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Billionaire accused of fraud is found in Stafford
Stanford was reportedly staying in a townhouse in the Heather Hills subdivision in southern Stafford. The home of interest has an American flag flying in front of it.
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|Click here to see the civil complaint by the Securities and Exchange Commission|
By Edie Gross
An encounter last November between a Free Lance-Star reader and Stanford seems to support the idea that his girlfriend has local ties.
The reader e-mailed the paper last night, saying Stanford bought the reader's family dinner at Claiborne's on Nov. 7 after the family agreed to give up its earlier reservation time.
"He introduced himself as Allen Stanford, said he lived in the Virgin Islands and that his girlfriend's parents lived in the area," the reader wrote.
The SEC filed its civil complaint against Stanford, his companies and several of his associates on Tuesday in U.S. District Court in Dallas.
The complaint alleges that he sold approximately $8 billion in certificates of deposit by promising investors "improbable, if not impossible, returns."
The claim also accuses Stanford of:
Creating "a complex web" of companies that operated with little outside oversight.
Promising investors their money would be kept in liquid assets--basically cash or assets that can quickly be converted to cash--while actually investing most of the money in private companies and real estate.
Assuring investors that their money was safe from Bernard Madoff's highly publicized $50 billion alleged Ponzi scheme when, in fact, some of Stanford's holdings were invested through Madoff's firm.
"We are alleging a fraud of shocking magnitude that has spread its tentacles throughout the world," said Rose Romero, regional director of the SEC's Fort Worth, Texas, office.
The fallout from the fraud case is already rattling around the global financial system.
Venezuela on Thursday seized a failed bank controlled by Stanford after a run on deposits there, while clients were prevented from withdrawing their money from Stanford International Bank and its affiliates in a half-dozen other countries.
A federal judge appointed a receiver to identify and protect Stanford's assets worldwide, including about $8 billion managed by the Antigua-based Stanford International Bank, which has affiliates in Mexico, Panama, Colombia, Ecuador, Peru and Venezuela.
Also frozen were assets of Houston-based Stanford Capital Management and Stanford Group Co., which has 29 brokerage offices around the U.S.
In September, Forbes magazine named Stanford No. 205 in its "400 Richest Americans" article, estimating his net worth at $2.2 billion.
According to that article, Stanford lives on a 160-acre, 14-bedroom estate in the U.S. Virgin Islands, and he owns other homes, a yacht and several planes.
Stanford is a larger-than-life figure in the Caribbean, using his personal fortune to bankroll public works and cricket tournaments.