Jaime Escalona speaking on behalf of COViSAL denounces millions of dollars in fees, and the fleecing of thousands of innocent families.
• What’s been recovered by the US Receiver and Joint Liquidators during almost 7 years, goes to pay exorbitant attorneys’ fees and expenses.
Until now, the only ones benefiting from the receivership and the liquidation of the Stanford Financial Group (“SFG”) and the Stanford International Bank Limited (“SIBL”), are the attorneys and their professionals. “It appears that they are purposely prolonging the legal process and litigation to continue generating millions of dollars in fees for themselves until the creditor’s patrimony is depleted,” affirms Jaime Escalona, founder and leader of COViSAL, an international coalition of depositors who lost their life-savings with Stanford.
The US Receiver, Ralph Janvey, shows $75.1 million dollars spent in professional fees and expenses as of May 31, 2014 in his 8th application for fees and expenses registered before the US Federal Court in Dallas, Texas. The Joint Liquidators, Marcus Wide & Hugh Dickson of Grant Thornton (“JLs”), presented their 6th Report before the High Court of Antigua that shows $43.8 million dollars spent on professional fees and expenses.
Fistful of money
Escalona points out, that as of May 31, 2014, “the Receiver has recovered $263.7 million. However, he has collected $160.2 million in expenses and attorney’s fees, not including the last 18 months – that’s over 60% of the total amount ‘recovered’ from Stanford’s bank accounts and fire sale of assets, leaving only meager sums for the victims.”
Recipients of the loot in the U.S.
Received by the U. S. Receiver and his attorneys.
Received by Stanford’s Examiner
Charged by the Investor’s Committee.
Charged for other expenses
“The Receivership’s attorneys and professionals have been very well compensated during the last six and a half years for the work they have performed. Unfortunately, they have not shown real accomplishments to deserve their $600 per hour fees. They have received more money than the victims – many of them pocketing millions of dollars while the victims have barely received a penny on the dollar.” Mr. Escalona explains.
According to the record presented to the High Court of Justice of Antigua & Barbuda on November 11, 2014, the Joint Liquidators (JLs) reported a total receipt balance of $109.5 million dollars. However, from this total the JLs have already spent $43.8 million in fees for attorneys, consultants and other expenses. So far they have spent over 40% of the total, without taking into account their fees for the last 11 months.
SIBL’s JLs recovered $8.1 million from the sale of Stanford’s assets in Antigua, and received $95.6 million from the frozen funds in England, belonging to Stanford’s depositors.
Escalona affirms that “JLs are spending at least $1 million monthly; and now are going after innocent families to deny them of their 1 penny on the dollar distribution which was announced over a year ago, and keeping the $25 million withheld from depositors to possibly use for their fees and expenses.”
Fistful of money
“JLs Marcus Wide and Hugh Dickson have received more than $8.3 million, their Co-lead legal advisor $12 million, and other unnamed legal advisors $16 million,” says Escalona.
“We would like the unnamed law firms to be identified, and would like to see the detailed invoices of their work, as well as the invoices of all the payments issued,” Escalona adds.
Recipients of the loot in Antigua
Payment received by the Joint Liquidators, Marcus Wide and Hugh Dickson of Grant Thornton.
Payment received by co-lead attorney
Payment for other legal advisers
Payment for other expenses
Withheld from innocent families accused of receiving preferential payments; most likely will be use by JLs to pay for their fees and expenses.
Rightful owner’s share
$0.01 cent on the dollar received by some depositors.
Easy prey, once again
On May 15, 2014 the High Court of Antigua issued an order appointing an Amicus Curiae due to the Joint Liquidator’s application to claw back alleged Net Winners and Preference Creditors. More than a year later, on August 5, 2015, Mr. Justice Gerhard Wallbank sided with the Joint Liquidators by issuing an order that allows the Joint Liquidators to pursue claims against depositors considered Preferential Payment Recipients. “The majority of depositors accused of receiving alleged preference payments withdrew some of their savings deposited at SIBL for living expenses, rightfully and in good will,” says Mr. Escalona.
“It is obvious that the Joint Liquidators are going to withhold the $25 million distribution from innocent families until they file suit against them and win the case. These families will not be able to defend themselves in court because they do not have money to hire an attorney, and most likely the JLs will win their cases. It is another tactic to prolong the suffering of depositors and keep this money for the continuation of self-enriching interests,” explains Mr. Escalona.
SFG and SIB administrators have secured their job for years
“The reality is that injustice continues for these victims as the U.S. Receiver and the Joint Liquidators insatiably persist in generating fees and expenses for themselves, their attorneys, and other professionals, the sole beneficiaries so far, charging millions of dollars during the past 7 years,” observes Mr. Escalona.
“We have not seen any meaningful efforts towards a real recovery for the victims and the accomplishments in the recollections of assets for the depositor’s distribution fund have been lacking. The Joint Liquidators and the US Receiver are just using the money confiscated in England and Canada to pay themselves and their colleagues, while forcing victims through a gauntlet for a pittance,” Mr. Escalona remarks.
Mr. Escalona comments, “It seems that our never-ending saga is being prolonged by design, to generate fees and expenses for attorneys and professionals responsible for the Stanford Case. We find it deplorable that Courts in the United States and in Antigua have allowed the U.S. Receiver and the Joint Liquidators, who were named to prevent the waste and squandering of the creditors’ patrimony, to continue consuming it at an alarming rate.”
According to the order appointing John Little as Stanford’s Examiner on April 20, 2009, he was appointed by the Court to convey information which the Examiner determines would be helpful to the Court in considering the interests of investors, and conduct such investigation as he deems necessary to provide such information to the Court. Also, on August 11, 2010 the Court approved the creation of a seven member Investor Committee, including the Examiner and six other members, representing a cross-section of the Stanford Investors, to provide additional opportunities for investors to participate in the activities of the Receivership.
Mr. Escalona says, “We exhort Stanford’s Examiner and the Official Stanford Investors Committee, which represents all Stanford investors’ interests worldwide, to voice our outcry and concerns expressed in this letter to the Courts and other authorities responsible for the Stanford Case. You have a fiduciary duty to the Stanford’s depositors and your decisions and actions must be carried out in consideration of the best interests of the creditor’s patrimony.”
The U.S. Receiver and the Joint Liquidators, were named to conserve, hold, manage, and prevent any waste of the creditors’ patrimony, and return the money to the innocent families. The extended protraction of the recovery of assets and the very small settlements are generating high billable hours and expenses to the administrators and their attorney, to the detriment of Stanford’s depositors.
“We demand clarity, transparency, integrity and fairness, and an end to a self-serving economic interest that irrationally pursues control over the assets, wasting what is recovered of our patrimony. Control of the money cannot be the driving force to bring justice and equity to thousands of innocent families left in poverty and desperation,” comments Mr. Escalona.
Mr. Escalona concludes, “The $200 million left of our savings which were confiscated in Switzerland must be distributed directly to Stanford’s depositors, otherwise, the US Receiver and JLs will squander the money to pay themselves. They have not made any significant distributions as of yet, just a couple of pennies on the dollar.”
“What honest and transparent legal entity is providing oversight of the liquidation’s and receivership’s affairs? Where are the check and balances? Are our fundamental rights being considered?” asks Mr. Escalona.
“We insist that U.S. and Antiguan Courts show the world their commitment to honesty, equality and justice with concrete and immediate actions. Innocent families in the US, Latin America, and around the world, have the right to a full restitution of their savings.
In God we trust that the rights of the victims will prevail over judicial manipulations, and that good conscience will be the instrument to impart justice and to stop a never-ending fraud.”
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