More Stanford Financial Client Accounts to Be Unfrozen

More brokerage accounts tied to failed investment firm Stanford Financial Group, including those with more than $250,000 in assets which were frozen during the federal probe of alleged investment fraud at the firm, may be released soon.

The court-appointed receiver who took over operations of Texas billionaire Allen Stanford’s companies in February 2009 said this week that he will ask a judge to release more client brokerage accounts that have been frozen for nearly a month

Recently, thousands of Stanford Financial accounts holding less than $250,000 in assets were released back to investors, who had been struggling to pay bills without access to their funds since the accounts were frozen nearly a month ago. The new proposal would cover brokerage accounts containing a net asset value of $250,000 or more, including accounts held by JP Morgan Clearing Corp and accounts managed by other Stanford Financial companies.

Some Accounts Not Included

Accounts related to the CDs which were issued by the Antigua-based bank and those controlled by Stanford himself, the other defendants, or certain Stanford Financial employees will be exempt from the release, since they remain a focus of the investigation, officials said.

Thousands of investment accounts linked to Stanford Financial Group were frozen in mid-February 2009 after the SEC announced its case against Stanford. The hope was to preserve as many assets as possible to be returned to defrauded investors. However, officials have since said that many investors may not be reimbursed for money Stanford allegedly swindled from them.

SEC Charges Filed

Stanford and two corporate officers have been charged in a civil complaint by the Securities and Exchange Commission of defrauding investors of as much as $8 billion in the sale of fraudulent certificates of deposit in Stanford International Bank. One of the officers, the former chief investment officer, has been charged with a crime for allegedly obstructing the federal investigation into the company.

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