ST. JOHN’S, Antigua: Regional and international investigators have completed the first part of a probe into the operations of the country’s financial regulatory body, amidst new allegations that a second employee of the regulatory body has been implicated in the US$8 billion fraud allegedly committed by Sir Allen Stanford.
The probe had been ordered by the government after chief executive officer and administrator at the Financial Services Regulatory Commission (FSRC), Leroy King, was charged earlier this year.
Attorney General Justin Simon says progress has been made.
“The first stage was the Board, personnel and administrative construct which was completed last week,” Simon said. “The next stage is the regulatory framework and methodology which will identify breaches of the law and identify the rotten apples, if any.
“Recommendations will follow to strengthen the offshore sector and rebuild its integrity and standing within the global family.”
Simon’s announcement followed the disclosure in a plea agreement between former chief financial officer of Stanford Financial Group, James M. Davis and the United States government, about an oath which King and an unnamed FSRC employee took with Stanford to ensure that regulators did not “kill the business” of the Antigua-based Stanford International Bank (SIB).
Stanford allegedly scammed investors by selling fraudulent certificates of deposit through the bank.
Simon said although the revelations in Davis’ plea bargain “clearly implicate Leroy King and another”, it was also obvious that neither the FSRC Board, nor the staff as a whole, was involved in assisting in the fraud.
“We need not lose faith as the government is committed to transparency and the establishment of a strong legal framework staffed by qualified, dedicated persons,” Simon said.
Meanwhile, King is awaiting extradition to the United States to face a total of 19 charges – seven counts of conspiracy to commit wire fraud, 10 counts of conspiracy to commit mail fraud, conspiracy to launder illegal proceeds, and conspiracy to obstruct the Securities Exchange Commission in their investigations into Stanford and SIB.
No charges have so far been laid against the FSRC worker who allegedly played a part in trying to cover up the fraud.