ST. JOHN’S, Antigua – Antigua and Barbuda’s Attorney General Justin L. Simon, QC has issued a statement on the Sir Allen Stanford & Leroy King Matter:
The Government of Antigua & Barbuda has been reliably informed that the US Securities Exchange Commission had on Friday, June 19 2009 filed in the Northern District Court of Texas a Motion for Leave to file an Amended Complaint in its pending civil suit against Stanford International Bank Limited (SIB), Stanford Group Company, and R Allen Stanford among others. The civil suit was filed by the SEC in February 2009.
The Amended Complaint adds Leroy King, among others, as a defendant. Mr. King who is the Administrator (currently on suspension) of our Financial Services Regulatory Commission (FSRC) is therein alleged to have, among other things, facilitated the Stanford International Bank’s Ponzi Scheme “by ensuring that FSRC ‘looked the other way’, and conducted sham audits and examinations of SIB’s books and records in exchange for bribes paid to him over a period of several years”.
Attorney General Justin L. Simon, QC
The Government is naturally concerned over these serious allegations which suggest that Mr. King was engaging in unlawful activities for personal gain thereby compromising the due performance of his duties as an FSRC employee, given the strict regulatory standards established over the years by the Commission. Antigua and Barbuda’s offshore business activities is once again placed under intense international scrutiny, and this will clearly have adverse effects on the economy and raise questions about our regulatory legal framework. I wish to reassure the general public and the wider international community that the Commission’s Board has itself been engaged during the past several weeks in rigorous self?examination along with an internal investigation of Mr. King’s employment conduct.
The Government has confirmed that a number of criminal indictments have been laid against both R Allen Stanford and Leroy King which include conspiracy to commit mail fraud, conspiracy to commit wire fraud, conspiracy to launder illegal proceeds, and obstruction of the SEC. These charges do raise the issue of a possible extradition request by the United States authorities.
I can authoritatively state that following a meeting with Mr. King, the Commission yesterday penned a letter to the Hon. Minister of Finance making certain recommendations for Cabinet’s consideration as to Mr. King’s continued employment with the Commission. The International Business Corporations Act provides for the appointment of and disciplinary action against the Administrator of the Commission are to be done by Cabinet. This matter will be definitively addressed at the next Cabinet meeting held on Tuesday, June 23rd.
These events touching and concerning the operations of Stanford International Bank Limited which began in February 2009 has had an adverse effect on the economy with employees being laid off or dismissed without payment of severance, trade creditors remaining unpaid from as far back as November 2008, and the inability by the various Stanford entities to provide their accustomed services.
The Bank has been placed in liquidation in an effort to collect its various assets for distribution to depositors and creditors, but this will be a long legal process. Government’s acquisition of the lands of these entities has been challenged in the High Court, and attempts by the Registrar of Companies to assess the financial viabilities of the entities are also being challenged. But Government cannot and will not sit idly by, given its abiding duty and obligations to its citizens and all those adversely affected by these unfolding events.
Given the circumstances, we firmly believe that the compulsory acquisition of the lands, Government’s financial support of the Bank of Antigua, the liquidation of Stanford International Bank, and the action initiated by the Registrar of Companies are all in the best interest of the country.