US Stanford receiver lacks confidence in Antigua courts
TEXAS, United States, April 29, 2009 – The receiver appointed to Sir Allen Stanford’s companies in the United States (US) has told a court he has no confidence in the courts in Antigua and Barbuda to properly carry out the liquidation of Stanford International Bank Limited (SIBL), which is at the centre of the multi-billion dollar civil fraud charge laid against the Texan investor.
In a report on his work so far, filed in the US District Court for the Northern District of Texas, Ralph Janvey said the American court system should be allowed to deal with the matter.
On April 17th, the High Court in Antigua placed SIBL into liquidation and appointed Nigel Hamilton-Smith and Peter Wastell as liquidators. The two, Client Partners at the British firm Vantis Business Recovery Services, had also been appointed receivers by the court back in February after the US$8 billion fraud charge was laid against Sir Allen.
“The Antiguan liquidators essentially request that the US Court cede to the Antiguan court system control over the marshalling, liquidation, claims adjudication and distribution process. That, in the receiver’s view, would be unwise and detrimental to claimants, as the Antiguan court system lacks experience in the administration and winding up of a business of the size and scope of the Stanford family of companies,” Janvey said in his report.
“Further, the Antiguan liquidators have liquidation authority over only SIBL, which is just one of the more than 100 Stanford companies involved in what was an integral – and allegedly fraudulent – operation.”
Janvey has already indicated his intention to challenge the liquidation in Antigua and said he will also oppose the Antiguan receivers in court in the US and other jurisdictions where they are attempting to liquidate Stanford entities.
At the same time, he spoke of looking for opportunities in which cooperation with the Antiguan receivers is possible and reasonably likely to benefit the receivership estate.
The case against Sir Allen, three of his companies – SIBL, Stanford Trust Company and Stanford Capital Management – and two top executives surround the sale of US$8 billion in high yield certificates of deposit (CDs), sold through SIBL.
The Securities and Exchange Commission (SEC) in the US which laid the civil fraud charge against Sir Allen, claimed that it was a Ponzi scheme, in which earlier investors are paid from monies paid in by later investors, rather than from actually returns on their investments.
Janvey has insisted that although SIBL’s headquarters was in Antigua, all of its financial operations, including CD sales, were controlled and managed from Sir Allen’s offices in the US and he should therefore have control of its assets.