The Madoff affair seems to be a harbinger of more destruction. In Europe as well as the Caribbean, a Texan pirate-type, high-flying financier is being investigated by the SEC. Mr. Stanford might be up and up and not a crook but then, why is he hiding on one of Queen Elizabeth’s many little pirate islands? And how does he make non-stop double digit profits for investors while basically not doing anything we can really see? And we also visit some old Madoff news to see how he and his whole family wormed their way into positions of regulatory power.
– R. Allen Stanford, the billionaire chairman of Houston-based investment firm Stanford Group Co., blamed “former disgruntled employees” for stoking regulatory probes into his firm.
Stanford Group is under investigation by the U.S. Securities and Exchange Commission and the Financial Industry Regulatory Authority, according to people familiar with the matter who declined to be identified because they didn’t want to put their jobs at risk. The agencies are examining the company’s sales of certificates of deposit issued by its Antigua-based affiliate, Stanford International Bank Ltd., and the consistent, above- average returns those investments paid, the people said.
“We are all aware that former disgruntled employees have gone to the regulators questioning our work and our processes,” Stanford said yesterday in an e-mail to staff members that was obtained by Bloomberg News. “This could have compounded an otherwise routine examination.”
Investigators from Finra visited six Stanford Group offices last month, downloaded information from computer hard drives and looked through files, the people said….
The returns were between 10.3 percent and 15.1 percent every year from 1995 until last year, according to documents and annual reports on the bank’s Web site.
SIB has $8.5 billion in assets and 30,000 clients, according to the site.
Deposits climbed to $7.7 billion in July, from $3 billion at the end of 2004, according to press releases and the mid-year report posted on the site.
So, this pirate’s treasure chest saw funds nearly triple in just years, a $4.7 increase? Ah, they all wanted more than 10% a year in returns! When Madoff was arrested, a number of us who didn’t like pirates and gnomes all that much, were thinking, Madoff was not the end of the arrests of rip off artists but rather, the end of Act I in this Shakespearean play, ‘King Leer’, the sex-crazed financiers go bankrupt!
Oh, also: The company overseeing the firm’s books is “a tiny accounting firm in Antigua” whose CEO recently died. Oh, dear.
Ten gallon hat Stanford does one better than Madoff! His accountant is dead! HAHAHA. Can’t spill any beans! Madoff’s was merely retired. Both accounting firms seem to be tiny rooms in run down shopping strips with one nearly-blind old lady as the receptionist and some punk kid in the back room, pushing drugs in his spare time. This latest billionaire to be found wanting may be wanted…for arrest.
We shall see! Maybe he will have a lawyer contact me to tell me, he isn’t a crook. Like previous crooks who contact me, I probably won’t get a second letter due to them always ending up spending all their lawyer’s billing hours, trying to stay out of prison. Well, IF Mr. Stanford is breaking the law, I hope he is arrested. If his accountant can be roused via a seance, maybe we can find out how the books are balanced.
It’s the kind of quick, hard-edged response for which he is famous. A fifth-generation Texan, Stanford made his first fortune in Houston, snapping up distressed real estate in the early 1980s before inheriting the insurance and real estate-company his grandfather founded in 1932.
Forbes Magazine put his personal wealth at $2.2 billion last year and says his list of wealth-management clients includes pro golfer Vijay Singh. He credits his recent success in part to avoiding investments in subprime mortgages that snowballed into a global financial crisis….
For many years he lived in the twin-island Caribbean nation of Antigua and Barbuda where he is by far its largest private employer and investor. With dual U.S. and Antiguan-Barbudan citizenship, Stanford has homes sprinkled across the region — from Antigua to St. Croix in the U.S. Virgin Islands to Miami.
Knighted in 2006 by the Antiguan authorities rather than the Queen of England, he is known by islanders as simply “Sir Allen” — an ardent cricket enthusiast whose financial muscle has helped to rehabilitate West Indian cricket.
