Rep. Bill Cassidy, R-Baton Rouge, is asking Securities and Exchange Commission Chair Mary Jo White to appeal a D.C. Court of Appeals ruling that victims of the Stanford Ponzi scheme aren’t eligible for compensation from a fund established by the Securities Investor Protection Corp.
The court ruled that the losses, painful as they were, came from foreign certificates of deposit issued by banks that aren’t part of the corporation’s industry members who fund the account to reimburse victims of financial fraud.
In 2012, Allan Stanford, the former board of directors chairman of Stanford International Bank (SIB), was sentenced to 110 years in prison for what the federal government said was orchestrating a 20-year investment fraud scheme in which he misappropriated $7 billion to finance his personal businesses. Many of the victimized investors are from Baton Rouge and Lafayette.
The SEC had urged the Investor Protection Corporation to reimburse Stanford victims for some of their losses. The corporation refused, and an appeals court found that it had valid reasons to reject the payouts.
“Stanford Victims’ financial futures have been damaged by the Ponzi scheme, and now threatened by SEC inaction,” said Cassidy, a candidate for the U.S. Senate. “Since similar cases have ruled in victims’ favors, I urge the SEC to appeal the U.S. Court of Appeals ruling. The Stanford Ponzi Scheme devastated many Louisiana families, we must do all we can to help these families achieve justice.”
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For a full and open debate on the Stanford receivership visit the Stanford International Victims Group – SIVG official Forum http://sivg.org.ag/