It's just not cricket! Allan Stanford, Stanford International Bank and the whole rotten empire is toast.

You're out, Allen

The ECB (guys in blazers that run cricket) has just broken off talks with Cur Allen Stanford over a new sponsorship deal. Apparently it just is not the right thing to do business with cads and bounders.

Felix Salmon has done a nice overview of the SEC complaint with a list of salient points. He calls it "quite astonishing" and after reading it through carefully your humble correspondent has to agree. Go take a look a Salmon's post and while you're there give him the kudos he deserves in the comment boxes. He was the only high traffic blogger with the balls to run with this, he chided MSM all week about being so wishy-washy and he got the story out there and noticed by the larger world. While you're reading Salmon, read the full SEC complaint which you can download right here.

Duck Tales, the excellent report that started all this ball rolling, can be found right here, so go download it now and read a piece of financial history. The SEC moves today would not have happened, repeat would NOT have happened without the initial momentum caused by this brave and insightful report. Alex Dalmady is the unsung (so far) hero of the hour. May his star rise in the firmament.

The Devil's Excrement deserves special mention, as blog owner MO made the Duck Tales report available and wrote an impressive post that allowed Dalmady's note to finally catch the attention of the wider world.

The power of quality econoblogging has been definitively vindicated.

Click here for all IKN posts on Stanford (the series begins February 10th)

A small cog in a larger machine

Well nail me to the floor and call me Ethel, look what just popped up on the front page of Yahoo Finance (with auto-horntoot extract pasted below):

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Bloggers Will Catch the Next Madoff

by Mick Weinstein

".............As Dalmady dug deeper, he found lots of problems with Stanford's products, documented them in a report called "Duck Tales" (if it looks like a duck, walks like a duck, and quacks like a duck...), then uploaded that report to the 'net for public consumption. Dalmady published the report in a Venezuelan econo-mag, but noticed that his work on Stanford only "really exploded once it hit the blogs. Miguel Octavio's The Devil's Excrement [at Salon.com] took up the story on Monday the 9th, as did Caracas Gringo."

Salon's Octavio noted at the time: "For many years, I have been hearing stories about SIB. When most banks paid 3% in deposits, SIB paid 6-8%. No amount of digging or understanding would clarify what it was they were doing, much like Madoff did in the US, where he managed to trap some very smart people."

Latin American blog Inca Kola News carried the torch further on Tuesday: "I really stopped what I was doing and pulled the Stanford filings...and looked again. The fact that the bank has missed two relatively small recent payments while supposedly boasting a large liquid asset base is rather strange..."

Then Felix Salmon, blogging at Portfolio.com, pulled together more yada yada continues here

Mo' Stanford

Allen in happier times

Here's Felix Salmon keeping the wider world up to date with the latest down here. Excellent to see a big traffic blog caring about this story. Be sure to check out the comment underneath Salmon's post written by "anonymous" (one of the reasons I don't like that name appearing here).

Here's Bloomberg on Stanford today. Well worth a full read, but here's how it starts:

Feb. 12 (Bloomberg) -- Stanford Group Co., a Houston-based investment firm led by billionaire R. Allen Stanford, is under investigation by U.S. securities regulators over sales of certificates of deposit in its affiliated offshore bank and the consistent, above-average returns those investments pay.

Investigators from the Financial Industry Regulatory Authority visited six Stanford Group offices last month, downloaded information from computer hard drives and looked through files, people familiar with the events said. Two former Stanford financial advisers were questioned last month by the Securities and Exchange Commission, according to the people, who declined to be identified because they yada yada continues here

UPDATE: BusinessWeek in on the act here, and the London FT via Alphaville here

Related Post
Alex Dalmady, blogger
Alex Dalmady guest blogs on IKN (February 14th)
The Stanford Scandal: Alex Dalmady speaks

Four more on Stanford International Bank

Anyone for cricket?

1) The story is getting traction. Felix Salmon over at his high traffic blog "Market Movers" has picked up on the story.

2) So far today this humble blog has had several visits from major newswires, three visits from the US Federal Reserve and one from the SEC, all using combos of "Alex Dalmady", "Stanford", "Madoff" etc as keyword entries*. Not to mention all those people from some island called Antigua and plenty from a company called "Stanford Eagle" in Houston. Hi guys, having a nice day?

3) The more I think about it, the better the original article written by Alex Dalmady that points to SIB bank looks. It's an excellently constructed note and deserves plenty of eyeballs. Here's the link again.

4) I can't help but be reminded of this post dated 25th October that quoted a large chunk of JK Galbraith work, The Great Depression. Here's part of the quote:

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At any given time, there exists an inventory of undiscovered embezzlement in, or more precisely not in, the country's businesses and banks. This inventory—perhaps it should be called the bezzle—varies in size with the business cycle. In good times, people are relaxed, trusting, and money is plentiful. And even though money is plentiful, there are always many people who need more. Under these circumstances, the rate of embezzlement grows. The rate of discovery falls off, and the bezzle increases sharply.

In Depression all this is reversed. Audits are penetrating and meticulous. Commercial morality is enormously improved. The bezzle shrinks."

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Related Post
Alex Dalmady, blogger
Alex Dalmady guest blogs on IKN (February 14th)
As bad banks seem all the rage......
More evidence that Stanford International Bank is in a tight spot
The Stanford Scandal: Alex Dalmady speaks
Stanford International: BusinessWeek and MSM getting busy now

* and by the way, the stats software cannot pick up on individuals, so rest easy. It can only tell me about companies or registered bodies such as gov't offices like the Fed. Big brother is not watching you.