All language subtitles for American Greed s06e17 Allen Stanford The Dark Knight.eng

In this episode of American Greed.
Hello, I'm Alan Stanford.

A financial predator of epic
proportions.

Alan Stanford and his shocking $7 .2
billion fraud.

He's an absolute crook. He's a thief.
And created a blueprint to build people

out of billions of dollars.

For two decades, Stanford runs an
international Ponzi scheme, selling

certificates of deposit from his
offshore bank on the island of Antigua.

Stanford International Bank from day one
was a facade.

It didn't exist.

It was a Hollywood set. They weren't
investing the money, like Stanford told

investors. And it's those investors,
more than 20 ,000 of them, who foot the

bill for Stanford's lavish lifestyle.

Alan Stanford, at his peak, was a
billionaire.

He was one of the richest men in the
world. He used the money on yachts and

private jets, had homes around the
world, and also to prop up his empire.

Billions of investor dollars gone. To
lose $1 .3 million by someone that

absolutely stole the money from me is
just horrific.

Alan Stanford is a sociopath.

We have real assets, real people.

a real group of companies, and this was
no Ponzi scheme.

June 11, 2008, Lord's Cricket Field,
London, England.

American billionaire Alan Stanford
stands proudly at the apex of his

The banker is on the Forbes 400 list.

He's been knighted Sir Alan Stanford by
the Caribbean island of Antigua, where

he lives.

And strangely enough, for a man who grew
up in Texas, Stanford is considered the

world's number one promoter of the game
of cricket.

Stanford was all about creating this
mystique, and cricket was the perfect

vehicle for that.

The defining image of Stanford was
landing in the middle of the most famous

cricket field in Britain in his personal
helicopter with a plexiglass box full

of $20 million in cash that would go to
the winner of some cricket match. This

was very much the type of image that he
liked to project.

But the fun's over just eight months
later when the Securities and Exchange

Commission raids Stanford's Houston
headquarters, shutting down operations

the U .S. and 13 other countries.

Tens of thousands of investors will
learn that their life savings have been

squandered.

If you look at Alan Stanford as a
person, what you have to remember first

foremost is he's a Texan. I happen to be
one too. He's a classic.

Texas archetype, the swashbuckling,
often big, muscular entrepreneur.

Vanity Fair correspondent Brian Burrow
knows the lay of the land.

He grew up near Stanford's hometown.

He grows up in this kind of run -down
little town, Mahea, south of Dallas. His

dad has a little insurance agency. His
mom is a housewife who writes for the

local paper.

Stanford graduates from Baylor
University, marries, and wastes no time

a business.

Stanford's genius was that he turned
this one little health club on Lake Eyre

Boulevard in Waco, Texas, into something
called Total Fitness.

And it was the first gym in Central
Texas to bring out these newfangled

weight machines.

My family lived there at the time. Total
Fitness was where everybody went to

work out.

It's where you went to be seen.

This location at one time was Alan
Stanford's Total Fitness Center.

Former gym member Doug Birdsong knew
Alan Stanford back when everyone called

Big Al.

I used to work out here some with Alan,
and you have to remember that Alan is a

mammoth of a man. At the time, he was 6
'5", and probably weighed 330, 340.

According to Birdsong, Stanford was
arrogant in his dealings with employees

even customers.

He was the biggest, he was the best, and
he was the boss.

No one much cared for him, but he was
the owner.

He was somebody who wanted things done
when he wanted it, didn't seem to have a

whole lot of regard for the people who
would work around him. He was a tyrant

work for, but he also had this charisma.
He had this ability to pull people in,

and that's how he achieved what he did.

You know, the amazing thing about
Stanford is here he is, 28, 29 years

got a little string of three or four
health clubs in Central Texas.

But to look at the guy, you'd think he
was a mogul. He's driving a white Jaguar

through the streets of Waco, Texas at
age 30.

And he gets a helicopter, apparently, at
least. You know, there's this total

fitness on the side. So the guy looks
like, you know, a little Texas Bill

It's clearly...

