From a story on CNN:
A financial analyst who studied public documents about Stanford International Bank for a friend who was considering investing in it said Thursday that it took only a cursory look to determine something was wrong.
Public documents. A financial analyst saw something was wrong.
So why, do you suppose, that the federal agencies whose job it is to watch over our bank and financial institutions couldn't figure out before now that Stanford was running a scam?
And more:
Though the bank was audited, its auditor had not changed in a decade, he said.
And, as I understand from other sources, this is what finally tipped the Feds off: they requested more detail on the most recent audit from the auditor, and the auditor refused to provide it.
Oops. Bad move.
This also shows the problem with having regulators who are too closely tied to whether the financial institution continues to make a profit:
And local regulators in Antigua had little incentive to look closely at the bank's books, he added: "If the bank goes elsewhere, who is going to build schools and maintain the roads and gardens?"
One final interesting note:
And what about the stockholders? "There is only one," Dalmady said. "He has the title of chairman of the board and doesn't appear to have management responsibilities at the bank."
Amazing--nothing to raise suspicions here, though, according to the Feds.
The only good news at the moment:
Last Thursday, the FBI announced federal agents had located Stanford in Fredericksburg, Virginia, and served him with papers accusing him and three of his companies of fraud. He was not taken into custody, and no criminal charges were filed against him. Video Watch more about Allen Stanford »
A day later, Antiguan and Barbudan regulators took control of Stanford's financial institutions on the twin-island nation.
The chief investment officer of Stanford Financial Group was arrested Thursday on a criminal complaint that charged her with criminal obstruction, the Justice Department said.
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Laura Pendergest-Holt is to appear Friday before U.S. Magistrate Mary Milloy at the federal courthouse in Houston, Texas.
We can hope that justice will be served in this case, but I have to wonder how many more similar institutions haven't been found out yet.
Updated: link added, per request--sorry for missing that the first time.