Investment fraud suspect Stanford was major political donor
Robert Allen Stanford, his firm, or its employees are said to have delivered $2.4 million to political operations since 2000.
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Suddenly Mr. Stanford, whose company ran a bank in Antigua, made a lot of friends, spreading money to both political parties and their leaders. The legislation languished in a Senate committee until the terrorist attacks of 9/11 convinced Congress it needed to act.
Stanford, accused by the US Securities and Exchange Commission (SEC) of an $8 billion fraud, continued to give money to scores of members of Congress, as well as the Obama presidential campaign.
The campaign contributions are “one vehicle to try to influence and skew policy,” says Sheila Krumholz, executive director of the Center for Responsive Politics (CRP), which follows campaign contributions. “Often the efforts are too brazen.”
Donations of $2.4 million
In Stanford’s case, since 2000 he, his company, or its employees have delivered $2.4 million to political operations, according to Ms. Krumholz. Stanford and his wife personally gave $931,000.
Although he donated to politicians of both parties, 65 percent of his donations went to Democrats, including $31,750 from Stanford, his family, and employees to the presidential campaign of Barack Obama.
“It’s a lot of money when you consider 99 percent of the public doesn’t even give $200,” the amount needed to gain the attention of the Federal Election Commission, Krumholz says. “It makes him a big player.”
In fact, politicians of both parties have been scrambling to distance themselves from the scandal. An Obama aide says the $4,600 contribution from Stanford himself has been donated to charity. Sen. Bill Nelson (D) of Florida is going one step further, shedding money that came from Stanford or his employees.
“Bill has told his campaign he wants every thin dime associated with Stanford returned to a charity or used in some way that could help folks who were deceived by this guy,” a Nelson aide says in an e-mail.
Echoes of Madoff scandal
The same thing happened after the Madoff financial scandal broke. Mr. Madoff and his wife were also contributors to the political process, giving $238,200 since 1991, according to the CRP. His own donations, plus those of his firm, total nearly $1 million.
Federal authorities accuse Stanford of “massive” fraud centering on high-interest-rate certificates of deposit (CDs). According to the SEC, in recent weeks the Stanford Financial Group has quoted rates as high as 10 percent on a five-year CD, more than twice the highest current US rate, which bankrate.com says is less than 4 percent.