Emily Chan
When his $8 billion Ponzi scheme was exposed, Allen Stanford, a Texas billionaire known for his lavish lifestyle and extravagant promises, was reduced to a life behind bars. He is serving 110 years in prison for defrauding thousands of investors. His fraudulent scheme is the second largest in history.
Stanford came from humble roots. He was born in 1950 to a lower-middle-class family in the town of Mexia, Texas. He started out as an insurance salesman and a bookkeeper. Eventually, he rose to be a successful investment manager. He handled billions of dollars in assets from investors.
In 1991, he founded the Stanford Financial Group in Antigua, becoming the largest employer on the Caribbean island. At its peak, the Stanford Financial Group had clients from 140 countries and assets of $50 billion.
In 2006, Stanford was knighted by the Antiguan government and was referred to by the title of “Sir.” By 2008, Stanford was worth about $2.2 billion and was one of the wealthiest, most powerful men in America.
When he was arrested in 2010, his knighthood was revoked. He was convicted in 2012 of a $8 billion Ponzi scheme involving certificates of deposits (CDs).
Stanford used the money that investors put toward CDs at his Stanford International Bank to fund a lifestyle of opulence and his own risky investments.
His empire was built on the allure of extraordinary returns and prestigious cricket tournaments.
In a lawsuit, Stanford’s investors claimed that the Securities and Exchange Commission (SEC) had missed or ignored signs of his scandal for years.
In 1997, the agency conducted investigations into Stanford’s operations and found suspicious activity.
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