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PARALLELS BETWEEN STANFORD AND MADOFF CASES

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The Tampa Tribune

Published: March 1, 2009

R. ALLEN STANFORD

Age: 58

His Wealth: $2.2 billion, according to Forbes magazine
Investors' Funds: $8 billion

His Investors: He lured investors from Latin America who worried about stability in their home countries or currencies.

His Connections: He donated to campaigns of U.S. lawmakers and bankrolled public works and sports teams. He was knighted in Antigua.

His Enterprises: A newspaper, restaurants, a development company and the ornately landscaped Stanford cricket grounds in Antigua; private jets and homes in Antigua, Texas, Palm Beach and the U.S. Virgin Islands; businesses from Houston to Miami to Antigua to Switzerland.

Warning Flags: Settled in 2007 with National Association of Securities Dealers over claim company lacked capital to function as a securities brokerage firm; fined four times, with penalties totaling $70,000, for violations that included misleading investors in sales materials about the risks of the CDs; former employee filed lawsuit in 2006 alleging the company ran a Ponzi scheme; employees in 2008 said the company's Antigua bank sold CDs based on inflated returns and had destroyed documents; board of directors that included Stanford's father, his college roommate and a family friend who remained on the board years after suffering a debilitating stroke; the Antigua-based accounting firm that audited the offshore bank was tiny and little-known.

Legal Status: SEC accused him and three of his companies of carrying out a "massive, ongoing fraud" involving the sale of $8 billion in certificates of deposit, one of the largest alleged financial frauds in U.S. history. The FBI is investigating his business dealings, but has not charged him.
BERNARD MADOFF
Age: 71

His Wealth: Unknown

Investors' Funds: $50 billion

His Investors: Charities (including many connected to the Jewish community), banks and European aristocrats.

His Connections: Long a high-powered figure on Wall Street, he is a former chairman of the Nasdaq Stock Market who served on SEC advisory committees.

His Enterprises: Bernard L. Madoff Investment Securities; homes in New York and Palm Beach.

Warning Flags: A whistleblower, Harry Markopolos, had raised red flags to the SEC about Madoff starting 10 years ago. But the stature of Madoff "casts a glow around the person that might cause you to put your guard down a bit as a regulator," said Mercer Bullard, head of a mutual fund watchdog group and a former SEC attorney. Madoff's auditor was a no-name firm, run out of a drab building in a New York City suburb.

Legal Status: Madoff was arrested Dec. 11 after allegedly admitting that he ran a $50 billion Ponzi scheme. Under the conditions of his bail he is confined to his Manhattan apartment.

Information from The Associated Press and the Los Angeles Times was used in this report.

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