From: Reuters News
January 1, 2021
Switzerland will return $150m from blocked Swiss bank accounts by the end of the year to the United States to be given to victims of convicted Ponzi scheme con artist Robert Allen Stanford, the Federal Ministry of Justice said on Monday.
Stanford, a former Texas financier known primarily by his middle name, was convicted of fraud by a Houston jury in 2012 in what prosecutors called a $7.2bn fraud that lasted two decades and which was eclipsed in size only by the Ponzi scheme run by Bernie Madoff.
About $50m had previously been returned, the justice ministry said.
In October, the Swiss criminal court had rejected appeals against the seizure of the assets, paving the way for the remaining $150m to be returned by the end of December, the ministry said.
Stanford, now serving a 110-year prison term, had stashed millions from his Antigua-based Stanford International Bank at the Swiss arm of French bank Societe Generale, which he tapped regularly to fund a fleet of private jets and a 100-foot yacht, according to U.S. District Court filings from 2012.
“The release (of the blocked funds) became possible after the American financier Allen Stanford’s fraud conviction became permanent,” the Swiss justice ministry said in a statement on Monday.
According to a 2012 sentencing memorandum, U.S. federal prosecutors said Stanford was a “ruthless predator” who routed $116m in … proceeds “through a Swiss slush fund he controlled at Societe Generale”.
Societe Generale spent years fighting allegations that it had not adequately upheld its anti-money laundering obligations in accepting Stanford’s money, Swiss court filings show.
A bank spokesman contacted by Reuters declined to comment on Monday.
Background notes:
Robert Allen Stanford, who goes by Allen Stanford, is an American/Antiguan former banker that was convicted in 2012 of a Ponzi scheme following an investigation for securities fraud in excess of $7bn. It was revealed that Allen Stanford had grossly misinformed his 50,000 investors about the level of professional management that they were receiving. Allen and his associates were also suspected of possible dealings with Mexican drug cartels.
Allen Stanford was convicted of selling $7bn in fraudulent certificates of deposit (CDs) from his offshore bank, Stanford International Bank, on the island of Antigua in an international Ponzi scheme, a case that drew comparisons to disgraced broker Bernie Madoff’s multibillion-dollar fraud. Stanford’s fraudulent scheme is the second-largest in history, only behind Madoff’s.
Approximately 18,000 of his customers have not yet recovered their money, whereas a significant amount of Madoff’s previous clients have. Stanford was first charged in 2009 by the Securities and Exchange Commission (SEC) and in 2012 was eventually convicted.
Once a billionaire and one of the richest men in America, Allen Stanford received a 110-year prison sentence in a 2012 ruling and has faced further indictments from the SEC in the United States. He has reportedly been attacked while serving his jail sentence and has consistently claimed that he is innocent and has been framed. He says that he is a scapegoat of the SEC after their mishandling of Madoff’s case during the 2008 financial crisis.