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Was Allen Stanford in league with Bernie Madoff?
By Lauren | February 19, 2009
As the bad news on the economy continues to worsen (at this point, nobody seems to be predicting a recovery any time this year), it’s disheartening to learn that yet another big investment guru has been charged with massive fraud. The Securities and Exchange Commission has charged Texas billionaire Allen Stanford and three of his companies with fraud on a worldwide basis. According to the SEC, Stanford and two of his cronies allegedly sold $8 billion in phony high-yield certificates of deposit to well-to-do investors around the world. Folks were lined up today at the Stanford International Bank in Antigua, begging to get their money out and being turned down flat.
Is it really any surprise that Stanford’s investments were apparently exposed to losses from Bernie Madoff’s alleged Ponzi scheme?
Unfortunately, there’s a lot of truth to that old proverb about birds of a feather flocking together. Only time will tell whether Stanford was a victim of Madoff’s alleged misconduct or a willing participant. In the meanwhile, however, Stanford’s investors can’t get to whatever money they still have, the SEC will take yet another public beating for not stopping the alleged fraud sooner, and the lucky folks who still have money around to invest are going to be that much more nervous about putting anywhere but under the mattress.
The story got even more interesting earlier today when federal officials announced that they didn’t know where Stanford was, which would have made it difficult to pursue the charges against him. A few hours ago, however, the FBI found him in Virginia, not hiding out, just doing whatever it is billionaires charged with investment fraud do. Presumably, that means that we’re about to learn a whole lot more about Allen Stanford, and maybe about Madoff as well, as the case against Stanford moves forward. Somehow, I doubt we’re going to like what we’ll hear.
Topics: Business Ethics, Personal Ethics, corporate responsibility, ethics |