(Editor's Note: Through her attorney Alan Breaud, former Stanford Group Co. financial advisor Tiffany Angelle says the story below includes untrue information. “She is quite upset about the article and the damage to her reputation,” Breaud writes in an e-mail. “She has never given a Rolex or any other gift to get someone to invest.” In a phone interview, Breaud also said Angelle didn’t take any investors on trips to keep them from withdrawing money. The Independent Weekly has attempted several times to reach Angelle by phone [at the address listed in the lawsuit], but no one answers and there is no machine set to accept messages.)
When a Lafayette investor was threatening to pull his money out of Stanford Group Co., his financial advisor, Tiffany Angelle, set about to change his mind, flying him to the West Indies island of Antigua, where parent company Stanford International Bank is headquartered. He was lavishly entertained, and the attractive blond advisor also presented him with an expensive gift: a Rolex watch.
Such extravagancies (anyone ever go to a Stanford-sponsored LSU tailgating party?) appear to have been a common tactic for a company the SEC in mid-February alleged was operating a Ponzi scheme that cost victims more than $8 billion, most of which was sent to Antigua. Now more of those alleged victims are seeking to recover $6.5 million from 10 investment advisors in Louisiana, according to the Stanford receiver’s suit filed in U.S. district court in Dallas last week. Seven of those advisors are in Baton Rouge, and three others are in Denham Springs, Zachary and Lafayette. Tiffany Angelle and Hank Mills of Baton Rouge, who also worked in the Lafayette office in River Ranch, are among them.
Last week’s suit — which names Stanford Group Co. advisors as relief defendants in the Feb. 17 complaint the SEC filed against Stanford International Bank, two its subsidiaries and their top officials — appears to be the first to name Angelle. It is just the latest in a number of lawsuits that have been piling up; another was filed in Baton Rouge last month by 10 investors (Mills is a defendant in that suit).
Individuals named as defendants in the original SEC Feb. 17 complaint are R. Allen Stanford, SIB’s chairman of the board and sole shareholder; James M. Davis, SIB’s chief financial officer; and Laura Pendergest-Holt, SIB’s chief investment officer. In last week’s complaint, 66 financial advisors in Louisiana and seven other states were sued for more than $40 million by Ralph S. Janvey, the court-appointed attorney who since February has been overseeing the financial empire of R. Allen Stanford.
“Over a two-year period, these financial advisors received commissions ranging in amounts from $2.6 million to $200,000, along with incentive compensation, to promote the sales of CDs,” from SGC’s affiliate, SIB, according to the suit. “In selling the CDs to investors, Defendants [R. Allen Stanford, Davis and Pendergest-Holt] repeatedly touted the CDs’ safety and security and SIB’s consistent, double-digit returns on its investment portfolio.” Janvey’s April 15 complaint was filed on the heels of his request that the court release accounts held by Stanford Trust Co., which was based in Louisiana.
According to the complaint, the company used an elaborate and sophisticated incentive program to keep its advisors highly motivated to sell the so-called CDs to bring in new money and to minimize redemptions of CDs previously sold (a claim the incident with Angelle and the Rolex seems to support.) The program included high commission rates, bonuses, and forgivable loans. For example, in return for placing investors’ money with the offshore bank, Janvey claims that advisors often received a 1 percent commission upon the sale of a CD and as much as an additional 1 percent trailing commission during the term of the CD. In 2007, SIB paid SGC and its affiliates more than $291 million in management fees and commissions on CD sales, up from $211 million in 2006.
Listed among what Janvey calls “ill-gotten proceeds from a fraudulent scheme” are $1.4 million earned by Mills, and $675,664 by Angelle. But it was the almost $1.3 million earned by Baton Rouge financial advisor Michael Word from January 2007 to January 2009 that stoked the anger of 59-year-old Maurice resident Troy Lillie, a Stanford investor. Word was Lillie’s financial advisor for the past four years.
When Lillie didn’t see any commissions coming out of three CDs he purchased, he asked Word how he was making money. “He told me Stanford paid him a salary,” Lillie recalls. Lillie’s not happy about the revelation that his advisor was earning a commission on the front end and renewal of his CDs. “I didn’t even know about it. The CDs were all in an IRA account; all I would see is each quarter was a statement showing the interest they had accrued and the total value. I assumed the only thing he was making was the salary and or the commission on any stock sales,” Lillie says. “The only time I ever saw anything come out of my account was when I sold stock once a year; a commission would come out.”
And while the retired ExxonMobil employee redeemed his so-called CDs in January and put them in a money market account, taking an $18,000 penalty on $920,000, he cannot touch the funds because they have been frozen. They also may be subject to the “clawback” provision, which allows the courts to retrieve money already paid out to Stanford investors.