The image of success that he wanted to
broadcast. It helped bring in money when

he tried to raise it. It certainly
helped to bring in customers.

Until it didn't.

In the early 80s, the Texas oil business
goes bust.

Total Fitness loses members.

And Stanford faces bankruptcy.

One day we showed up and the doors were
locked. There was a sign on the door. It

said closed.

With $13 million in debt, it's time for
Stanford to throw in the towel. He loses

his string of health club to bankruptcy.

But Stanford lands on his feet, becoming
an entrepreneur in the Texas energy

business.

Though it's a more elemental form of
energy, as Doug Birdsong finds out when

responds to an ad for firewood.

And here came Allen driving a truck with
a cord of firewood on the back.

So he was still in town.

But he was not in the banking business,
and he was not in the gymnasium

business. He was in the firewood
business, which is where he should have

But the restless dreamer has bigger
plans.

But I guess the question for us now and
for Stanford then is, what type of

business does the ownership of a
bankrupt line of health clubs actually

Well... The answer turned out to be
Caribbean banking.

The volcanic island of Montserrat is a
British territory.

You wouldn't know by looking at it, but
Montserrat is also a banking center.

With 350 banks on this tiny island,
there is one for every 30 residents.

Many banks exist only on paper.

Some are domiciled in bars, and
regulation is notoriously lax.

As a result, a lot of people that went
to Montserrat were people who could not

get banking licenses anywhere else.

I talked to one money laundering expert
who said, look, the only reason to open

a bank on Montserrat was if you had
fraud in mind. If you were legitimate,

went somewhere else.

Amazingly, Alan Stanford, former health
club mogul of Waco, doesn't come here to

start a bank.

He lands on Montserrat as a scuba
instructor.

One of the great mysteries of Stanford's
career is how he got his start in

Caribbean banking. You know, it was said
that he started this initial bank on

the island of Montserrat with something
like $6 million.

Nobody has a clue where he got $6
million or even if he had $6 million.

But this much is known.

Stanford buys a storefront calling the
business Guardian International Bank.

He hangs a painting of his grandfather
Lotus in the lobby and tells people

falsely that the bank was founded in the
1930s.

Initially, Stanford targets wealthy
Latin Americans worried about the

of their governments.

Many of these rich Venezuelans and
Colombians seek an offshore haven.

He placed small ads, some with
attractive women, in scores of Latin

newspapers.

And the key was he advertised deposit
returns, two points over whatever was

being advertised in the U .S.

And nobody understood quite how he would
do it. And he would always have this

kind of blather about, well, we're a
very lean company. We don't pay a lot of

taxes. Montserrat is low cost.

So we're just leaner.

There's no magic to investing. It's just
hard work. It's a lot of diligence.

And it's just staying the course.

By 1990, Stanford's Guardian Bank touts
$100 million in its accounts.

But around this time, the winds of
fortune shift when the FBI and Scotland

suspect drug money is coursing through
Montserrat's banks.

This led to a two - or three -year
investigation in which scores of these

banks called Instabanks were thrown off
the island. And ultimately, while it was

never proven that Stanford himself was
taking drug money, his bank license,

was revoked in 1991.

It's a major defeat for Stanford.

But just like before, when he lost the
health club chain, Alan Stanford will

come back bigger and badder than ever.

Up next on American Green.

Stanford reinvents himself with brash
Texas bravado.

He ultimately managed to buy a new bank
on an island that was every bit as

corrupt as Montserrat.

In 1991, Alan Stanford's adventure in
Caribbean banking is sinking fast.

The island of Montserrat, under pressure
from an international money laundering

investigation, revokes his banking
license.

Stanford needed a new place to go, and
so he goes 20 miles away. The nearest

island is Antigua, and Antigua welcomed
him with open arms.

This is the heart of it all.

CNBC senior correspondent Scott Cohn
covers the Stanford story and follows

investigative trail to Antigua.

The island paradise is plagued by
poverty and has a history of corruption.

Antigua needs investment. The tourism
industry is building, but it needs

investment. And they weren't necessarily
looking around to see what happened the

next island over.

Alan Stanford comes in and he has money.
He wants to set up a bank.

