COViSAL
For Justice & Restitution
____________________________________________________
Six years and three months have passed since Stanford’s debacle
destroyed the lives of 21,739 innocent families around the world when on
February 17, 2009, the U.S. Securities and Exchange Commission (“SEC”) abruptly
seized Stanford Financial Group in the United States.
The largest group is Latin American families with 15,270 victims
representing 70% of the total depositors in the Stanford International Bank,
Ltd. (“SIBL”) and more than $4 billion in losses. Depositors from the United
States are the second largest group. These families entrusted their savings to
a company belonging to an American conglomerate regulated and supervised by the
U.S. Government.
The majority of Stanford’s depositors are modest people; many
are elderly, ill, close to retirement, or families with special needs children. All are unable to pay for their critical
medical treatments and living expenses. A great number continue to die while
waiting in vain for even a small portion of their savings to be returned in
time for life-saving operations, or treatment of cancer, and other
life-threatening diseases.
The reality is that injustice continues for these victims as
the U.S. Receiver for the Stanford Financial Group and the Joint Liquidators
for SIBL in Antigua insatiably persist in generating fees and expenses for
themselves, their attorneys, and other professionals, the sole beneficiaries so
far, charging millions of dollars.
The U.S. Receiver, Ralph Janvey has “recovered”
approximately $240.9 million as of December 31, 2013, and spent more than
$127.5 million in fees and expenses. Mr. Janvey’s accomplishments in the recollection
of assets for the depositor’s distribution fund have been lacking. According to
Examiner John Little, “The Receiver and his professionals have not identified
any significant Stanford assets or accounts that were not identified in the
earliest days of the Receivership.” In contrast, Irving Picard, the trustee
unwinding Bernard Madoff’s fraud has recovered more than $10.6 billion for
victims. That is 60% of the $17 billion in principal lost by thousands of
investors in Madoff’s investment advisory business.
We request that the US Receiver and the Stanford Investors Committee show us the real picture of all the litigation claims brought to the Court. What is the actual potential amount of recovery of all the domestic litigation listed in the joint report? What law suits are moving forward and which are not? What about any international litigation and the amounts sought for recovery? If the best chances that affected families have of a meaningful recovery are the law suits against the largest corporations that benefited from Stanford, why are the Receiver, his attorneys and the Official Stanford Investors Committee’s attorneys reaching settlements for pennies?
Who are the real beneficiaries of the settlement agreement
between the U.S. Receiver and the Joint Liquidators? Who are the beneficiaries
of the recent lawsuit settlements?
According to the Joint Liquidators’ statement on the SIB
Liquidation’s website, they were named on May 12, 2011, and their mission is
“to recover $7 billion in losses stemming from the alleged R. Allen Stanford
multi-billion dollar Ponzi scheme and return the money to approximately 22,000
creditors in the shortest time possible.” However, it seems that the only
beneficiaries are Mr. Wide, Mr. Dickson and their colleagues, who are receiving
millions of dollars in fees and expenses, lining their own pockets at an
alarming rate. The Joint Liquidators fifth
report filed with the Court shows that they have received $8.2 million in fees
and expenses so far; their lead counsel $11.6 million, other legal advisers $14
million, $5.6 million was spent for other operational expenses, and $2.2
million was given in loans to Stanford affiliates. Last year, the JLs announced
the distribution of $34.6 million, equivalent to 1%, of which they have
distributed $6.9 million, and withheld $25 million from innocent victims
accused of receiving preferential payments.
We have not seen any meaningful efforts towards a real
recovery for the victims; the Joint Liquidators are just using the money
confiscated in England and Switzerland to pay themselves and their colleagues,
while forcing victims through a gauntlet for a pittance. However, their latest
accomplishment is an attempt to claw back funds from innocent victims who are “Net
Losers” by sending a very damaging letter asking for the return of money
withdrawn from their accounts during the six months prior to the collapse of
SIBL. It is important to emphasize that the withdrawals made by the majority of
these depositors during the six months prior to the closing of SIBL’s
operations were not “preference” payments as alleged, but legitimate
withdrawals of part of the principal invested by the rightful owners of the
money which they deposited and withdrew at the bank during the ordinary course
of business. The Joint Liquidators' insistence on pursuing claw backs against
innocent investors with as low as $1,200 in withdrawals is supported by neither
logic nor law.
What honest and transparent legal entity is providing
oversight of the receivership and liquidation processes? Where are the checks
and balances?
We exhort the Official Stanford Investors Committee, which
represents all Stanford investors’ interests worldwide, to voice our outcry and
concerns expressed in this letter to the Courts and other authorities
responsible for the Stanford Case. You have a fiduciary duty to the Stanford’s
victims, and your decisions and actions must be carried out in consideration of
the best interests of the victims. It is time that the victims of this atrocity
are taken into account.
It is unacceptable that the Courts in the United States and
Antigua have allowed the U.S. Receiver and the Joint Liquidators, named to conserve,
hold, manage, and prevent the waste and squandering of the creditors'
patrimony, and return the money to the innocent families, to continue
prolonging the recovery of assets for so long, and allow meager settlements generating
endless unreasonable billable hours and expenses, to the detriment of
Stanford’s depositors.
We ask for clarity, transparency, integrity and fairness,
and an end to a self-serving economic interest that irrationally pursues
control over the assets, wasting what is recovered of our patrimony. Control of
the money cannot be the driving force to bring justice and equity to thousands
of innocent families left in poverty and desperation.
We demand that U.S. and Antiguan Courts show the world, with
concrete and immediate actions, their commitment to honesty, equality and
justice. Innocent families in the US,
Latin America, and around the world, have the right to a full restitution of
their savings.
In God we trust that the rights of the victims will prevail
over judicial manipulations, and that good conscience will be the instrument to
impart justice, and to stop a never-ending fraud.
Jaime Escalona
On behalf of COViSAL
For Justice and
Restitution