Here at TPMmuckraker, the more we think about the Allen Stanford saga, the more it seems like a kind of harmonic convergence of recent high-profile muck.
The emerging story's range of ties -- some incidental, some more substantive -- to some other high-profile scandals of the past few years, from Bermard Madoff to Jack Abramoff to Rod Blagojevich -- is pretty striking.
It's not just that questions about the pace of the SEC's Stanford investigation -- including whether the agency's decision
to bring charges yesterday was prompted in part by recent news reports -- have to be considered in light of the SEC's well-documented missteps
on the Madoff case.
It's also that, according to the SEC complaint
, Stanford's investors were exposed to losses via Madoff -- but falsely assured them they weren't.
From the complaint:
In a December 2008 Monthly Report, the bank told investors that their money was safe because SID "had no direct or indirect exposure to any of [Bernard] Madoffs investments."
But, contrary to this statement, at least $400,000 in Tier 2 was invested in Meridian, a New York-based hedge fund that used Tremont Partners as its asset manager. Tremont invested approximately 6-8% of the SIB assets they indirectly managed with Madoffs investment firm.
Pendergest, Davis and Stanford knew about this exposure to loss relating to the Meridian investment. On December 15, 2008, an Analyst informed Pendergast, Davis and Stanford in a weekly report that his "rough estimate is a loss of $400k ... based on the indirect exposure" to Madoff'.
As for Abramoff, we reported yesterday
that a bevvy lawmakers with ties to the crooked lobbyist or a history of other ethical problems - including then-GOP members of Congress Bob Ney, Katherine Harris, Tom Feeney, and John Sweeney, as well as current Rep. Charlie Rangel -- went on a 2005 junket to Antigua that was funded by an organization with close links to Stanford.
Indeed, until yesterday, that organization, the Inter-American Economic Council, had photographs from the trip -- showing Harris, Feeney, and pals hobnobbing in splendor with Antiguan dignitaries -- posted on its website. It's since removed them, but not before we saved them. You can see the slideshow here
And there's also another congressional angle which, though not on a par with the Abramoff sleaze, nonetheless appears to reflect the cynical money-for-access culture that has characterized Washington politics in recent years:
In 2002, as we reported yesterday
, after lobbying from Stanford's firm, the Democratic-controlled Senate killed a bill designed to bolster efforts to catch financial fraud. During that cycle, Stanford's company had given an eye-popping $800,000 to the Democratic Senatorial Campaign Committee. And according to campaign finance records examined by TPMmuckraker, it had also given generously to key Democrats on the Senate Banking committee: $8000 to Chuck Schumer, $6000 to Chris Dodd, and $1000 to then-chair Paul Sarbanes.
So there's that.
What about Blago?
Well, it turns out that, according to lobby disclosure reports examined by TPMmuckraker, one of Stanford's paid lobbyists in 2002 -- the year that the firm was lobbying on the anti-financial-fraud bill -- was John Wyma. One form lists Wyma and his team's work as "Helping them address legislature (sic) which involves financial services companies."
In case you'd forgotten, Wyma used to be one of Blagojevich's closest aides, before cooperating with Pat Fitzgerald's investigation by secretly recording conversations
with the then governor.
The two were apparently think as thieves at one time. The Chicago Tribune
reported at the time of Blago's arrest:
The governor routinely reported exchanging personal gifts and often appeared at Wyma-sponsored fundraisers where Wyma's clients hobnobbed with the governor before turning over checks for his campaign fund.
Now all we need is a link to the U.S. Attorney firings, and we'll be all set.