A bipartisan group of 16 members of Congress is demanding answers from the Securities and Exchange Commission about its handling of the alleged Ponzi scheme at Stanford Financial.
The group, led by Louisiana Senators David Vitter and Mary Landrieu, and Lousiana Republican Congressman Bill Cassidy is demanding SEC Chairwoman Mary Schapiro release details about the agency's handling of the case, which has left some 28,000 investors penniless.
Among other things, they want more information about the court-appointed Receiver in the case, Ralph Janvey, who is overseeing the dismantling of the Stanford empire.
The letter reads:
Dear Chairwoman Schapiro,
We write to you on behalf of the thousands of American citizens who are entangled in the alleged fraud and deceptive practices of Allen Stanford and his various financial service companies.
We seek cooperation with your office to ensure justice for those who have been wronged, restore confidence in the regulatory authority of the United States, and protect others from future harm.
While the first public action taken by the SEC to address Mr. Stanford's conduct occurred in February 2009, the Complaint alleges a massive Ponzi scheme was underway within the Stanford organization for at least a decade.
Additionally, the SEC has investigated Mr. Stanford and his companies since 2005. Quicker and more thorough action by the SEC might have mitigated the losses of thousands of investors.
Thousands invested their entire life savings or a substantial portion of their savings in Stanford Certificates of Deposit (CDs). These investments are at risk and we request the SEC provide a plan for restitution for the CD holders and clarify the types of accounts the Receivership holds.
This includes accounts owned by individuals and held by third party firms, and CD accounts which are the foundation of the Complaint. We encourage you to devote time, focus, and resources to ensure the Stanford Receivership is efficient and effective.
Restoration of public confidence in regulatory institutions and trust that the investigation will be thorough, complete, and professional is imperative. To assist us and the thousands of impacted Stanford investors, we request the following:
- Release all internal memoranda and information received by the SEC discussing potential fraud by Allen Stanford and his associates within all Stanford-affiliated companies prior to the February 17, 2009 filing of charges.
- Implementation of a full, independent audit of all expenses incurred throughout the Stanford Receivership, including but not limited to legal fees, travel expenses, and other expenditures made by Ralph S. Janvey, the court appointed Stanford Receiver.
Additionally, we request an independent audit of all other organizations retained by the Receiver to carry out the Receivership duties. We want to stress the urgency of these matters.
Many individuals are suffering severe economic hardship as a result of these events. They deserve answers and solutions as quickly as possible. We want to thank you in advance for your cooperation and look forward to your quick response.
Rep. Bill Cassidy (R-LA) Sen. Arlen Specter (D-PA) Sen. David Vitter (R-LA) Sen. Mary Landrieu (D-LA) Rep. Charlie Melancon (D-LA) Rep. Charles Boustany (R-LA) Rep. John Fleming (R-LA) Rep. Rodney Alexander (R-LA) Rep. Ron Klein (D-FL) Rep. Steve Scalise (R-LA) Rep. Robert Wexler (D-FL) Rep. Anh “Joseph” Cao (R-LA) Rep. Pete Olson (R-TX) Rep. Allyson Schwartz (D-PA) Rep. Kenny Marchant (R-TX) Rep. Jo Bonner (R-AL) Rep. Travis Childers (D-MS)