x Abu Dhabi, UAEFriday 28 July 2017

Stanford missing after fraud claim

Two days after the US Securities and Exchange Commission accused Sir Allen Stanford of perpetrating "a fraud of shocking magnitude," he remains missing.

Authorities were trying to track down Texas billionaire financier Sir Allen Stanford today as fraud charges against the cricket promoter prompted panicked investors to withdraw cash from his banks. Two days after the US Securities and Exchange Commission accused Sir Allen, 58, of perpetrating "a fraud of shocking magnitude," SEC officials were still in the dark about his whereabouts - as too were close members of his family.

Authorities in the Caribbean island of Antigua and in parts of South America meanwhile sought to quell fears among depositors as long queues formed outside branches of his bank. In an interview with the Houston Chronicle newspaper, Sir Allen's 81-year-old father James said that he had no idea of his whereabouts. "I'd spoken to him a week or so ago - he'd called - about problems with the business climate in general, but nothing of this magnitude," he said.

"I cannot imagine, I cannot believe, I will not believe what is being alleged actually happened." James Stanford said he understood that authorities were trying to track down his son, but insisted he didn't know where he was. "I cannot believe that my son would run," he added. Investors were meanwhile growing fearful about the status of their investments in Sir Allen's offshore bank and his Houston-based brokerage.

"We're just sick about it. It's visceral," Sandra Walsh, a retired school librarian in Houston, said. Ms Walsh said she and her husband kept their life savings in an account at Stanford Financial Group. A substantial portion of Sir Allen's clients are in South America, where the Venezuelan government issued a request for more information from US authorities. In Ecuador, transactions at the Stanford Financial Group were temporarily suspended yesterday.

In Antigua, hundreds of people queued yesterday at the Stanford-owned Bank of Antigua to withdraw funds. The SEC filed civil charges on Tuesday against Sir Allen for what they called fraud "of shocking magnitude" in selling US$9.2bn in securities, "promising ... improbable high interest rates". A US district judge consequently froze Sir Allen's assets. Sir Allen's alleged scheme is the most high profile since Wall Street financier Bernard Madoff was charged in a $50billion Ponzi scheme in December.

* AFP