Reading this, my suspicious mind reels. He made his fortune in DISTRESSED real estate but escaped the sub prime mess? I doubt that. He sounds like a big-time ‘flipper.’ Let’s go visit his web page:
Stanford Financial Group Forms Stanford Institutional Consulting to Provide Asset Management Services to Individual and Institutional Investors
Stanford Financial Group – Baltimore, MD – December 17, 2008: Stanford Financial Group today announced the formation of Stanford Institutional Consulting, a new business group within its global network of financial services companies. Based in Baltimore, MD, Stanford Institutional Consulting (SIC) serves the needs of both high net worth clients and institutional clients spanning education, healthcare, foundations, endowments, associations, and retirement plans, with assets ranging in size from $10 million to over $1 billion.
So, he is a member of FINRA? HAHAHA. Someone else ran that organization! Let’s see who:
FINRA is the largest independent regulator for all securities firms doing business in the United States. We oversee nearly 5,000 brokerage firms, 172,000 branch offices and 663,000 registered securities representatives. Our chief role is to protect investors by maintaining the fairness of the U.S. capital markets.
NASD Board of Governors Appoints Four New Members to the National Adjudicatory Council; and Names New Council Chair and Vice Chair
Washington, D.C. — The National Association of Securities Dealers, Inc. (NASD®) Board of Governors today announced the appointment of four new members to the 2001 National Adjudicatory Council (NAC) during its December 2000 Board meeting. The Board also announced the NAC’s recent election of David A. DeMuro as Chair and Anthony B. Petrelli as Vice Chair of the Council, effective February 1, 2001. The NAC is a 14-person committee that meets regularly to decide appeals from disciplinary, membership, and exemption decisions; rule on statutory disqualification applications; and other policy matters. Council members serve two-year terms, and represent an equal mix of industry and non-industry members.
“The NAC plays a critical role in deciding disciplinary matters that set a standard for fairness within the securities industry,” said Mary L. Schapiro, President of NASD Regulation. [This is the infamous Mary Schapiro Obama chose to run the SEC!!!!] “Additionally, we rely on the NAC’s experience and perspective to help formulate effective membership policy. Dave and Tony will be excellent leaders of the NAC, and I welcome all new and returning members to the 2001 committee.”
DeMuro is Managing Director and head of Global Compliance and Regulation at Lehman Brothers, [Now a dead financial house!] where he has worked since 1984. Before that, he held various positions with the Securities and Exchange Commission. DeMuro is a member of the NASD Membership Committee and the CRD Industry/Regulatory Review Council, and is a member of the Executive Committee of the Securities Industry Association’s Compliance and Legal Division.
Petrelli is currently a Senior Vice President and Director of the Corporate Finance-Investment Banking Department of Neidiger, Tucker, Bruner, and is currently a member of the NAC, the NASD Corporate Finance Committee, and the NASD Small Firm Advisory Committee. He is a former member of the Board of Directors and former Chairman of the Regional Investment Bankers Association, and currently serves on the board of Vari-L Company, Inc.
The Board has appointed four new industry members to the 2001 NAC; three appointments represent geographic regions, and one has been appointed as the “at-large” member of the NAC. Former NASD District 10 Committee Chair Mark D. Madoff, Director of Listed Trading at Bernard L. Madoff, New York, New York, has been appointed to the NAC as an at-large industry member, following nomination by the NASD National Nominating Committee. The other three new members of the NAC, each nominated by a regional nominating committee and the NASD National Nominating Committee, are as follows:
HAHAHA! Madoff was an ‘at large’ industry member. FINRA should be disbanded because it looks more and more like a band of thieves rather than some industrial regulatory group. Below is a list of FINRA news stories with the Madoff names: FINRA Search Results: Madoff
… Howard Spindel Integrated Management Solutions New York, NY USA LLC Alternate Candidate
Shana Madoff Bernard L. Madoff Investment New York, NY Securities LLC …
