Stanford Bowled Out

It was three years in the making, but this morning in Houston a jury found Robert Allen Stanford guilty of 13 charges of conspiracy, obstruction and fraud, stemming from the operation of Antigua-based Stanford International Bank.

For a while there, I was wondering if "Sir Allen" was going to weasel his way out of this one, the same way his scam escaped detection for over two decades: hiding behind lawyers and other highly compensated professionals. Just yesterday, it had been announced that the jury was split on some issues. Apparently, that was only splitting hairs. Like many, I followed the trial on twitter (great job by the Houston Chronicle and KUHT...still going on at #stanfordtrial). Some the defenses expert witnesses' declarations were to put it mildly:  "far away from conventional wisdom". It's amazing what a few hundred thousand dollars in professional fees can do to your technical knowledge base.

Luckily, the jury didn't pull an OJ, and took the evidence for what it was worth.
On the side of the prosecution they showed detailed confession by a co-conspirator plus a money trail backed by documental evidence. Stuff that you just can't make up.

On the side of the defense, a two pronged alternate theory: that CFO James Davis worked alone or that there wasn't really a fraud. They brought in experts to state that taking out $2 billion in loans from your own bank (fraud), not disclosing the fact (fraud squared) and flatly denying any loans to anyone (fraud cubed) was all Ok. What's more, everything would be made right again when the pieces of the Stanford empire were put together in a "consolidation" plan. As if consolidating several piles of crap would yield something other than a larger pile of crap.
They didn't address the shortfall in investment returns, which was what gave the whole scheme away ultimately. Anyway, the jury didn't buy it. Unfortunately, we taxpayers will still have to pay for those experts' "work".

Naturally, this is not the end of the Stanford saga. There are still the criminal trials of the Chief Investment Officer (Pendergest-Holt), the accountants (Lopez and Kuhnt) and the Antiguan regulator (King), in addition to the certain appeals for Stanford and perhaps others. It does seem that if there were others in on the scheme, they mostly likely will get away.

For those who were caught in this web and lost their money, the journey towards closure is far from over. A trial currently taking place pitting the SEC vs. the SIPC, may give relief to some or perhaps yield just another disappointment. In the meantime, the process of asset recovery in Antigua and the US, has been so far fruitful only to the legal scavengers, for whom time is money and delay is profit. For now, investors have only received frustration.

So Stanford now joins Madoff, Rothstein, Nadel, Pearlman and many others in the Ponzi Hall of Convicted Felons.

He did manage to beat one of the wire fraud charges, the one relating to the purchase of Super Bowl tickets for Antiguan Regulator Leroy King in 2006. That botched my plans for a blog title reading "Stanford Bowled for a Duck".

Cricket fans would get it.

Crowdfunding gets its game on

(My daughter Astrid brought this to my attention. I found it interesting and asked her to write a Post about it. Enjoy!).

On Wednesday, February 8th, 2012 at 8:52 pm, the gaming world and the world of publishing any kind of media tilted ever so slightly on its axis. The main culprits of this shift are a small California based video game developer known as Double Fine productions and almost 50,000 fans and gamers who banded together to make the change.

For those of you not familiar with the gaming world, game publishing is a risky and unwieldy beast. Games, especially big name mainstream titles, take a lot of money to make and most publishers would never want to back a project doesn’t have 100% certainty of paying back the funds they’ve dropped into it.

Right here is where Kickstarter steps in. For those of you who haven’t heard of it, Kickstarter is a webpage that brings creative projects out into the public eye and allows people to crowd-fund them. Projects range form comic books, to documentaries. The amounts requested vary small $1,000 projects to much larger projects up in the hundred thousand range. The projects don’t receive the funds until the goal has been met and once the project is complete, depending on how much you donated, you might get a sweet little bonus for helping them out. It’s a small, but useful set-up for creative people to be supported by the internet at large.

So when Double Fine Productions decided to ask for $400,000 in order to produce an old school point-and-click adventure game and a documentary about its creation, they didn’t expect much. Point-and-click adventure games are considered a ‘dead’ genre in the games industry. According to the industry, these games don’t sell, so in turn they don’t get funded or get made. At best, the company was hoping to barely reach their goal and be able to produce a game, realistically, they barely expected to make $2,000.

But the internet has a mind of its own and once word got out, things got off the ground in a very big way. Within 8 hours, the Double Fine Adventure project had reached its intended goal of $400,000. In 24, they’d climbed all the way up to $1,000,000. That’s one million going towards a game for a ‘dead’ genre, a genre the mainstream doesn’t care to even touch.

At the time of writing, there’s still almost a month left to continue to fund the project and once the money is assigned, Double Fine is looking at almost $1,800,000. And that number is still climbing.

Admittedly, a lot of the success of the project can be attributed to Double Fine’s impressive pedigree (Founder Tim Schaffer is a huge name in the point-and-click gaming world, and their staff is a veritable all-star lineup for this sort of project) and its loyal fan following (who are still waiting patiently for Psychonauts 2, if anyone out there is listening).

But despite that the impact of this on the gaming community, and any creative medium, is almost mind-boggling. Kickstarter had already been funding smaller independent projects, but this proves that it can be done at a much larger scale. It could open up a new avenue of pay-to-create media that would take a lot of gamble and guesswork out of a normally outrageously risky project. Double Fine proved that if there is an audience, funding can be found, and it changes the basic way we can think about something being a risk, or sellable, or viable, or anything. The internet is changing the world, my friends, and I like the way this looks.