Stanford Judge Approves Interim Distribution to Victims

A plan by a court-appointed receiver to distribute assets recovered from R. Allen Stanford’s Ponzi scheme to investors was approved by a federal judge in Dallas.

U.S. District Judge David C. Godbey accepted the plan by Ralph Janvey, the receiver appointed in 2009 to marshal and liquidate Stanford’s personal and business assets, to make a $55 million interim distribution to about 17,000 claimants, or about 1 cent for each of the $5.1 billion lost in the fraud scheme.
“We will follow it up in a subsequent distribution as the money comes in,” Janvey’s attorney, Kevin Sadler of Baker Botts LLP, told Godbey at a court hearing in April.

Ponzi scheme victims of Bernard L. Madoff, who was arrested in December 2008, recovered more than $5.4 billion. Clients of the MF Global Inc. brokerage were paid about $4.9 billion after its parent, MF Global Holdings Ltd., failed in October 2011. Victims of a scheme by Peregrine Financial Group Inc. founder Russell Wasendorf, who prosecutors last year said stole $215 million, received an interim distribution of $123 million.

A federal jury in Houston last year found Stanford, 63, guilty of lying to investors about the nature and oversight of certificates of deposit issued by his Antigua-based bank. The jurors decided he must forfeit $330 million in accounts seized by the U.S. government.

The SEC case is Securities and Exchange Commission v. Stanford International Bank, 09-cv-00298, U.S. District Court, Northern District of Texas (Dallas). The criminal case is U.S. v. Stanford, 09-cr-00342, U.S. District Court, Southern District of Texas (Houston).

To contact the reporter on this story: Andrew Harris in the Chicago federal courthouse at
aharris16@bloomberg.net
To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net


Read more: http://sivg.org/article/2013_Stanford_Judge_Approves_Interim_Distribution_to_Victims.html

For a full and open debate on the Stanford Receivership visit the Stanford International Victims Group - SIVG official forum http://sivg.org/forum/

Allen Stanford Told to Disgorge $6.7 Billion in SEC Case

R. Allen Stanford, the Texas financier convicted last year of leading an investment fraud scheme, was ordered to disgorge more than $6.7 billion by the judge in a U.S. Securities and Exchange Commission lawsuit.

U.S. District Judge David Godbey in Dallas issued the order yesterday against Stanford, his Stanford Group Co. and the Antigua-based Stanford International Bank Ltd.

The order may clear the way for Godbey to grant a court- appointed receiver’s request to make an interim $55 million payout to investors who lost money after buying certificates of deposit issued by the Stanford Bank.

“The fraud perpetrated was obviously egregious, was done with a high degree of scienter, caused billions in losses and occurred over the course of a decade,” Godbey said, using the legal term to describe the mental state of intent to deceive.

A federal jury in Houston convicted Stanford of lying to investors about how their money was being handled.

“The truth is that he flushed it away,” Justice Department lawyer William Stellmach told jurors in his closing arguments at the March 2012 trial. “He told depositors he was using their money in one way and the truth was completely different.”

Stanford, 63, was sentenced to 110 years in prison. Maintaining his innocence, he has appealed the verdict.


Parallel Judgment


Godbey referred to the jury’s guilty finding in granting the SEC’s request he render a parallel judgment in their case filed in February 2009, four months before the financier was indicted. The judge also cited the August 2009 guilty plea by Stanford Group Chief Financial Officer James Davis.

“The court finds that $5.9 billion is a reasonable approximation of the gains connected to Stanford’s fraud,” Godbey said of the sum he would order disgorged. He then added more than $861 million in interest for a total of $6.76 billion. Davis too is jointly liable.

Finally the judge imposed a $5.9 billion penalty on Stanford and a $5 million assessment against Davis, who received a five-year prison sentence.

The court-appointed receiver, Ralph Janvey, asked Godbey this month for permission to begin repaying some of the losses incurred by the more than 17,000 claimants. At an April 11 hearing, the judge told Janvey’s lawyer, Kevin Sadler, he was concerned about doing so before a final order had been entered against Stanford.


Societe Generale


In a separate filing today, a group of Stanford investors asked Godbey to grant them a judgment of at least $95 million in a lawsuit against a unit of Paris-based Societe Generale SA. (GLE)

The lender’s Societe Generale Private Banking (Suisse) unit took the money from a Stanford bank account with his permission in December 2008 to repay a loan made to him four years earlier, according to court papers.

The financier had caused a business funded by Stanford investor-depositor money to guarantee the loan in 2007, the investors alleged, while those depositors received no benefit. The transfer of that money to Societe Generale just two months before the SEC sued Stanford and shut down his businesses was a fraudulent transfer, the investors claimed in today’s filing.

Ken Hagan and Jim Galvin, New York-based spokesman for the French bank, did not immediately reply to voicemail messages seeking comment on the allegations.


Slush Fund


Davis, the CFO, testified at Stanford’s trial that the financier maintained a Societe Generale Swiss bank account, funded by investor deposits.

“It was a slush fund, just used for whatever the holder wanted to use it for,” Davis said during the Houston federal court trial in February 2012.

The SEC case is Securities and Exchange Commission v. Stanford International Bank, 09-cv-00298, U.S. District Court, Northern District of Texas (Dallas). The criminal case is U.S. v. Stanford, 09-cr-00342, U.S. District Court, Southern District of Texas (Houston).

