Apparently the link to Duck Tales and El Pato, the original Veneconomy articles has now been restricted somehow, as bandwidth limits were exceeded.
So you can find Duck Tales and El Pato here, I guess until I see the bill for my server.
I also have the Stanford Annual Reports and at some time I will be posting those to the net, since for some reason the Stanford International Bank website is no longer showing them. But they are large...so I'll keep them on my hard drive for a while.
These are important historical documents and could be part of case study for accountants/auditors sometime in the future.
EDIT: Stanford International Bank Annual Reports and December Letter have been uploaded to SCRIBD and avaliable HERE.
Saturday, February 28, 2009
Thursday, February 26, 2009
In Defense of Stanford
Several media outlets have now upped the tally on the alleged Stanford fraud from $8 billion (which is approximate) to $9.2 billion. We must come to the defense of Stanford on this one. It's really just $8 billion from the Antigua Bank (so far).
The other $1.2 billion arise from another part of the SEC Complaint which refers to a Mutual Fund Wrap program that Stanford Financial started in 2005. For those who don't know, a mutual fund "wrap" is like a Fund of Funds for mutual funds. Invest in one and you diversify over a series of mutual funds, each of which is supposedly also diversified. Double your diversification and double the fees you pay also.
Stanford Financial isn't accused of missappropriating (stealing) that $1.2 billion, but of misrepresenting the performance of the program. The program started in 2005, but Stanford already had a track record, which apparently was carefully "made up". And as they operated this program, they also "enhanced" the returns they were actually made. So the $1.2 billion should still be there for investors, but the $25 million they collected in fees...that maybe they shouldn't have.
This is also what the "disgruntled employees" were complaining about. (I was always wondering about that)
So why would Stanford set up a program like that and fudge the numbers to make a measly $25 million. Well, they brought a lot of advisors on board with it and those advisors were encouraged to...you guessed it...sell Antigua CDs.
I guess it shows where Stanford's real strength lied: in making up numbers.
Someone joked that the much ballyhooed "Stanford Investment Model" (SIM), actually stood for SIMulated.
The other $1.2 billion arise from another part of the SEC Complaint which refers to a Mutual Fund Wrap program that Stanford Financial started in 2005. For those who don't know, a mutual fund "wrap" is like a Fund of Funds for mutual funds. Invest in one and you diversify over a series of mutual funds, each of which is supposedly also diversified. Double your diversification and double the fees you pay also.
Stanford Financial isn't accused of missappropriating (stealing) that $1.2 billion, but of misrepresenting the performance of the program. The program started in 2005, but Stanford already had a track record, which apparently was carefully "made up". And as they operated this program, they also "enhanced" the returns they were actually made. So the $1.2 billion should still be there for investors, but the $25 million they collected in fees...that maybe they shouldn't have.
This is also what the "disgruntled employees" were complaining about. (I was always wondering about that)
So why would Stanford set up a program like that and fudge the numbers to make a measly $25 million. Well, they brought a lot of advisors on board with it and those advisors were encouraged to...you guessed it...sell Antigua CDs.
I guess it shows where Stanford's real strength lied: in making up numbers.
Someone joked that the much ballyhooed "Stanford Investment Model" (SIM), actually stood for SIMulated.
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