COLUMN:Stanford fraud hurts more than pocketbook

The Stanford Financial saga continues. It’s been interesting and I’ve dropped everything several times in the past two weeks to read and post breaking news on Biz Buzz about the SEC’s fraud allegations against R. Allen Stanford, Jim Davis and Laura Pendergest-Holt. But there is also a big chunk of heartache and agony involved.
We’ve talked about the investor agony. In Mississippi alone, the Secretary of State’s office says 4,524 Mississippians have accounts with Stanford, with assets of almost $391 million.
As of Friday, much of the money was still frozen by the court-appointed receiver, leaving a lot of investors in the lurch.
But what we haven’t talked about are the Stanford employees. The point was driven home to me during a discussion I had with a friend about Stanford’s situation.
She was quick to say that while the public is harping on the company for allegedly taking money from investors, not everyone in the company is at fault. Three people – Stanford, Davis and Pendergest-Holt – have been implicated.
Yet, the other employees are being hurt by their association with Stanford. As of Friday, Stanford’s office in Fairpark was still closed. I don’t have any idea if employees are getting paid, but I would bet more than a few are looking for other jobs.
It’s a job hunt that won’t be easy. Unemployment is near a record high. There are more workers than jobs. And, as my friend told me, the Stanford workers will have an extra hurdle to jump – the perceived taint on their work history because of their involvement with the now fallen Stanford Financial Group.
She’s speaking from personal experience. She previously worked for a company that was mired in controversy a few years ago. She said she didn’t hold any position of power and had nothing to do with the scandal.
Yet she found herself looking for a job. And she had to keep explaining her innocence to potential employers.
It’s a situation that dampens my excited curiosity into the Stanford case because I know people who work in Stanford’s Fairpark office. I’ve talked with them at Fairpark neighborhood meetings, interviewed them for financial stories, networked with them at Downtown Tupelo Main Street Association events and run into them at downtown restaurants.
They are real people who are hurt by something, we assume, they had nothing to do with. This was especially evident the day the charges were brought against the Stanford execs and the SEC with the help of the U.S. Marshals seized control of the Fairpark office.
I stopped by the office around 12:15 p.m. that day. As I talked with the SEC officials, I could see a usually effervescent Stanford employee I’d previously met. She looked like she was doing all she possibly could to not break down in tears. From her red eyes, it looked like she had lost the battle.
It’s a sobering thought. But don’t get me wrong. If I were a Stanford investor, I would be ticked off enough to show the temper usually associated with redheads. People could be out of a lot of money. Trust has been broken.
And now, it looks like more jobs are going to be lost.
Contact Carlie Kollath at (662) 678-1598 or carlie.kollath@djournal.com.

 

Carlie Kollath/Daily Journal