R. Allen Stanford convicted for Ponzi scheme
Robert Allen Stanford arrived for a bond hearing at a courthouse June 25, 2009 in Houston, Texas. He has now been convicted by a jury for fraud.
Jeremy Hobson: A Federal Jury in Texas has convicted Allen Stanford of defrauding investors to the tune of $7 billion in a Ponzi scheme. Stanford could face life behind bars, and prosecutors say they may only be able to find $300 million to pay back investors.
Marketplace's Mitchell Hartman reports.
Mitchell Hartman: The high-living Texas financier was convicted of using fraud to inflate the value of his Stanford International Bank.
The $7 billion fraud pales in comparison to Bernie Madoff’s $50 billion-plus scheme. But it’s still significant, says securities lawyer Tom Ajamie.
Tom Ajamie: This is huge. Any time you have a scam that’s a billion dollars-plus, that’s just a tremendous amount of money. And don’t forget here, he had at least 30,000 customers affected by this -- in many cases lost all of their money.
University of Houston law professor Adam Gershowitz says even with this high-profile conviction, fraud investigators have their work cut out for them.
Adam Gershowitz: If you’re a billionaire cavorting in the Caribbean, running an enormous Ponzi scheme, you’re probably a little more scared today than you were last week. Your average white-collar criminal is much more difficult to detect, engaged in much lower-level fraud or manipulation.
Stanford’s lawyers say he’ll appeal.
I’m Mitchell Hartman for Marketplace.