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Say the phrase Ponzi scheme and Bernard Madoff's $50 billion fraud comes to mind.

Lost in Madoff's shadow, however, is Texan Allen Stanford. He has yet to go to trial.

But the people who invested $7 billion with Stanford have watched their fortunes evaporate while lawyers fight in a federal court in Dallas.

There are two parts to the charges Stanford faces: The criminal case, which is scheduled for trial in Houston; and the Securities and Exchange Commission's enforcement action, which has been unfolding in Dallas.

They've been ongoing for 32 months. Lawyers and experts in the Dallas case have been paid $50 million, while the victims have gotten nothing.

For all the pictures of Allen Stanford posing with cricket stars, women, and politicians, a single photo taken two years ago, after he was beaten by fellow inmates in a jail north of Houston may be the most memorable.

Published last year by The Daily Mail, it shows one eye nearly swollen shut amidst Stanford's pulverized face.

The photo may have given some of his victims a little solace at the time, but what Stanford's 20,000 investors want is their money back.

While most of them are from Mexico and South America, the bulk of his American victims are represented by the 4,000-member Stanford Victims' Coalition in Coppell. Most of them are small losers compared to the more flamboyant victims of the Madoff empire.

These investors, they're dying. They're literally dying, said Angela Shaw, who heads the victims' group.

Jim Bates had a stroke last December. It was preceded by two heart attacks. His physician says the stress from Bates' Stanford losses precipitated the health problems.

Bates and Pattye Ward, both past retirement age, live on a ranch in Central Texas. A few years ago before Bates lost more than $1 million in Stanford investments he and Ward had planned to wed.

Now the ranch will be sold.

It has destroyed all of our dreams, Ward said.

Prosecutors allege that Allen Stanford moved billions in investors' money to his bank on the island of Antigua. Stanford maintains his innocence.

Records show that the FBI and Texas bank regulators had questions about Stanford's operations more than 20 years ago. At that time, he was running another offshore operation in Montserrat.

Angela Shaw of the Victims' Coalition has spent much of the last two years reminding federal agencies what they've known for a long time about Stanford and what they should have done about it, in hopes of getting investors some of their money.

Records show Stanford cropped up on the SEC's radar in Fort Worth in 1998. Rose Romero, former head of the SEC in Fort Worth told Senate investigators the Stanford timeline didn't start until after 2004.

Romero resigned this year after questioning before a Senate committee.

I think where we, where I get upset, is knowing that our government could have stepped in, Pattye Ward said.

Stanford, his family, and associates gave big to political campaign funds. Texas Republican Sen. John Cornyn got $19,700 over eight years. Rep. Pete Sessions (R-Texas) received $41,375.

Democrats also benefited from Stanford's largesse. Stanford Financial was one of three sponsors of the Black Tie and Boots celebration at the inauguration of Barack Obama.

Both Democrats and Republicans raked in money from Stanford. Some have given it back.

Cornyn and Sessions turned over a portion of their donations to charity and kept the rest.

Angela Shaw has been to Washington 50 times in the last two years pleading for victims' relief. I never could have imagined that I would expend this kind of effort in life, trying to force the U.S. government to follow its own laws, she said.

Among her concerns is the behavior of the Securities Investors Protection Corporation, SIPC. Most of Stanford's brokers in the United States were insured by SIPC, which is supposed to insure investors for losses of up to $500,000.

SIPC ruled that it would cover the victims of Bernard Madoff's Ponzi scheme, but not those of Allen Stanford.

At least not so far.

An SEC panel ruled SIPC should cover Stanford's investors, but SIPC has not yet announced whether it would execute the SEC's decision.

We are constantly banging our heads against the wall, trying to see what other avenues we can pursue to try to recover these monies for investors, said attorney Ed Snyder of San Antonio, who is on an investors committee in the Dallas proceeding.

Although Stanford is charged with stealing more than $7 billion, Snyder says the sums remaining and traceable are much lower than that in the hundreds of millions.

Attorneys recently told a Dallas judge that the biggest pot of remaining money is in frozen accounts in Switzerland and the UK, probably amounting to about $300 million.

Stanford's five-jet air force, his yacht, and most of his real estate have already been sold, with some of the proceeds going to fund the shutdown and evaluation of his empire.

He created this facade of companies, luxurious offices, a fleet of private jet planes, yachts around the world. He put on this beautiful, wonderful facade to trick all of these investors into believing that this was a legitimate deal, Snyder said. In fact, the sole purpose of it was to basically steal all the money.

At age 86, Stanford investor Sam Kogutt has fought a lot of battles in his life. He served with the U.S. Army in both Belgium and Japan during World War II, and later struggled to build a business in Dallas.

Kogutt later sold his business to finance his retirement nest egg. Like many Stanford investors, he now strains to put what Stanford did to him and his family out of his mind.

I think about it quite often, because I worked for forty-two-and-a-half years, to build up from zero. To build up a big company, and Stanford got most of it, Kogutt said.

At this point, all proceedings against Stanford appear to be in neutral. The beating he got in jail just might be his salvation.

Allen Stanford says he has amnesia, attorney Ed Snyder said. He can't remember anything about his past and what he did for 20 years there in Antigua.

Stanford is being treated for addiction to pain and anxiety medication at a federal prison in North Carolina. His criminal trial has been postponed.

Other proceedings are stymied until the criminal proceedings take place.

The case is also extremely complex. A group of Antiguan litigators argue that they not U.S. authorities should be overseeing the dispersal of his assets.

All the while, the dollars that remain are dripping through the legal hourglass, and some lawyers say the victims will be lucky to retrieve one-tenth of what they lost.

E-mail bharris@wfaa.com

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