In 1991, Stanford International Bank is
born.

He targets those rich Latin Americans
looking for safe investments.

His rise is meteoric.

He became the largest private employer
on the island, and Antigua became, in

some ways, a center for offshore
banking.

Of course, it also became the heart of
Alan Stanford's empire.

The pride of that empire is called the
Stanfordville Complex. It's all Stanford

right there. It's the first thing you
see when you come out of the airport in

Antigua.

He had his fingers in every part of this
economy. He owned a newspaper.

He owned an airline.

In the years to come, the Antiguan
government will rack up $87 million in

from Stanford.

Antigua becomes his personal domain.

He wielded enormous power in Antigua.

This man had almost single -handedly
shaped the Antiguan economy.

And by 1994, Stanford International
Bank's assets skyrocket to $350 million.

Stanford opens branches in Venezuela,
Peru, and Panama.

But he isn't content to stay in the
southern hemisphere.

In 1995, with an eye on the much bigger
U .S. market, he establishes the

Stanford Financial Group in Houston.

It allowed him to sell in the U .S.,
which was a market that he hadn't really

tapped before.

It allowed him to reach all of these
people that were looking for this

safe investment.

The company offers a variety of
financial products, bonds, mutual funds.

But ironically, the hard -driving Texan
makes his name pushing an investment

vehicle that's about as conservative as
it gets, a product synonymous with

safety.

The certificate of deposit.

This guy was a salesman. He knew what
buttons to push, like any good salesman.

He knew that people wanted to be
wealthy, wanted to save their money,

their money, grow their money.

As they say, the closer you get to 60,
the more conservative you need to be.

And that's what I thought I was doing.

Doug Birdsong used to lift weights with
Alan Stanford back in the 80s when the

banker owned Total Fitness.

The last time they met, Stanford was
starting over as a firewood salesman.

So when Birdsong's broker in Austin,
Texas, tells him about some CDs being

offered by a company in Houston.

And he said the company's name is
Stanford.

Birdsong doesn't make the connection
that Stanford is Big Al from the gym.

My financial advisor brought me a
proposed portfolio and said this is what

might do. It isn't that different than
what we currently have.

with a few tweaks here and there.

For 20 years, Birdsong owned and
operated a software company serving the

care industry.

Now he's downshifting into retirement.

Birdsong's advisor recommends a
certificate of deposit from Stanford.

It offers a return 1 .5 % higher than
most other CDs.

To Birdsong, it's a no -brainer.

I know what a CD is. I know exactly what
a CD is.

And that sounds safe to me. So that's
what we're going to do. And that's what

did.

In Houston, Cassie and Phil Wilkinson
are in the enviable position of being

to retire early.

My husband and I never doubted our
ability to earn or our ability to save.

But we didn't have any confidence in
ourselves.

for investing, because I'm a designer
and he's in the oil industry.

Phil worked for Aramco Oil for 28 years
and has a sizable retirement fund

through the company's 401k plan.

The Wilkinsons meet their financial
advisor, a broker for the Stanford

craft an investment strategy.

He recommended that we pull out of an
annuity a large sum of money, hundreds

of thousands of dollars, and invest it
in a Stanford CD.

And the stock market was booming, and
the rates were, you know, the returns

big. And so I asked him, why would we
want to do that when we're making so

in the stock market? And he said,
because it protects you, it's

safe.

For investors nearing retirement, like
the Wilkinsons, it makes perfect sense.

And if anyone wonders how Stanford is
able to provide above -market returns,

there's a ready explanation.

The interest rate was higher, but that
was easily explained, that there was

one bank.

They didn't have a lot of concrete on
the ground, as our advisor said.

They didn't have tons of employees to
pay.

It was one bank that was well managed,
and it was just a couple of points

than the prevailing rate.

It was believable. That's all I can say
is that it was simply believable.

Up next, Alan Stanford is transformed
into Sir Alan. That really gave him even

more of a sense of just being the
international man of mystery.

And Stanford's reckless spending knows
no limits.

