Exec threatened to report bank deals if Stanford didn’t (threatened to whistleblow)

[Robbien]

Source: Houston Chronicle

Four days before Stanford Financial Group’s assets were seized, a top executive warned Chairman R. Allen Stanford that he should tell U.S. regulators about deals he was making with an offshore bank at the center of a fraud case, and that recent deposits should be returned to investors.

In a Feb. 13 e-mail to Stanford, copied to Chief Financial Officer James Davis and other executives, Chief Compliance Officer Lena Stinson said that if the company did not formally report the deals with the Stanford International Bank in Antigua and other issues, she would resign and report them to the Securities and Exchange Commission herself.

“The company should immediately disclose to the SEC that the bank’s financial statements must be revised to reflect related party transactions,” she said, referring to a $541 million capital infusion from Allen Stanford to the bank.

She also said the bank should stop accepting investor deposits and refund recently received payments, according to court documents filed today.

“Allen if this does not happen I will have no choice but to tender my resignation and report to the SEC the issues I believe exist,” Stinson said.

Read more: http://www.chron.com/disp/story.mpl/front/6306258.html

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And another employee started questioning transactions:

Today's filings also include a Feb. 4 e-mail to Davis from Stanford General Counsel Mauricio Alvarado. He expressed confusion about a meeting in Miami the previous day where it was revealed that Allen Stanford’s capital infusion into the bank from Stanford and $2 billion of the bank’s assets were made up of real estate projects the bank had acquired the year before for about $85 million.

“While I am not an accountant or a finance person, unless you were referring to other real estate holdings of which I do not know, I do not understand or see how it is possible that said acquisition could be considered capital contribution or be valued over 2 Billion when they were acquired to start with by SIBL for a much lower consideration,” Alvarado wrote. “There must be some mistake.”

[yourout]

1. Allen should end up in jail.

Stinson may need the witness protection program.

[bertman]

2. "There must be some mistake." Indeed.

The question I must ask is why did it take so long for someone in the group to recognize what was going on, and threaten to report it? Fear for their jobs? Fear for their lives?

[acmavm]

3. And Stanford is pleading the 5th. Madoff is going to jail and he's still not

told anyone anything that would lead to his partners in crime or the billions he bilked from his investors.

Lovely.

[Supersedeas]

4. the more the spotlight is put on them -- the more we realize how we've been duped