U.S. diplomats warned about Stanford

KINGSTON, Jamaica (AP) — A newly revealed U.S. cable portrays American diplomats in the Caribbean as being so concerned about bribery and money-laundering rumors related to Texas financier R. Allen Stanford that they warned embassy officers to steer clear of him as early as 2006.

The behind-the-scenes diplomatic assessment from May 2006 was marked “confidential” and written three years before U.S. regulators announced they were investigating Stanford and his Caribbean bank for allegedly bilking investors out of $7 billion in a global Ponzi scheme.

The cable, apparently written by the former top diplomat in the U.S. Embassy in Barbados, Mary E. Kramer, warned that Stanford’s companies were rumored to be engaged in “bribery, money laundering, and political manipulation.” Embassy officers do not “reach out” to Stanford due to the rumors, it said.

That U.S. diplomats in the Caribbean heeded the rumors and gave Stanford the cold shoulder years before his 2009 indictment is surprising. At the time, Stanford was one of the most prominent businessmen in the region, with investment advisers around the world helping him grow a personal fortune once estimated at $2.2 billion by Forbes magazine.

Stanford’s businesses on the nearby islands of Antigua and Barbuda, where he had been knighted and addressed as “Sir Allen”, included two restaurants, a newspaper, cricket grounds, a development company, a three-branch local bank and the headquarters of his offshore bank.

The WikiLeaks cable, which first appeared late Monday on the website of the British newspaper The Guardian, describes Kramer’s efforts to avoid being photographed with Stanford at an April 2006 breakfast in Barbados with political leaders and cricket stakeholders. Stanford, a huge cricket aficionado, was pushing his Stanford Twenty-20 Caribbean Cricket Tournament held in Antigua.

“The ambassador managed to stay out of any one-on-one photos with Stanford during the breakfast,” the cable said. “For his part, Stanford said he preferred to conduct his business without contacting the embassy, resolving any investment disputes directly with local government.”

Stanford and three ex-executives of his now-defunct Stanford Financial Group are accused of orchestrating a colossal pyramid scheme, allegedly advising clients from 113 countries to invest more than $7 billion in certificates of deposit at the Stanford International Bank on Antigua, and promising huge returns. He has been jailed since his U.S. indictment in June 2009.

His Caribbean bank was based in Antigua and Barbuda, which has carved out a niche as a tax haven and offshore base for Internet gambling.

In a later cable from the U.S. Embassy in Barbados dated Feb. 18, 2009, U.S. diplomats described the impact of the Stanford indictment, which took place as Antiguan Prime Minister Baldwin Spencer called general elections.

“No sooner did the PM’s election date announcement hit the airwaves, when news of a major SEC indictment against Antigua’s richest citizen, primary banker, and second largest local employer and philanthropist, Sir Allen Stanford, shock the small island — with ripples extending throughout the Eastern Caribbean,” the cable said.

The 2009 communique said it was unclear whether the tiny country’s two political parties would attempt to use the Stanford indictment as an election issue since Stanford amassed his fortune under the Antigua Labor Party and was knighted by a United Progressive Party administration.

“So all hands are likely equally dirty,” the leaked cable said.

Stanford’s attorneys say he ran a legitimate business and didn’t misuse bank funds to pay for a lavish lifestyle, as prosecutors allege. Stanford and the executives have pleaded not guilty to various charges, including money laundering, and wire and mail fraud.

Once considered one of the wealthiest men in the U.S., Stanford has been declared an indigent defendant in Texas and had to have lawyers appointed by the court.

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