Stanford Victims’ Good and Bad News

Chidem Kurdas

The myriad politicians and political committees who received money from the fraudster Allen Stanford have returned almost $2 million to the estate, bringing up the total collected by the receiver to $230 million. On the down side, the receiver Ralph Janvey has spent $119 million on fees and expenses, much of it going to the lawyers who work with him.

Last Friday US Senator David Vitter for Louisiana sent a letter to the new SEC chair, Mary Jo White, complaining about Mr. Janvey’s fees and actions against Stanford investors. “I have had major problems with the court appointed receiver in this case,” says the senator.

Receivers of estates left from Ponzi schemes are appointed by the US Securities and Exchange Commission and approved by a judge. The way the SEC appointed Mr. Janvey as has been subject to an investigation by the agency’s own watchdog. In his letter Senator Vitter requested the full report from the investigation.

Only a redacted version has been released so far. It suggests that the SEC did not follow its own rules in making the appointment.

Stanford conned a total of $7-to-$8 billion from people across the world and lost most of it in real estate ventures in the Caribbean and Florida — click for Political Sticky Wicket: The Untouchable Ponzi Scheme of Allen Stanford

After the SEC shut down the Stanford operation, assets were frozen as estate receivers backed by different governments fought each other at the expense of the victims. Recently an agreement was reached between the Antiguan liquidators and the American receiver and approved by courts and the SEC.

The agreement gives additional resources to the liquidators and receiver.  Senator Vitter asks: “Please provide me with details as to why the SEC supported this agreement?”

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