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You are here: Home / Politics / Domestic Politics / Another Madoff

Another Madoff

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Stopping what it called a “massive ongoing fraud,” the Securities and Exchange Commission on Tuesday accused Robert Allen Stanford, the chief of the Stanford Financial Group, of fraud in the sale of about $8 billion of high-yielding certificates of deposit held in the firm’s bank in Antigua. Also named in the suit were two other executives and some affiliates of the financial group.

In the complaint, filed in Federal District Court in Dallas, the S.E.C. accused Mr. Stanford and two associates — James M. Davis, a director and chief financial officer of Stanford Group and the Antigua-based bank affiliate, and Laura Pendergest-Holt, the chief investment officer of both organizations — with misrepresenting the safety and liquidity of the uninsured CDs.

Also, last night, someone forwarded me a link a breathless piece about “FX dislocation” or something of the other that sounded very ominous and foreboding, and I honestly had no idea what to make of it, so I won’t even bother linking it now because I think it is irresponsible to fearmonger in these uncertain times, but there sure seems to be a lot going on out there right now.

Also, the DOW is down a couple hundred today, and I have no idea what is driving that, although if I had to guess it would be the auto industry stuff.

Reader Interactions

33Comments

  1. 1.

    Michael D.

    DOW is down a couple hundred today, and I have no idea what is driving that, although if I had to guess it would be the auto industry stuff.

    No. It’s just the start of the 5th week of the Failed Obama Administration™

  2. 2.

    Dave

    Stanford’s scam is particularly bad because he used CDs as the vehicle. Those are usually safe investments at responsible banks. Hopefully too many people won’t freak out just because this douche used them to rip people off.

  3. 3.

    The Populist

    Can we just try these people and put them on the firing line?

    Greed, the Republican mantra, at work yet again.

  4. 4.

    tomboy

    There was some crazy stuff going on with eastern european currencies this morning before the market opened, and there are some technical levels that were broken on the DJIA and the SP500. Oil is also being crushed. GM and Ford have little to do with it.

    I would also say that rumors of more Ponzi schemes and hedge fund liquidations haven’t helped.

  6. 6.

    TenguPhule

    Also, the DOW is down a couple hundred today, and I have no idea what is driving that, although if I had to guess it would be the auto industry stuff.

    More like Japan’s GDP crashing at a 12% annualized rate.

  7. 7.

    MattF

    Mr. Market has finally realized that all of the increase in the DJI during the last four years of the Bush administration is going to go bye-bye.

  8. 8.

    Libby

    No one could have predicted if you let an industry that handles trillions of dollar in assets police itself, that greedy individuals would cheat.

    On a related note, here’s a link I never got around to blogging. Remember that guy who got arrested for disclosing a bunch of secret Swiss bank accounts? He’s disclosing Cayman tax shelters now.

    The whistleblower’s documents have been seen by the Guardian. They record the names and transactions of hundreds of companies, trusts, funds and wealthy individuals – information protected by local and Swiss secrecy laws.

  10. 10.

    TenguPhule

    They record the names and transactions of hundreds of companies, trusts, funds and wealthy individuals – information protected by local and Swiss secrecy laws.

    Time to bring back indentured servitude and asset confiscation.

  12. 12.

    Punchy

    Yes, but remember, just this morning Rove insisted that the R party was THE party of regulation and oversight. With a straight face. And nobody on the set called bulshit. So it MUST be true.

  13. 13.

    MikeJ

    Didja google that term "fx dislocation"? Page after page of results from kooks saying, "RED ALERT fx dislocation in process!" The only results that don’t look like /b/tards tricked a stupid person are medical links about bone trauma.

    What’s really funny is that putting google into timeline view, you see the same hed on articles in 2006. In process, not progress, red alreat, everything all caps. Someone has been fear mongering for quite a while now.

  16. 16.

    Michael D.

    @Common Sense: I didn’t know that. Neither here nor there. But proof that there is a lof of corruption to go around. I’m just saying it is usually an individual thing and has very little to do with party affiliation.

    Stupid policies = Party affiliation, usually.
    Corruption = non-partisan.

  17. 17.

    woody

    Stanford’s scam is particularly bad because he used CDs as the vehicle. Those are usually safe investments at responsible banks. Hopefully too many people won’t freak out just because this douche used them to rip people off.

    It is in the nature of the system that there should always be some thieving douche in a position to screw the pooch for ‘the rest of us.’
    If the Rightards are correct about the deterrent power of capital punishment, if there were a very public video of Stanford kneeling in his skivvies in front of the hole he just dug for himself, awaiting the bullet in the back of the skull, might have a salutary effect.

