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US tycoon charged over $8bn fraud US tycoon charged over $8bn fraud
(10 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". The Securities and Exchange Commission said the financier had orchestrated "a fraudulent, multi-billion dollar investment scheme".
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. English cricket bosses have pulled out of sponsorship talks with Sir Allen.
The charges against Sir Allen, three of his companies and two executives of those companies followed a raid by US marshalls on the Houston, Texas, offices of Stanford Financial Group.
We are alleging a fraud of shocking magnitude that has spread its tentacles throughout the world Rose Romero, SECWe 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 US judge has frozen the assets of Sir Allen and the other defendants as well as those of the 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.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. 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 England and Wales Cricket Board (ECB) suspended sponsorship negotiations with him following the fraud charges.
The ECB has a five-year deal to play games against the Stanford Superstars.
The SEC said that SIB sold approximately $8bn worth of certificates of deposit to investors, promising "improbable and unsubstantiated high interest rates".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. The charges follow follow the arrest of US financier Bernard Madoff in December over an allege $50bn (£35bn) investment fraud.