Monday, February 23, 2009

Stanford Financial Sued by Charity

Stanford Financial Group Co. and its chairman, Houston billionaire R. Allen Stanford, were sued by a Colorado investor over claims the company’s alleged $8 billion fraud may have wiped out a charity’s investment.

Johan Dahler, the trustee for a Colorado-based charity benefiting poor people in Mexico and Central America, alleged Stanford employees engaged in fraud and conspiracy by lying about returns on investments at Antigua-based Stanford International Bank, according to a complaint filed Feb. 19 in state court in Harris County, Texas. The suit doesn’t specify money damages.

Stanford and two of his officers “knowingly and recklessly made false and material misrepresentations” about certificates of deposit, and failed “to state material facts which made their representations misleading,” claimed Dahler, who directed the investment of more than $772,000 from 2004 to 2007 for the Rocky Mountain Trust.

The U.S. Securities and Exchange Commission sued Stanford and three of his companies on Feb. 17, accusing the financier of running a “massive” fraud that touted “improbable, if not impossible” returns at the bank. No criminal charges have been filed against Stanford, who was found Feb. 19 by the FBI in the Fredericksburg, Virginia, area. He was served with a subpoena from the SEC.

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