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US tycoon charged over $8bn fraud | US tycoon charged over $8bn fraud |
(40 minutes later) | |
Texan billionaire and cricket promoter Sir Allen Stanford has been charged over a $8bn (£5.6bn) investment fraud, US financial regulators say. | Texan billionaire and cricket promoter Sir Allen Stanford has been charged over a $8bn (£5.6bn) investment fraud, US financial regulators say. |
The Securities and Exchange Commission said the businessman had orchestrated "a fraudulent, multi-billion dollar investment scheme". | |
US investigators earlier entered the Stanford Financial Group Texas office. | US investigators earlier entered the Stanford Financial Group Texas office. |
The SEC said the fraud was "based on false promises and fabricated historical return data". | The SEC said the fraud was "based on false promises and fabricated historical return data". |
Three of Sir Allen's companies have been charged as well as several executives of the companies. | Three of Sir Allen's companies have been charged as well as several executives of the companies. |
We are alleging a fraud of shocking magnitude that has spread its tentacles throughout the world Rose Romero, SEC | |
A US judge has also frozen the assets of Sir Allen and the other defendants as well as those of the Texas-based investment firm Stanford Group, its Antigua-based subsidiary Stanford International Bank (SIB) and another subsidiary, investment advisor Stanford Capital Management. | |
A receiver has been appointed to "preserve assets for investors", the SEC said. | |
'Close circle' | 'Close circle' |
Sir Allen last year promoted the Stanford cricket Series which saw a West Indian all-star team - the Stanford Superstars - beat an England team for a $20m prize. | |
The England and Wales Cricket Board has suspended sponsorship negotiations with him following the fraud charges. | |
The SEC said that SIB sold approximately $8bn worth of certificates of deposit to investors, promising "improbable and unsubstantiated high interest rates". | |
The bank was "operated by a close circle of Stanford's family and friends", the SEC said in a statement. | The bank was "operated by a close circle of Stanford's family and friends", the SEC said in a statement. |
"We are alleging a fraud of shocking magnitude that has spread its tentacles throughout the world," said Rose Romero of the SEC. | "We are alleging a fraud of shocking magnitude that has spread its tentacles throughout the world," said Rose Romero of the SEC. |
The charges follow follow the arrest of US financier Bernard Madoff, charged in December with a $50bn (£35bn) investment fraud. |