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Time to Dust Off Those Stanford War Stories!

Boy, it's funny how everyone in town now swears they always knew R. Allen Stanford was a crook.

Hail, the lady pouring my cafecito this morning went on and on about how she always thought the guy was bad news.

Now comes Shutts attorney Bowman Brown, who shares this delightful war story about the good old days:

During the 1980s, Stanford came calling at the office of Miami attorney Bowman Brown, a respected banking lawyer with the Shutts & Bowen law firm. Stanford needed help setting up a new venture.

"He wanted to set up an offshore operation with an office in Miami that would not be regulated by U.S. regulators," Brown said.

Suspicious, Brown declined the job.

I don't know, the last time I checked isn't that an attorney-client conversation?

Who cares, the guy's sunk anyway:

"It was an open secret in the banking community that the business model wasn't right," Brown said. "If you're paying above market rates and have a small accounting firm in a jurisdiction where they don't heavily regulate banks, and the process involves putting money into a black box and it comes out enhanced ... something is wrong."

About nine months ago, Brown said he saw Stanford in the elevator of his building, and Stanford bragged about the billions of dollars under management. But Brown got the last laugh. Last week, the Securities and Exchange Commission charged Stanford with orchestrating an $8 billion fraud selling high-yield certificates of deposit in his Antiguan bank. The SEC froze the assets of three of the companies Stanford controls: the bank; Stanford Group Co., a broker-dealer; and Stanford Capital Management, an investment adviser.

All Brown can say now is: "I am so glad I took a pass."

See, everyone knew -- except the SEC (and Bowman's clients).

Full post as published by South Florida Lawyers on February 23, 2009 (boomark / email).