By Daily Journal Reports
DALLAS – A Stanford Financial Group victims’ advocate lambasted plans to distribute roughly 1 cent for every dollar lost in the $7.2 billion Ponzi scheme.
“To say the recovery of one penny on the dollar is disappointing is a dramatic overstatement,” said Angela Shaw, the director and founder of the Stanford Victims Coalition. “The reality that $2 dollars have been spent to recover each dollar that will be distributed is astonishing, and we can only hope this is the first step in recovering more of our savings rather than the final chapter of an inconceivable four-year nightmare.”
Shaw’s family lost millions in the scheme after the Stanford empire collapsed in early 2009.
Friday, the court appointed receiver presented a plan for an “initial payment” of $55 million for victims’ claims.
Defunct company chief R. Allen Stanford and three other executives are serving prison sentences for their part in the scam that sold worthless certificates of deposit through Stanford International Bank Ltd., based in the Caribbean.
His chief financial officer, former Union County resident James M. Davis, faces sentencing Jan. 22. He said he hopes his cooperation with the government will yield leniency from the presiding judge.
Stanford is serving a 110-year sentence.
Shaw said the fees involved in collecting the lost money far outweighed the payout.
After a civil action by the U.S. Securities and Exchange Commission, a Texas-based federal judge appointed a receiver to settle the Stanford estate and disburse any assets to claimants.
Separately, the SEC requested that an industry backed fund, the Securities Investor Protection Corp., start a court proceeding that could help further compensate victims.
But a U.S. judge turned down the SEC’s request, saying the agency had not met its legal burden to show why SIPC should be compelled to act. SIPC, which has handled high-profile liquidations such as Bernard Madoff’s Ponzi scheme, contended that Stanford’s offshore bank fell outside the scope of its authority.
The SEC has appealed.