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Latest update : 2009-02-20

Texas financier Allen Stanford, accused of a global, multibillion dollar fraud that involved banks in the Caribbean and Latin America, has been tracked down in Virginia, USA, according to the FBI.

AFP - Texas financier Allen Stanford, accused of a multibillion dollar fraud that prompted governments to shut down his banks and seize their assets, was located Thursday in Virginia, the FBI said.

But the man accused two days ago by securities regulators of perpetrating "a fraud of shocking magnitude that has spread its tentacles throughout the world," and whose whereabouts until now were unknown, was not arrested.

"The agents served Mr. Stanford with court orders related to the SEC (Securities and Exchange Commission) civil filing against the Stanford Financial Group," FBI spokesman Richard Kolko said in a statement.

A US judge has frozen the assets of Stanford, his banks and two top executives and investigators are working to track down and seize assets overseas.

That could be complicated by the actions of other governments who have shut down -- and in the case of Venezuela seized -- his banks, said SEC spokesman John Nester.

"In any investigation involving multiple jurisdictions, there are complications that arise," Nester told AFP.

In the Caribbean and Latin America, authorities sought to quell fears among depositors who formed long queues outside local branches.

Five Latin American countries have already taken action against companies owned by Stanford, 58, whose wealth management and financial services group was particularly successful in Latin America and the Caribbean, where it lured investors with promises of big returns that never materialized.

Stanford Investment Bank claims to serve 50,000 clients in more than 130 countries while the umbrella Stanford Financial Group has more than 50 billion dollars "under advisement," according to the SEC complaint.

Faced with a run on a local subsidiary by panicked Venezuelans, Caracas "made a decision to intervene and to immediately sell" financial companies owned by Stanford, Finance Minister Ali Rodriguez said Thursday.

Stanford Bank Venezuela, which has 15 branches in the country, already has received offers from interested parties, he said.

Peru's securities regulator on Thursday suspended operations for 30 days at the local office of Stanford Financial Group, promising it was working to secure investors' funds.

In Panama, banking authorities took over "administrative control" of a local Stanford branch after nervous clients made massive withdrawals of deposits on Wednesday.

Ecuador suspended a Stanford affiliate from operating in the Quito stock exchange for 30 days or until the company resolves the claims.

The Stanford affiliate in Colombia agreed on Wednesday to suspend its activities on the Bogota stock exchange. Banking authorities said they had taken steps to "protect customers and investors in the entity and to preserve confidence in the stock market."

On the tax haven island of Antigua, hundreds of people queued up Wednesday at the Stanford-owned Bank of Antigua to withdraw funds despite authorities' assurances their accounts were not in danger.

For the past two decades, Stanford has been based in the Caribbean, where he built a reputation as a cricket patron.

Stanford allegedly ran the most high-profile fraud since Wall Street financier Bernard Madoff was charged in a 50-billion-dollar Ponzi scheme in December.

The scandal has caused huge embarrassment in English cricket with the bosses of the national association facing calls to resign after they signed a now unraveling deal with Stanford to stage matches in Antigua and England.

Stanford was behind the Stanford Super Series Twenty20 competition, which culminated in November 2008 with his team of hand-picked Caribbean Superstars defeating England in a match which netted every player on the winning side a million dollars each.


Date created : 2009-02-20