Payday loans won’t clear Stanford’s name
Allen Stanford
Billionaire Allen Stanford could find himself needing payday loans if his fortune is wiped away with the new revelation that Stanford is being charged with fraud.
The U.S. Securities and Exchange Commission says Stanford Financial Group fraudulently sold $8 billion in high-yield certificates of deposit. Stanford and two other top executives are being charged with fraud.
Ordered to the court
In the lawsuit the commission alleges that Stanford’s scheme stretched throughout the globe. Three of Stanford Financial Group’s companies are involved in the suit. There has been news recently of payday loans companies being involved in lawsuits recently, but they were nothing close to this magnitude.
The SEC was seeking to freeze the assets of the Stanford group and appoint a receiver “to take possession and control of defendants’ assets for the protection of defendants’ victims,” according to Reuters.
Whisked away
Fifteen federal agents descended on the company headquarters in Houston, Texas, to cart Stanford away. For the time being, financial operations are continuing at Stanford’s companies. However, a note on the door at the Houston headquarters said Standford Financial was “under the management of a receiver.”
Year of the scam
Stanford Financial claims to oversee $50 billion in funds.
Last year was filled with scams of all types. From Bernard Madoff’s $50 billion Ponzi scheme to individuals setting up fraudulent “work from home” companies, 2008 appeared to be the year of the scam. Now, only a few weeks in to 2009, it appears maybe the trend will continue. Many con artists have used the recession, mortgage crisis and credit crunch to prey on people. It is important to stay financially educated to avoid these scammers.
Personal Money Store’s Money Blog can help you in your quest for financial education with articles about payday loans, scams and other general financial news.
There will always be scam artists, but this is getting out of hand. I think we need to make examples out of Madoff and this guy. A message needs to be sent to the executive/business class that no matter what Ivy league school you went to, no matter how much money you’re in charge of, the rules apply.
wow!