http://www.finra.org/web/groups/Industry/@ip/@reg/@notice/documents/Notices/P038049.pdf – 2008-09-12 – Text Version
FINRA – NASD Board of Governors Appoints Four New Members to the …
… Those returning industry members are Douglas L. Kelly, Mark Madoff and Theodore
W. Urban. The National Association of Securities Dealers, Inc. …
http://www.finra.org/Newsroom/NewsReleases/2002/P002961 – 21k – Cached
[PDF] Notice to Members Special
… Triad Securities Corp. New York, NY Andrew H. Madoff Bernard L. Madoff Investment
Services LLC New York, NY Richard J. Paley Carey Financial Corporation …
http://www.finra.org/web/groups/Industry/@ip/@reg/@notice/documents/Notices/P014511.pdf – 2008-09-12 –
… FINRA Oversight of Bernard L. Madoff Investment Securities’ Broker-Dealer Operations. …
Issues Raised by the Madoff Fraud. Custody and Feeder Funds. …
http://www.finra.org/Newsroom/Speeches/StephenLuparello/P117784 – 38k – Cached
FINRA – Testimony of Interim CEO Stephen Luparello Before the …
… FINRA Oversight of Bernard L. Madoff Investment Securities’ Broker-Dealer
Operations. Bernard … firm. Issues Raised by the Madoff Fraud. …
http://www.finra.org/Newsroom/Speeches/StephenLuparello/P117765 – 39k – Cached
FINRA – NASD Board of Governors Appoints Four New Members to the …
… Former NASD District 10 Committee Chair Mark D. Madoff, Director of Listed Trading
at Bernard L. Madoff, New York, New York, has been appointed to the NAC as …
http://www.finra.org/Newsroom/NewsReleases/2001/P010061 – 22k – Cached
FINRA – NASD Pleased with Court Action
… Bernard L. Madoff, head of Madoff Investment Securities, said, “I support this
transaction and believe that it is in the best interests of the members. …
http://www.finra.org/Newsroom/NewsReleases/2000/P011371 – 22k – Cached
FINRA – NASD Names 20 To Mutual Fund Task Force
… Kansas City, MO; Mark D. Madoff, Co-Director of Trading, Bernard L. Madoff
Investment Securities LLC, New York, NY; Robert McCann …
http://www.finra.org/Newsroom/NewsReleases/2004/P002825 – 22k – Cached
Plenty of Madoffs here! All related very closely to the Master Thief. All, part of the FINRA system. Below is a story from 2000 which I illustrated with some details so we can see how FINRA operates and who it represents:
2000: NASD Pleased with Court Action
Washington, DC – The National Association of Securities Dealers (NASD® ) said that it was pleased with the New York State Court denial of the effort to block its membership vote scheduled for Friday. The effort to block the vote was part of a suit filed today in New York State Supreme Court in Manhattan by Zeus Securities, Inc. of Jerico, NY, and the Independent Broker-Dealer Association. The suit had asked the judge to issue a temporary restraining order to halt an NASD member vote on the restructuring scheduled for Friday. The judge denied the request for delay and ordered the parties to appear before him on Monday.
Below is Zeus Security’s web page:
Notice the line at the bottom left hand corner: UNDER CONSTRUCTION. HAHAHA. I see this all the time with financial advisors! They sometimes run the crummiest web sites. I suppose these are built the same way the accountants work: some goofy kid in the back room, hacking computers and an old lady in the front who is mostly blind and the office in some run-down shopping strip in Nassau county.
Here are the stats for Zeus:
This company profile is for the private company Zeus Securities Inc , located in Hauppauge, NY. Zeus Securities Inc’s line of business is security broker/dealer.
Company Name: Zeus Securities Inc Address: 111 Smithtown Byp Ste 209, Hauppauge, NY 11788-2512 (Map)
Alt Business Name: Location Type: Single Location Est. Annual Sales: $290,000 Est. # of Employees: 3 Est. Empl. at Loc.: 3 Year Started: 1987 State of Incorp: SIC #Code: 6211 Contact’s Name: Allan Davidson Contact’s Title: President NAICS: Securities Brokerage
HAHAHA! Three employees! The boss, the computer hacker kid and the old lady with poor eyesight! And look where they operate:
Either they are hitch hikers, or they live in a van or that tiny object to the lower right of the big red balloon with the A is their shack? Actually, I guess they have an office in one of these buildings.
“This lawsuit is baseless,” said Edward S. Knight, executive vice president and chief legal officer of the NASD. “We are extremely gratified that the judge denied the request to halt the members’ vote. We are also very pleased that the judge set a schedule so that this suit can be decided expeditiously.”