Investors have also been infuriated by Janvey’s claims that significant portions of SIB’s portfolio were misappropriated by R. Allen Stanford and used by him to personally acquire private equity investments and real estate.
In order to conceal their fraud and ensure that investors continued to purchase CDs, R. Allen Stanford and other officials fabricated the performance of SIB’s investment portfolio, Janvey alleges, noting that for a time the company was able to keep the fraud going by using a portion of the funds from current sales of the SIB CDs to make interest and redemption payments on pre-existing CDs. However, in late 2008 and early 2009, CD redemptions increased to the point that new CD sales were inadequate to cover redemptions and normal operating expenses. “As the depletion of liquid assets accelerated, the fraudulent scheme collapsed,” Janvey writes.
After reading Janvey’s complaint, Lillie — who is still struggling to cope with the financial loss he faces — hopes he never has to talk to his former financial advisor again. “I don’t harbor hatred or anything like that,” Lillie says. “But now I feel like I was used.”
Acadian rep notifies would-be supporters that an April 25 fundraiser for the embattled U.S. rep won’t go on as planned.
While it isn’t all too unusual for public bodies to have hired security present during meetings, the LPSB’s push to do so is arguably a response to the antics of one board member.
“I’m running. Why would I be raising all this money? Just to have to return it to people?”
With incumbent U.S. Sen. Mary Landrieu watching from afar, and with a united Democratic Party in her corner, the fight to get the GOP officially behind Congressman Bill Cassidy is gaining just as much momentum as it is hushed controversy.
15th Judicial District Judge Durwood Conque has announced that he will not seek re-election after 27 years on the bench.
The controversial standardized tests are set to be used in third-grade through eighth-grade public school classrooms next year.
The Louisiana Senate has agreed to prohibit unmanned aircraft from flying over chemical plants, water treatment systems, telecommunications networks and other items considered "critical infrastructure" in Louisiana.
It didn’t take long for KATC TV 3 to jump all over the news of a dead body found in Girard Park, but in its rush to produce headlines, the local TV station got sloppy.
Tuesday's Blogs from the Bog!
Here's your daily look at late-breaking national and international news, upcoming events and the stories that will be talked about Tuesday, April 15, 2014:
An unholy trinity of civil-society upheavalers whose first names are not Conner, Tanner or Logan are facing charges in Eunice.
Now that lawmakers have shot down efforts to cap annual interest rates for payday loans, supporters for stricter regulations of the storefront lenders are rallying behind another strategy.
The Appropriations Committee held public testimony day, letting people talk about what they like or don't like about Gov. Bobby Jindal's budget recommendations for the 2014-15 fiscal year that begins July 1.
Lafayette police are investigating the death of a 21-year-old woman whose body was found early Sunday in a drainage ditch in Girard Park.
Former Grant parish District Attorney Ed Tarpley says he's running for the U.S. House seat currently held by Republican Vance McAllister of Swartz.
Louisiana-Lafayette got strong starting pitching and timely hitting to hold off Arkansas-Little Rock 6-3 in Sun Belt Conference baseball in Lafayette, La.
Chris Williams knows how to pilfer from the public coffers, this time with a back-pay lawsuit filed three years ago against the Lafayette Housing Authority, which netted the former city-parish councilman a cool five figures.
McAllister's office vowed that he intended to stay in office — for now. As for questions about whether he would stand for re-election in November, those were dodged.
The Green Army's Lafayette brigade has announced it will pay a visit Friday morning to Sen. Page Cortez to urge him to vote against Sen. Robert Adley's SB 553, which the group is calling the "Big Oil Bailout Bill of 2014."
For the sixth consecutive year, Andy Nyman, LSU associate professor of wetland wildlife management, and his service-learning students plan to spend spring break differently from those students flooding the beaches of Florida.
When a BP oil well began gushing crude into the Gulf of Mexico four years ago, fisherman George Barisich used his boat to help clean up the millions of gallons that spewed in what would become the worst offshore spill in U.S. history.
The legislation — House Bill 503 by state Rep. Thomas Carmody, R-Shreveport — passed by an 8-5 vote and advances next to the full House.
The Republican Party of Louisiana has had enough with the philandering hypocrite Vance McAllister. David Vitter? Eh...
A top aide to a Louisiana congressman videotaped kissing a married woman who is not his wife was one of the few people with access to the leaked security footage that exposed the dalliance.
Louisiana would repeal an unconstitutional state law prohibiting intercourse between two people of the same sex, if lawmakers agree to a bill that narrowly received the backing of a House committee Wednesday.