Stanford Investment Fraud
R. Allen Stanford of the Stanford Financial Group is accused of a massive, on-going $8 billion investment fraud. If you have incurred a serious financial loss as a result of the Stanford investment fraud, you may be entitled to recover losses from those responsible. Contact a Houston litigation attorney to learn more about your options.
Understanding the Stanford Investment Fraud Case
With an estimated net worth of $2.2 billion, R. Allen Stanford, is the 205th wealthiest person in the U.S. He began his career in the Houston real estate market in the early 1980s and claims he moved on to take over his grandfather's company, Stanford Financial Group. Although claims assert that Stanford Financial Group was established in 1932, there are no records of the bank before the 1980s. Stanford quickly expanded Stanford Financial Group into a global wealth management and investment banking firm, opening offices in North America, Latin America and Caribbean.
R. Allen Stanford has enjoyed an extravagant lifestyle with multiple homes, private jets, and high profile, political friendships. Over the last decade, he has given millions to politicians and lobbyists, reportedly thought of, as an attempt to preserve and expand tax breaks in the U.S. Virgin Islands and to purport credibility. After news of fraud allegations and his offices being raided, many recipients of his donations vowed to forward the money to charities.
Another indication of Stanford's luxurious life-style is his involvement in sports sponsorships.
He is a title sponsor for many professional sports, particularly sailing, cricket, golf and tennis. Some of his sponsorships include the PGA Tour, Stanford St. Jude Championship, and professional golfer Vijay Singh. Stanford also established cricket grounds and tournaments in Antigua for which he was knighted; his motivation for this is thought to be not only an exhibition of his wealth, but also an attempt to appear charitable and good-hearted.
On February 17, 2009, the U.S. Securities and Exchange Commission raided Stanford's Houston, Memphis and Tupelo offices, alleging $8 billion in investment fraud. According to allegations, Stanford Financial Group convinced clients to invest in a certificate of deposit program that offered extremely high returns in short periods of time. Stanford duped affluent investors by presenting them with hypothetical investment results as historical results. It is believed Stanford has been selling "improbable, if not impossible" returns for 10+ years.
In 2000 the company claimed their Stanford Allocation Strategies Program, a managed mutual funds program, had positive returns of 18.04%, when, in reality, it lost 7.5%. In 1995 and 1996, the company submitted identical returns suggesting that the scam has been going on for at least 13 years. Although, Stanford told clients their investments were being handled and monitored by a large team of analysts, the majority of investments were managed by Stanford himself and James Davis, Stanford International Bank's chief financial officer, who is also being charged in the case. The third person charged in the case is Laura Pendergast-Holt, chief investment officer.
How a Houston Investment Fraud Lawyer Can Help You
If you have incurred a serious financial loss as a result of the Stanford investment fraud or another fraudulent investment, talk to a Houston investment fraud attorney from our office. You may be entitled to recover losses from those responsible. Contact a Houston investment fraud attorney to learn more about your options.