Stanford case gets strange with blood oaths

While Bernard Madoff’s scheme was more grand in scale, Stanford’s multi-billion dollar scheme seems to be getting strange…

In 2003, R. Allen Stanford and the chief supervisor at the bank in Antigua made a blood oath in a strange “brotherhood ceremony.” Stanford’s chief financial officer, James M. Davis said in a document yesterday that the ceremony was all part of Stanford’s “elaborate scheme” to hide billions of dollars from regulators.

The bank blood brother would often receive gifts from Stanford, including a pair of tickets to the 2004 Superbowl. In return, if Stanford was saying that a regulator was getting too close for comfort, that regulator would be fired or simply given another job. The next year, the SEC filed a document to the bank saying that it was suspected to be in a Ponzi scheme, but Stanford had more false documents drawn up at that time to get the SEC off the case for awhile. Obviously, that didn’t work.
It didn’t work the next time it happened either.

James Davis plead guilty to fraud and conspiracy at the Federal District Court in Houston, TX. He had a plea agreement and told the courts about Stanford’s banking in offshore accounts as well as how Stanford told him to report false revenues as well as fake investment portfolio balances to the regulators. He said that he was ordered to report the false documents as far back as 1988.

Davis had been good friends with Stanford since the two were roommates at Baylor University. Stanford plead not guilty to all charges against him and has often said that if anything illegal was going on that it was the fault of Davis.

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