The news that the Bush/Mukasey Dept. of Justice delayed its investigation of "Sir" Allen Stanford from July to December 2008 -- until right after the Madoff scandal made any further delay look dangerous -- comes in today's Financial Times: DoJ accused of delaying Stanford probe:
The US Department of Justice delayed a Securities and Exchange Commission investigation into the affairs of alleged fraudster Sir Allen Stanford by at least five months, a report by the inspector-general of the SEC has found.
The delay, from July to December 2008, followed a three-year SEC probe. It culminated in the SEC filing fraud charges in February 2009, and then a criminal indictment in June. Sir Allen has pleaded not guilty and is in jail awaiting trial.
The revelation of why DOJ finally acted comes later in the article:
The SEC then alerted the DoJ, which opened its own investigation and asked the SEC "to not pursue any investigative action . . . while it considered how to launch its own investigation of possible wire fraud and/or money laundering", the inspector-general’s office wrote. By July 2008 the SEC had backed off, but resumed work in December 2008 after the arrest of Bernard Madoff. SEC staff felt "an increased sense of urgency", the report said.
They then contacted the FBI, which was conducting an investigation of its own. According to the report, although this "was in the preliminary stages", the FBI asked the SEC to continue to wait, but the DoJ told the SEC to go ahead, and the civil regulator filed its civil complaint against Sir Allen in February.
One must wonder how many additional people lost how much additional money as a result of the delay.
Meanwhile, we learned from Talking Points Memo Muckraker that Stanford isn't happy with his prison conditions. Stanford Complains: Prison Too Prison-Like:
Allen Stanford, the Texas banker charged with orchestrating an $8 billion fraud, isn't too happy behind bars, it seems.
His attorney, the heavy-hitting criminal defense lawyer Dick DeGuerin, has filed papers calling conditions at the federal detention facility north of Houston where Stanford is being held "oppressive," and asking that the cricket-loving billionaire be moved.
And we learn from Bloomberg that Stanford's court-appointed receiver is seeking a clawback of funds that went to people who profited from Stanford's schemes. Stanford Receiver Seeks Clawback of $925 Million From Investors:
Stanford International Bank Ltd.’s court-appointed receiver said he’s seeking to recoup $925 million tied to certificates of deposit issued by R. Allen Stanford’s Antigua-based bank.
The receiver, Ralph Janvey, yesterday expanded a complaint first filed in April in federal court in Dallas to recover money from Stanford customers as well as brokers who allegedly profited from a $7 billion fraud.