The Battle for Stanford's Bank

Posted by: Matthew Goldstein on March 13

The fight over the remains of disgraced financier R. Allen Stanford’s offshore empire is getting ugly.

A US investor is asking a court in Antigua to appoint a liquidator to wind down the operation of Stanford International Bank, the offshore bank at the heart of what US regulators say was a $8 billion Ponzi scheme.

Miami resident Alexander Fundora, in court papers obtained by BusinessWeek’s Unstructured Finance blog, says a liquidator is needed to preserve the bank’s assets, which are “at risk of dissipation at the hands of thousands of creditors seeking self-interested relief in multiple jurisdictions.” Fundora, the founder of a Miami-based home health care agency, invested $2.78 million in those now questionable certificates of deposits issued by Stanford’s bank.

The former health care executive wants the Antigua court to appoint two restructuring experts from PricewaterhouseCoopers as the liquidators. The PWC employees, according to court papers, have agreed to take on the job if the court approves.

“The US has no jurisidiction in Antigua, that’s what concerns me,” said Fundora, in an interview. He first invested with Stanford in 2006.

Still, if the court in Antigua grants Fundora’s request, it could create complications for Ralph Janvey, the Dallas lawyer serving as the court-appointed receiver for Stanford’s Houston-based brokerage firm. Janvey was appointed on Feb. 17, the same day the Securities and Exchange Commission filed civil fraud charges against Stanford and two of his top deputies. He’s supposed to be preserving assets for the thousands of investors in the US, Latin America and the Caribbean allegedly defrauded by Stanford.

Over the past two weeks, some Stanford investors had criticized Janvey for moving too slowly in unfreezing brokerage assets that had nothing to do with the offshore bank. On March 12, the receiver, in a bid to calm some of the investor anger, got the court to unfreeze some 28,000 customer accounts—about half of the estimated 50,000 accounts that Stanford Financial Group had worldwide.

Janvey also has drawn fire from more than 1,000 former Stanford employees who were fired on March 6 without any benefits or severance. Some employees claim they were told their health benefits would be continued for a while. Janvey could not be reached for comment.

Fundora’s motion also poses a challenge to the authority of London’s Vantis Business Recovery Services, the firm appointed by Antigua regulators. Fundora said Vantis may have a conflict of interest because Antigua officials have said the government owes Stanford some $100 million in loans. The 58-year-old Texas native is the largest landowner on the small Caribbean island nation.

It’s by no means clear whether Fundora will prevail in his legal motion. Nor is it known whether other investors will join with him.

But it looks like some investors simply aren’t going to wait for regulators to come up with a plan for dividing up Stanford’s assets.

Reader Comments

Bob Snyder

March 13, 2009 07:40 PM

"the offshore bank at the heart of what US regulators say was a $8 billion Ponzi scheme." I'm sorry but this grammatical mistake drives me crazy. It should be "an $8 billion Ponzi scheme." Say the sentence out loud and you'll realize it doesn't sound right.

EDDIE BATIZ

March 14, 2009 09:47 AM

I would like to join Mr. Fundora. I also invested in the Standford International Bank CD.Send me more information please.

Jose Silveira

March 14, 2009 04:26 PM

I also have a CD account in the Stanford International Bank in Antigua.
Please send me more information.

Wilfrido Martina

March 14, 2009 06:05 PM

Dear sir

I have invested my pensunfunds in CD

Thanks

Eve John

March 14, 2009 06:19 PM

Yes please, Mr Fedora, I would be so grateful if you would keep me in your information loop. yours Eve John

Barney Hallman

March 15, 2009 01:10 PM

There are over 140 of us that have lost our life savings in these CDs.
We have a discussion forum where we post the latest information, and work at developing and implementing our action plan to recover our lost investments.
If you are interested you can visit the forum at http://www.sibfraud.com/
There is no cost to become a member and participate.

Barney Hallman

March 15, 2009 02:09 PM

There are over 140 of us that have lost our life savings in these CDs.
We have a discussion forum where we post the latest information, and are developing and implementing our action plan to recover our lost investments.

If you are interested you can visit the forum at http://www.sibfraud.com/

There is no cost to become a member and participate.

Alexander Fundora

March 15, 2009 04:05 PM

If I can answer any questions feel free to contact me at Alfund@Gmail.com

Zelays Trust

March 15, 2009 05:54 PM

The US government has no jurisdiction in another sovereign nation's affairs. Thus, the scandal has only served to hurt us the investors and it will produce no real results for us, unless our monies are all invested within US territory, and that is only "maybe". In the meantime Stanford International Bank in Antigua and Barbuda is a chaos and no one is questioning where our money went. Please include us as part of a group of investors who should be doing something legally directly in these islands such as seizing Stanford's properties, which no one seems to be doing.

David MacKenzie

March 16, 2009 03:53 PM

I'd be very interested to see how this pans out. As it stands, Vantis can simply look for funds to pay it self, and then declare SIB nonviable, essentially bankrupt. As with all bankruptcies the government is first in line...and of course the investors are last in line. Therefore the government is smiling all the way to the bank as much of Stanford's assets are already in in Antigua and indeed include what the Government of Antigua actually owes Stanford. Imagine the motivation of the the Government.

There is the misconception, fuelled somewhat by the press, that only drug cartels, gun-runners, money launderers and "South Americans" have their ill-gotten gains in SIB so who cares what these evil people lose. The depositors need to get organised to ensure that the powers that be don't pass this lie of as the gospel as they wont need much more than that as the smoke and mirrors required to capture the remaining assets of the Stanfor empire.

webmaster

March 19, 2009 10:55 PM

Check out the web site of The Stanford Victims Coalition. It has important info:
www.sibfraud.com

ramon valls

April 4, 2009 11:01 AM

I have a cd.would like to know where do i stand.Is there any posibility of recovering the funds

Thank you for your interest. This blog is no longer active.

 

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BusinessWeek's Adrienne Carter, Jessica Silver-Greenberg, and David Henry deconstruct the mysteries of high finance, Wall Street, and hedge funds for pros and ordinary investors. E-mail them directly if you've got tips about big deals, a hedge fund, or even securities industry gossip.

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