Victims of Allen Stanford's Ponzi scheme still suffering

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by BYRON HARRIS

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WFAA

Posted on January 20, 2014 at 7:18 PM

Updated Wednesday, Jan 22 at 11:18 AM

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Next month marks five years since the Securities and Exchange Commission sued one of the biggest Texas crooks of all time.

Allen Stanford is serving a 110-year federal sentence for criminal activity related to his Ponzi scheme. But that's little consolation for his victims.

Angela Shaw knows that as well as anybody. She's the head of the Stanford Victims Coalition.

"The past five years have been really surreal," she said, describing a journey through the legal system that she could never have dreamed of had her own family not lost money to Stanford.

Attorney and administrative fees in the case have exceeded  $151 million, while Stanford's investor victims have received only about $55 million. That's roughly one penny on the dollar.

The suffering of these investors — most of whom entrusted $500,000 or less to Stanford — grows each day. Shaw said at least six have committed suicide and more than 100 others have died while waiting for financial justice.

Shaw said her group has often felt whipsawed by the counter-veiling interests of the Department of Justice, the SEC, the State Department and a handful of governmental interests in other countries.

"There are things that have happened with the government in this case that make you want to slam your head against the wall," she said.

Last week in Dallas, U.S. District Judge David Godbey wrapped up another hearing in the case with no clear victory for the U.S. investor/victims. Last fall, he ordered the penny-on-the-dollar distribution to the U.S. victims, the first in the case.

Although Stanford is believed to have scooped up nearly $6 billion in his Ponzi scheme, government attorneys have said he spent most of that money.

Shaw said the victims' best hope now is a law emerging from Congress that would stiffen the obligations of securities brokers in current and future cases. There are versions of the law in both the House and the Senate, but neither chamber has voted on it yet.

E-mail bharris@wfaa.com

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