By Patsy R. Brumfield/NEMS Daily Journal
Four former Stanford executives are accused of facilitating the sale of bogus investments through a $7.2 billion Ponzi scheme.
Friday, the U.S. Securities and Exchange Commission issued two administrative orders citing Jay Comeaux, Danny Bogar, Jason Green and Bernerd Young with willfully aiding and abetting the fraud.
They were top officials at Stanford Group Co., the broker-dealer investment organization for failed financier R. Allen Stanford’s Houston, Texas-based empire.
The Stanford world collapsed in early 2009 under the weight of an SEC investigation into certificate of deposit sales through Antigua-based Stanford International Bank Ltd.
Comeaux, the brokerage’s president from 1996-2005, settled the SEC claims without admitting or denying their truth and agreed to be barred from the broker-investment industry. Any financial penalties will be determined by an administrative law judge.
Comeaux, 64, lives in Houston.
Bogar, Green and Young say they will fight the SEC’s claims.
Bogar succeeded Comeaux. Green was chief of Stanford’s private client group and Young was a former regulator who became chief compliance officer.
SEC records show that Bogar, 53, is unemployed and living in Florida. Young, 53, is CEO of a Texas securities-consulting company. Green, 49, is unemployed and lives in Baton Rouge, La.
Stanford, 62, was found guilty last March of using the brokerage to sell phoney CDs over about 20 years. A federal judge sentenced him to 110 years in prison.
Bogar is brother-in-law to ex-Stanford CFO James Davis, who lived in Union County and worked out of Tupelo and Memphis offices. Davis pleaded guilty to his part in the scheme and faces up to 30 years in prison.
Co-defendant Laura Pendergest-Holt, a Baldwyn native, pleaded guilty recently to obstruction of the SEC investigation. The former Stanford chief investment officer is set for sentencing in Houston on Sept. 13.
Two other ex-Stanford executives accused in the scheme are due for trial in Houston.
For more than two years, the SEC has been reviewing the brokerage’s role amid criticism from investors and lawmakers who said regulators should’ve caught the fraud sooner. The SEC’s internal watchdog faulted the agency in a report, saying no meaningful probe of Stanford’s businesses was conducted until 2005, even though examiners suspected fraud eight years earlier.
The SEC claims that Bogar, Young and Green took trips to Antigua and failed to investigate and perform due diligence on Stanford’s bank.
They also are accused of providing brokers with sales documents they knew to be false, including that depositors were protected by insurance.