x Abu Dhabi, UAEThursday 18 January 2018

Stanford charged with fraud

SEC says "scheme was carefully orchestrated to make sure the true information never saw the light of day".

The Texas billionaire Allen Stanford, three associates and a top Caribbean regulator were indicted on fraud, conspiracy and obstruction charges in an elaborate $7 billion pyramid scheme to bilk investors, US Justice Department officials said. A federal judge in Virginia ordered Stanford, a flamboyant 59-year-old financier, to be transferred to Houston for a hearing on whether he should be granted bail on charges he orchestrated the fraud through his bank on the Caribbean island of Antigua.

He could face life in prison if convicted on all of the charges brought by a grand jury in Texas, the assistant attorney general Lanny Breuer told reporters in Washington. Stanford, who surrendered to FBI agents outside his girlfriend's house in Virginia late on Thursday, entered a Richmond federal courtroom in ankle shackles and sat straight with his chin in his hands during a brief hearing before US Magistrate Hannah Lauck.

"To go to Texas, yes ma'am," he said when Ms Lauck asked if he preferred to have his bail hearing in Houston or Virginia. Stanford and an executive Laura Pendergest-Holt, accountants Gilberto Lopez and Mark Kuhrt and Antigua's top regulator, Leroy King, were hit with 21 charges alleging they concocted a broad ruse to deceive investors, fabricate financial statements and hide their fraud. "This scheme was carefully orchestrated to make sure the true information never saw the light of day," said Robert Khuzami, the head of the Securities and Exchange Commission's enforcement unit.

Stanford, who lived lavishly and whose passion for cricket translated into generous backing for the sport in the cricket-loving West Indies, has denied any wrongdoing. His lawyer said the financier would fight the allegations. "He is confident that a fair jury will find him not guilty of any criminal wrongdoing," the attorney Dick DeGuerin said in a statement. His attorneys argued in Ms Lauck's court that Stanford was not a flight risk, but she said, "I do think there's sufficient evidence here to warrant a detention hearing."