Victims of fraudster Allen Stanford won a battle over $110 million that is frozen in Swiss bank accounts. The funds are on their way back to the U.S.
Balz Bruppacher, guest author
Switzerland’s highest criminal court denied an appeal by Société Generale’s Swiss arm over assets linked to Ponzi schemer Allen Stanford, according to a ruling made public on Friday. The move paves the way for Swiss justice officials to return $110 million to the U.S., a spokeswoman for the Swiss government confirmed to finews.com.
The decision caps an 11-year saga assets linked to Stanford, who is serving an 110-year prison sentence for overseeing a more than $7 billion Ponzi scheme. Stanford oversaw the second-largest such sham ever, after Bernie Madoff, according to U.S. prosecutors. A lawyer for Socgen wasn't immediately available for comment.
Deep Swiss Ties
Socgen had argued that it had no knowledge of Stanford’s fraudulent dealings when it took the assets. Stanford maintained deep ties to Switzerland, including with a Swiss limited share company. Ex-government minister Adolf Ogi was among his high-profile advisers.
Specifically, Friday’s court ruling backs Swiss justice officials in cooperating with a court in Houston, which ordered Stanford assets seized and returned to the U.S. The court deferred Socgen’s argumentation to a 2013 decision from Swiss banking regulator Finma.
The Bern-based supervisor had reprimanded the French bank’s Swiss subsidiary for serious violations in its duty of care on the Stanford assets. Socgen fought Finma as well, a battle it lost in a 2016 court decision.
Money On Its Way
Since the Stanford fraud surfaced in 2009, Swiss officials cooperated with several legal aid requests from U.S. prosecutors. Stanford’s victims have maintained that unlike Madoff’s victims, they have been unable to recoup their investments.
The Swiss court ruling refers to two accounts with a total of $105.7 million at the end of 2018, while U.S. media had reported $110 million held in Switzerland. A spokeswoman for Switzerland’s justice office told finews.com «the restitution process is underway».
Swiss officials eventually liquidated Stanford’s Swiss firm, after it was fined 1 million Swiss francs ($1.1 million) by Switzerland’s attorney general following a money laundering investigation. The Swiss subsidiary, Stanford Group (Suisse) AG, was also ordered to recompense victims several million francs.
Balz Bruppacher is a veteran Swiss journalist who oversaw the Associated Press’ domestic service from 1983 until 2010. He has written extensively about money laundering, including for «Neue Zuercher Zeitung». His book on dictator money in Switzerland, «Die Schatzkammer der Diktatoren» (in German only), was published in April.
