CaribWorldNews, HOUSTON, TX, Thurs. June 25, 2009: Texas financier and Antigua citizen, Sir R. Allen Stanford, is scheduled for a court hearing today to decide whether he will be granted bail or will remain jailed until his trial.
Stanford was returned by U.S. Marshalls from Virginia yesterday, after begin charged on June 19th with money laundering related to an alleged Ponzi scheme involving the sale of certificates of deposit at his Antiguan bank.
Sir Allen, is accused of leading a $7 billion ponzi fraud. The once flamboyant businessman and billionaire, will appear at the federal courthouse in downtown Houston at 10 a.m. this morning for his bail hearing.
He is reportedly being held in federal prison in Conroe, about an hour north of Houston. According to the indictment, Stanford and his co-defendants engaged in a scheme to defraud investors who purchased approximately $7 billion in certificates of deposit administered by Stanford International Bank Ltd. (SIBL), an offshore bank controlled by Stanford and located on the island of Antigua.
`Stanford and his co-defendants allegedly misused and misappropriated most of those investor assets, including diverting more than $1.6 billion into undisclosed personal loans to Stanford himself, while misrepresenting to investors SIBL’s financial condition, its investment strategy and the extent of its regulatory oversight by Antiguan authorities,` said the Justice Department.
Also according to the indictment, Stanford, Pendergest-Holt and King conspired to conceal the fraud from the U.S. Securities and Exchange Commission (SEC) in order to fend off an SEC investigation.
King allegedly provided Stanford and others with confidential information that he had received from an official SEC inquiry into a possible fraud on investors by SIBL so that additional false representations concerning SIBL’s financial health and Antiguan regulatory oversight could be made. In addition, Stanford, Pendergest-Holt and others allegedly agreed that Pendergest-Holt would provide false information to the SEC about the true value of SIBL’s investment portfolio.
The indictment also charges Stanford, Pendergest-Holt, and King with conspiracy to obstruct an SEC proceeding. The indictment seeks forfeiture of the proceeds of the fraud from all defendants, including forfeiture of specific foreign bank accounts controlled by Stanford, Davis and Pendergest-Holt.
Also unsealed Friday was a criminal information charging James M. Davis, 60, SFG’s chief financial officer, with conspiracy to commit mail, wire and securities fraud; mail fraud; and conspiracy to obstruct an SEC investigation. The information seeks forfeiture of up to $1 billion in fraud proceeds. Davis will make his initial appearance on these charges in Houston in the near future.
Additionally, also unsealed was an indictment returned in the Southern District of Florida charging Bruce Perraud, 42, a former SFG Global Security Specialist, with destruction of records related to a federal investigation. Perraud allegedly ordered and supervised the destruction of numerous SFG documents housed at SFG’s Fort Lauderdale, Fla., office after he was put on notice that a federal court had ordered the preservation of SFG documents in connection with an SEC investigation and lawsuit. Perraud was arrested in the area of Naples, Fla., yesterday morning and will make his initial appearance in the near future.
`The Department of Justice will vigorously root out and expose financial crimes that wreak havoc on innocent investors,` said Lanny A. Breuer, Assistant Attorney General of the Criminal Division.
`Investors need access to accurate and truthful financial information in order to make decisions about how to invest their hard-earned savings. Their savings, and indeed the integrity of our capital markets, are jeopardized when investors are deceived. These difficult economic times make the mission of the Department all the more important.`
Stanford has maintained his innocence.
Laura Pendergest-Holt, Gilberto Lopez and Mark Kuhrt, three of his co-defendants, are free on bond and scheduled to appear in court today. Former Antigua Financial Regulatory Commission head, Leroy King, also remains free for now but U.S. prosecutors may seek to extradite him from Antigua. He was fired on Tuesday by the government of the island.