Stanford case causes run on banks in Antigua

Reuters:

Hundreds of people lined up to withdraw money from banks in Antigua and Caracas affiliated with Texas billionaire Allen Stanford, a day after the tycoon was charged with an $8 billion fraud.

The whereabouts of the brash, 58-year-old financier were unknown. CNBC television said he tried to hire a private jet to fly from Houston, the site of his U.S. headquarters, to Antigua, but the jet lessor refused to accept his credit card.

The U.S. Securities and Exchange Commission has accused Stanford of operating a fraud centered on the sale of certificates of deposit from his Antiguan affiliate, Stanford International Bank Ltd (SIB).

The scheme has drawn comparisons with the alleged $50 billion fraud by Wall Street veteran Bernard Madoff.

In the twin-island state of Antigua and Barbuda, where Stanford is the biggest private employer, Prime Minister Baldwin Spencer said the charges against him could have "catastrophic" consequences but urged the public not to panic.

Two police officers stood watch at the Bank of Antigua as at least 600 people stood in a line stretching around a street corner, despite assurances from regional monetary authorities that the bank had sufficient reserves.

"I'm worried and I'd like to get my money out," said Andrea Lamar, 28, who joined the line with a friend on a street popular with tourists in the state capital, St. John's.

Bank of Antigua, with three branches in Antigua and Barbuda, is part of Stanford's sprawling global business interests but is separate from SIB, the offshore affiliate at the heart of fraud charges lodged by U.S. regulators.

The Eastern Caribbean Central Bank posted a statement at Bank of Antigua saying the bank had sufficient reserves.

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Obama knows the pain of having ones credit card refused, before the Bush economy made him a millionaire. Billionaire Stanford faces a different problem. It is very likely that there is an injunction against him spending his personal assets, because the SEC is likely to ask the court for a disgorgement award when its case against Stanford is tried. He is probably looking for liquid assets that have not been attached at this point. His lawyers may be interested in the same thing to insure they get paid.