Friday, April 17, 2009
I hate to leave the blog without any new material for so long, so a quick update on the Stanford issue. First of all, you can get exceptional extended coverage of the case at Venepirámides (in Spanish) or the Stanford Watch at the Houston Chronicle. Someone also set up a twitter. (Don’t ask me to explain twitter…I still don’t get the blogging deal).
Summing up. In Antigua the courts authorized that SIB go into liquidation and Vantis the receiver becomes Vantis the liquidator. Here’s a good link from the BBC. You can hear Vantis on Radio HERE. Scroll to minute 32 which is where the Stanford part starts.
The liquidator also had bad news for SIB depositors, confirming that SIB was in fact very much akin to a ponzi scheme. Since SIB is in liquidation, depositors have become creditors. No distributions are expected any time soon and the bank could take as long as 5 years to “wind up”. This is unfortunate and probably reflects that liquid assets have been scarcer than I believed and perhaps the only Tier II assets are those in the CS account that was frozen by the SEC. (see Begun,,,,).
It is also unfortunate because it hinders and delays other legal action that depositors could take against third parties. How can you sue for losses, until you know how much those losses actually are? (You can...but this is a bother) A quick wind up of SIB would have been ideal.
In the meantime, the Houston receiver Ralph Janvey, had his motions to control assets in Antigua quashed, but he still managed to sue 66 US advisors for over $40 million in commissions from CD sales. Normally I would link the complaint, but it lists these advisors’ home addresses and that really wasn’t a good idea if you ask me.
Also the first interest “clawback” was achieved as an investor accepted to put aside some $15,000 he had received in SIB CD interest in the past, in exchange for getting his brokerage account unfrozen. LINK
Oustide the US, the Panamanian Authorities were accepting bids for the local Stanford Bank. LINK. The results of the bids weren’t to be disclosed immediately. LINK.
The Venezuelan bank will go to auction again, after the first bidding process didn’t yield a result acceptable to the government. This time the government will not get a “premium” for the bank, all the money will go to recapitalizing the bank itself (so the investor is just paying himself and absorbing losses). LINK.
And count Mexican soap opera actress Laura Zapata among Stanford’s victims. LINK LINK.
Yes, that is her picture at the top of the post.
As for as the criminal case, Allen Stanford now has a lawyer, but he doesn’t expect charges to be brought for a couple of weeks. Oh…and the mother or his girlfriend defends his innocence. Shocking! LINK.
More interesting, however, is that David Finn, who is CFO Jim Davis’ attorney has a blog. Not really much case discussion, though…except for one little headline:
“My baloney has a first name..it’s A-L-L-E-N". LINK
Davis and Stanford were roomates at Baylor University back in the '70s.
I think this is the END of a beautiful friendship, Louis...I mean Allen.
Update: BW reports on SIB's accounting "multiplicity".
Posted by Alex Dalmady at 11:30 AM