“This eleventh hour delay tactic sought to use the court to prohibit the membership from speaking and is counter to the democratic process. It would have been bad for not only the thousands of NASD members who have reviewed the plan and registered their vote, but for the US financial markets in general. Consequently, we will continue to take whatever steps are necessary to protect our thoughtful and responsible process.” said Mr. Knight.
Several NASD members commented:
Frank E. Baxter, chairman and chief executive officer of the Jeffries Group (headquartered in Los Angeles) remarked, “The offering is good for every single member of the NASD. After an increase in the allocation to smaller members, Alan Davidson vociferously endorsed the plan. Then, with no apparent reason he is trying to trash it. The first Alan made more sense.”
Here is Baxter’s Jeffries Group’s stock chart:
A bubble just like all the bankers and brokers and other vermin.
“As a small member, I can say that Davidson does not represent me or my firm’s interests,” said Robert Clark, president of HC Wainwright & Co. in Boston. “Davidson’s organization has no known board of directors, a secret membership, and is not representative of the majority of NASD’s small member firms.”
“We are baffled by this suit. Mr. Davidson publicly spoke in favor of the plan. Now, for unknown and inexplicable reasons, he has reversed his position,” said Richard C. Romano, president and chief executive officer of Romano Brothers and Company, Evanston, Illinois. “If he were truly acting in the best interests of members, he would live up to his fiduciary responsibility and allow the members to fully choose.”
“I was an IBDA member” said Benita Pierce, president of B. Pierce & Co. “Davidson did not represent my interests as a small firm when I was an IBDA member, and he certainly does not represent my firm’s interests now. I voted in favor of the transaction and I resent that Davidson is trying to squelch my vote.”
And here is Bernie Madoff!
Bernard L. Madoff, head of Madoff Investment Securities, said, “I support this transaction and believe that it is in the best interests of the members. The world’s securities markets are rapidly changing and Nasdaq must be free to address these competitive issues now. Anything that delays the Nasdaq transaction from going forward jeopardized Nasdaq long term value to the membership.”
Below is a recent letter to all FINRA members who have more than 2 employees and accountants who are 6′ under:
February 9, 2009
Dear Small Firm Member:
FINRA created the Small Firm Advisory Board (SFAB) in 1998 to advise FINRA’s Board of Governors on the impact of proposed regulatory initiatives on small firms. There are now five elected members of the SFAB (one from each region) and five members appointed by FINRA. In addition, the three small firm representatives on the Board of Governors serve as ex-officio members of the SFAB. The SFAB meets five times a year with senior members of the FINRA staff at FINRA’s offices in Washington. The SFAB plans to update you periodically on our activities and get your input on small firm issues through the small firm page on the FINRA web site, http://www.finra.org/Industry/smallfirms.
At the SFAB’s January 27, 2009 meeting our agenda highlighted a discussion of the recent SEC requirement for non-public broker dealers to use a Public Company Accounting Oversight Board (PCAOB) registered accounting firm. In December the SEC decided not to renew the non-public firm exemption issued in 2003 from the requirement to have an annual audit conducted by a PCAOB registered auditor for fiscal years ending after December 31, 2008. The SFAB has been in conversations with FINRA since we learned of this decision. Please note that this was not a FINRA decision but that of the SEC. In light of the Madoff matter, it is unlikely that small firms will be able to get a reversal of this decision in the near term. In fact, we have now become aware that Congressman Paul Kanjorski, who is the chairman of the House Capital Markets Subcommittee, is planning to introduce legislation that would effectively permit the PCAOB to have jurisdiction over the audits of all broker-dealers. The impact of such legislation could be quite significant.
FINRA had been working with the SEC to publish a series of FAQs to address questions raised by non-PCAOB registered accounting firms. In light of Congressman Kanjorski’s planned legislation, we are not currently aware of what the SEC’s plans are in this regard.
Oh my god! Outside accountants checking in on these guys! The world is coming to an end! Reviewing the books of dead accountants or trying to find these guys where they retire and leave no staff behind…hard work ahead for the PCAOB, tracking down all these phantom bookkeepers.
P.O. BOX 483
BERLIN, NY 12022
Make checks out to ‘Elaine Supkis’