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Allen Stanford goes on trial for $7 bln Ponzi scam

January 23, 2012 - Washington

The trail for former Texan billionaire Allen Stanford, accused of defrauding thousands of investors in a seven billion dollars Ponzi scheme, will begin today.

Stanford is facing charges of duping investors of over seven billion dollars through his Antigua-based Stanford International Bank (SIB) to live off his income.

He has been lodged in prison since his arrest in 2009 on the grounds that he is trying to escape punishment.

His trial was earlier postponed following three doctors' ruling that he was "incapable of standing proceedings due to extensive retrograde amnesia."

Over 20,000 people who invested with Stanford have yet to see any of their money returned, The Telegraph reports.

According to the reports, US prosecutors alleged that the Caribbean bank managed to offload 2 billion dollars of the certificates to investors in the two years before the global financial crisis arrived in 2008.

Instead of putting the money in the safe and liquid assets that SIB's marketing brochures touted, prosecutors claimed that Stanford, with the assistance of a handful of his colleagues, used at least 1.6 billion dollars of it to fund an opulent lifestyle for himself.


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