  18. 18.

    The Moar You Know

    If the Rightards are correct about the deterrent power of capital punishment, if there were a very public video of Stanford kneeling in his skivvies in front of the hole he just dug for himself, awaiting the bullet in the back of the skull, might have a salutary effect.

    I’m against the death penalty but am willing to give this a try to see if it works. I might just change my mind if it did.

  19. 19.

    The Populist

    There are many more donations from him listed there. All to Democrats. Don’t always assume.

    Okay…nobody is assuming since the comment was directed at the idea that regulation is evil.

    If the guy is a Dem I could care less. I do care he defrauded people and the SEC (under Chairman Cox, A REPUBLICAN) seemed not to give two shits about any of these folks regardless of their party affiliation.

  20. 20.

    The Populist

    Corruption = non-partisan.

    Now you and I agree 100% on this. Fair enough, Michael. Keep in mind that I am a registered independent. I have no dog in either party’s fight (even if I do lean Dem for reasons that are obvious).

  22. 22.

    Montysano (All Hail Marx & Lennon)

    @chopper:

    japan’s falling apart and the NY fed report on manufacturing is brutal. bad day for stocks.

    Also:Via Denninger, the Russian exchanges had to be shut down this morning.

    Denninger also talks about the "FX dislocation", but it reached a level where my eyes glazed over.

    We’re all Tom Joad now.

  23. 23.

    The Populist

    If the Rightards are correct about the deterrent power of capital punishment, if there were a very public video of Stanford kneeling in his skivvies in front of the hole he just dug for himself, awaiting the bullet in the back of the skull, might have a salutary effect.

    Yep…how many people has Texas executed for crimes? So why is it that taking a little old lady’s life savings is any less worse than murder?

    I hate the death penalty unless it’s used ONLY for the heinous asses of society (and you prove it without a question of doubt). These fucks like Madoff should be strung up and if not executed, they should be humiliated.

    To me, when you mess with people’s savings and make promises you can’t keep and LOSE it all, you are scum. For some, it’s almost like being murdered because, unfortunately, to "live" one must be able to pay for things.

  24. 24.

    The Populist

    Oh, and FWIW, I am a registered Canadian.

    Hehe, that’s cool :) I maybe a bit of a curmudgeon but I try to be fair. For example, Sen. Burriss is a scumbag. He’s no better than Tom DeLay in my eyes.

    For me it’s holding the asses of society’s feet to the fire.

  25. 25.

    TenguPhule

    And nobody on the set called bulshit kicked him in the junk and took a flaming dump over his mouth. So it MUST be true.

    Fixed.

    In a just world, Rove’s kneecaps would have been buried in a swamp in Florida by now.

  27. 27.

    wilfred

    8 billion? Chump change. Wait till the Mother of all Madoffs gets audited:

    Federal authorities examining the early, chaotic days of the $125 billion American-led effort to rebuild Iraq have significantly broadened their inquiry to include senior American military officers who oversaw the program, according to interviews with senior government officials and court documents

    Remember the 12 billion that simply disappeared?

  28. 28.

    Glocksman

    @Michael D.:

    Actually he’s a bipartisan greedhead.
    On the next page it lists contributions to ‘Big John’ Cornyn and $28,500 to the NRCC.

    Do an all cycle search under both ‘Allen Stanford’ and ‘R Allen Stanford’, and it looks as if he’s merely trying to buy influence with both parties (specifically with Congressmen and Senators on financial panels and party leaders) instead of being a partisan Democrat or Republican.

  32. 32.

    Church Lady

    Stanford opened an office in Memphis four or five years ago. They are the current sponsor of the PGA tournament here that supports St. Jude Childrens Research Hospital, having taken over from Fedex in 2007, and have actively supported quite a few local non-profits, including one that I’m involved in. The tournament announced tonight that Stanford is no longer the sponsor. This is a tournament that raises around a million dollars a year for the hospital. Watching the news tonight, I was surprised to find out that Davis and Pendergest-Holt are in the Memphis office. Pendergest-Holt is on the Board of Directors of Youth Villages, a non-profit serving underpriviledged children in the community. It was announced that she has been suspended from the Board.

  33. 33.

    Ralph

    Ponzi, Madoff and Stanford all had something in common: (I) they offered deals and high returns that were seemingly too good to be true and they all "looked the part" of a businessman. Corporate swindlers knew that in the corporate world, "image" and "executive presence" will get you further than integrity and intelligence. That is why additional regulatory oversight will not detect them because the regulators hired to detect them also rose through the ranks based on image. To learn more go to http://www.newyorkshockexchange.com

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