indicted along with Stanford, including Leroy King, head of Antigua’s Financial Services Regulatory Commission. King, a dual American-Antiguan citizen like Stanford, is accused of accepting bribes from the alleged Ponzi schemer, and has been on leave since March.

Also indicted—and arrested—were five Stanford executives and employees. Laura Pendergest-Holt, the chief investment officer who was already charged in February with obstruction, Gilberto Lopez, chief accounting officer, and Mark Kuhrt, global controller, were each charged with fraud and obstruction. James Davis, chief financial officer, was charged with fraud and conspiracy to obstruct an SEC investigation, while Bruce Perraud, a former global security specialist at Stanford, was charged with destroying documents.

In addition, the SEC, which had already charged Stanford, Davis and Pendergest-Holt, has added charges against Lopez and Kuhrt. The regulator says the two “reverse-engineered” Stanford International Bank’s financial statements to report nonexistent income. The SEC also charges King, saying he “looked the other way” in exchange for bribes.

RETALTED LINK:

Stanford Indictment (Court Documents)


In Depth

Q&A: Neil Azous Talks Global Macro Investing

Nov 24 2014 | 12:41pm ET

Neil Azous is the founder and managing member of Rareview Macro, an advisory firm...

Lifestyle

Scene Last Night: Clinton, Schwarzman, Corzine, Neidich, Diamond

Nov 25 2014 | 5:52pm ET

Steve Schwarzman had a granddaughter yesterday morning. Last night he sat one table...

Guest Contributor

Why The Big Money Is Going To Europe

Nov 14 2014 | 6:03am ET

Peer-to-peer lending was invented with the individual investor in mind. But despite...

 

Sponsored Content

    For Hedge Funds, Mastering Data Is Key To Success

    Nov 4 2014 | 9:45am ET

    Data management is important to every business, but for hedge funds, it is critical. FINalternatives recently asked Peter Sanchez, CEO of Northern Trust Hedge Fund Services, how fund managers can deal with the demands of managing data while at the same time remain transparent and abide by operational best practices. Read more…

Editor's Note

    Guidelines for Guest Articles

    Oct 22 2014 | 9:46am ET

    We are always looking for guest articles from hedge fund managers and buy-side firms.

    If you are interested in submitting a contributed piece for possible publication on FINalternatives, please take a look at the specs. Read more…

 

Futures Magazine

November 2014 Cover

Building a better market

Reg NMS created a huge bifurcation in equity markets and while much of what has followed has been positive, in terms of lower fees and greater liquidity, many traders would like to see the market come...

The Alpha Pages

TAP July/August 2014 Cover

The Alpha Pages Interview: Senator Rand Paul

Senator Paul sat down in the debut series of the Alpha Pages Interview to discuss the broken tax code, regulation surrounding Bitcoin, and his plans for the 2016 Presidential election.