The investors’ case is Rotstain v. Trustmark National Bank, 09-cv-02384, U.S. District Court, Northern District of Texas (Dallas).

To contact the reporter on this story: Andrew Harris in the Chicago federal courthouse at aharris16@bloomberg.net

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net

Source: http://sivg.org/article/2013_Stanford_Disgorge_6Billion.html

For a full and open debate on the Stanford Receivership visit the Stanford International Victims Group - SIVG official forum http://sivg.org/forum/

Louisiana officials want release of SEC report in Stanford case

A Louisiana senator told officials of the Securities and Exchange Commission Friday that he wants immediate release of a year-old report by the commission’s inspector general on efforts to recover money for victims of a multibillion-dollar fraud.
U.S. Sen. David Vitter, R-La., described as incompetent efforts by a court-appointed receiver to find and distribute assets of convicted con man Robert Allen Stanford.
Stanford, 63, of Houston, is serving a 110-year prison sentence for a fraud conviction that followed estimated worldwide losses of approximately $7 billion. About $1 billion of those losses were from about 1,000 investors in the Baton Rouge, Lafayette and Covington areas, according to estimates by state Sen. Bodi White, R-Central, and Baton Rouge attorney Phillip W. Preis.
“The fraud caused an absolute tragedy for many Louisiana families who invested their hard-earned retirement savings in good faith that it would be there for them when they retired,” Vitter said Friday in a letter to Mary Jo White, who chairs the SEC.
Vitter said the receiver in the case, Dallas attorney Ralph Janvey, spent $100 million to collect $55 million for Stanford’s victims.
“In the best light, Janvey’s actions can only be seen as incompetent,” Vitter told White in that letter. He urged White to release the SEC inspector general’s report on Janvey, noting that it was completed in March 2012.
There are more than 20,000 Stanford victims across more than 100 countries.
A retired Zachary couple, Louis and Kathy Mier, saw $240,000 of their savings stolen by Stanford’s fraudulent scheme.
“Whatever any of our congressmen do to shed light on the truth of what happened, and whatever they can do to help us get our money back and be whole again, would make Louis and me very, very happy,” Kathy Mier said Friday.
John J. Nester, a spokesman for the SEC, said in an email Friday that neither he nor other SEC officials would comment on Vitter’s request before White issues a response to the senator’s letter.
U.S. Sen. Mary Landrieu, D-La., released a statement through her staff: “The Stanford victims deserve answers, and the immediate release of the IG’s report is the very least the SEC can do.”
U.S. Rep. Bill Cassidy, R.-Baton Rouge, said through his staff: “I strongly urge the SEC … to release the full results of the inspector general’s report. The victims of this crime were hard working Louisiana families, and they are entitled to see the details of the report.”
Vitter noted that Janvey, against the SEC’s wishes, unsuccessfully sued some Stanford victims in an effort to seize money those victims retrieved before Stanford’s operations were shut down in February 2009.
“Given the demonstrated incompetence of the court-appointed receiver, it makes you wonder how bad this (inspector general’s) report gets,” Vitter added. “The Stanford victims deserve to see.”
“Given the demonstrated incompetence of the court-appointed receiver, it makes you wonder how bad this (inspector general’s) report gets. The Stanford victims deserve to see.” U.S. Sen. David Vitter, R-La.


Source: http://sivg.org/article/2013_Louisiana_want_release_SEC_report_Stanford_case.html

For a full and open debate on the Stanford Receivership visit the Stanford International Victims Group - SIVG official forum http://sivg.org/forum/

OPEN LETTER TO JANVEY AND JLs. FOR IMMEDIATE RELEASE

March 12, 2013
FOR IMMEDIATE RELEASE

TO:
Mr. Ralph Janvey
Mr. Marcus Wide
Mr. Hugh Dickson

CC:
Mr. John Little
Mr. Edward C. Snyder
Mr. Kevin M. Sadler
Mrs. Jennifer Ambuehl

Dear Mr. Janvey, Mr. Wide and Mr. Dickson,
Months have gone, it is March 2013 and the real victims of the Stanford fraud (hereinafter "we", "us") have not yet received any information about the distribution of our money located in the USA and abroad.

So far we have suffered from lack of information and transparency. However this should not happen because you are working for us.

As it was mentioned by the OSIC in January 22, 2013: "We (the OSIC) strongly believe that you, the victims of this horrible crime, should decide how your money is spent, and whether all available funds should be distributed to you, or to fund ongoing efforts by the receivership or the joint liquidators"

We demand that all the money collected so far to be immediately distributed to us.

We agreed all together with this petition and as both of you are working for us (and both of you have being paid so far with our money), you must listen to our petition. We have taken this decision, so please inform us as soon as possible:
1- how much money there is for distribution so far identified in the USA and abroad
2- how the complete distribution will be effectively implemented and how all the money will be paid to us.

We cannot keep waiting and waiting.

Sincerely,
The real victims of the Stanford fraud

Sign the open letter to Janvey and JLs. ( View how many victims have accepted this letter)

Read more: http://sivg.org/article/2013_OPEN_LETTER_TO_JANVEY_AND_JLs.html            

For a full and open debate on the Stanford Receivership visit the Stanford International Victims Group - SIVG official forum http://sivg.org/forum/