Stanford investors want money back

Published: February 20, 2009

Investors with money in South American banks controlled by Stanford Financial Group are scrambling to get their deposits out of the bank, according to news agency reports.

FOX News reported late on Feb. 19 that Venezuela would take control of Stanford Bank SA and would back deposits after “massive withdrawals” by investors, according to Ali Rodriguez, the country’s finance minister.

Rodriguez said the Venezuela-based bank will be put up for sale and has already attracted interest from new buyers. He would not comment further.

Meanwhile, in Peru, the country’s security regulator suspended operations of its Stanford Financial office in Lima for 30 days after investors were lined up outside the office’s door to collect lost funds. The regulator, Conasev, said it was working to help the financial office’s client get their money.

Also that day, customers swarmed the Bank of Antigua and another bank controlled by Stanford in efforts to try and get their money back.

Earlier this week, the federal government brought fraud charges against company Chairman Sir Robert Allen Stanford, a Houston financier, and three of his companies for fraud surrounding high-interest-rate certificate of deposits. The U.S. Securities and Exchange Commission lawsuit alleges Stanford International Bank sold about $8 billion of so-called certificates of deposit to investors that promised upwards of double-digit returns.

U.S. District Judge Reed O’Connor entered a temporary restraining order and froze Stanford’s assets on Feb. 17.

The Federal Bureau of Investigations found Stanford in the Fredericksburg, Va. area Feb. 19, and served him with court papers related to the civil case filed in federal court in Dallas.

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