All he was doing was putting our money
in his pocket, buying airplanes, buying

homes in Florida, having them destroyed,
and building new ones. I consider what

Alan Stanford did to be far beyond
greed.

Hover round takes me where I want to go,
where will it take me?

On the Caribbean island of Antigua, Alan
Stanford's bank thrives in its new

location. Writer Brian Burrow traces
Stanford's ascent for Vanity Fair.

It's just stunning how successful this
bank was. It grows from $350 million...

to $3 billion in 2004.

And Stanford owns it all. You know, at
the top of his rise, Stanford was worth

an estimated $2 .2 billion, and he was
in the Fortune 400.

No longer a firewood salesman or a
failed health club owner from Waco.

By 2004, Alan Stanford is a world -class
tycoon.

Everything that Alan Stanford did was to
exude wealth, to make people feel good,

to make people feel like they were
investing with a self -made billionaire

was trustworthy. You felt like you were
investing in something substantial, when

in fact what you were investing in was
Alan Stanford's lifestyle.

He liked to live large mansions in South
Florida, homes in London and elsewhere.

He liked playing the part of what he
was, a big swashbuckling Texas guy. He

liked landing on cricket fields with
helicopters.

Stanford spends in one three -year
period a staggering $100 million on

including helicopters and private Lear
jets.

His Houston headquarters gleamed with
the finest materials.

Marble, mahogany, gold, brass, a
sweeping staircase.

The building exuded wealth.

His office was grandiose. It was bigger
than a lot of New York City apartments.

Big desk in the corner. He had his own
private bathroom with a shower. And he

also had his own private entrance so he
could come and go from the building and

wouldn't have to deal with the riffraff.

Of course, if you're Alan Stanford, one,
two, or even three residences aren't

enough.

He owns mansions in Houston, Antigua,
St. Croix.

He buys a small island for $63 million.

Then there's the elegant Ticliff Castle
in Coral Gables, Florida.

It's an enormous 18 ,000 square feet
with 57 rooms, a tower, and even a

moat.

Stanford lives there for a year, tires
of it, moves out, and then demolishes

property.

But maybe there's a good reason for all
the homes.

The high -flying Texan is notorious for
his roving eye.

He liked women. He was married and he
had at least three different women that

know of who had five children. So, you
know, he spread his money. He spread a

lot of things around.

Throughout his career, Alan Stanford has
carefully crafted a persona, even if it

requires rewriting history.

In his Montserrat days, Stanford falsely
claimed that his grandfather, Lotus,

founded a bank.

Now Stanford is at it again.

this time on a much bigger scale.

Like anybody in his position, Stanford
wanted to highlight his good works and

his connections, and clearly he shared a
name with a very famous university in

Palo Alto, California.

He claimed he also shared lineage.

The billionaire banker donates $2 .5
million to Stanford University to

co -founder Leland Stanford's home.

Well, Stanford University didn't take
too kindly to this and actually sued

Stanford for trademark infringement,
said that there was no family

and asked him to cease and desist from
using the Stanford name.

But this is a rare misstep.

By all appearances, Stanford's fortune
continues to flourish.

In 2006, he attains even greater
notoriety when he's knighted by the

of Antigua.

That, in many ways, was the capper. And
from then on, he could sign all of his

letters to shareholders as he did Sir
Alan Stanford.

That really gave him even more of a
sense of being the international man of

mystery. Coming up, Stanford's band of
brokers preys on victims.

I had never heard of Stanford Financial
Group, but my broker was going there, so

that was good enough for me.

And what happens when one financial
advisor suspects fraud?

Well, I had not been at Stanford but
maybe a month when the first red flag

appeared.

Mansions, airplanes, yachts. The
international banker now known as Sir

Alan Stanford.

is burning through tens of millions of
dollars every year, putting intense

pressure on his Stanford financial group
to remain profitable.

To reel in more investors, Stanford
expands his empire, opening more than 30

offices across the United States and
building an army of brokers.

He was trying to create...

a real financial services business. So
he would hire these brokers away from

established firms.

In retrospect, what he needed from them
was their client list, was, you know,

these people could bring in clients, and
indeed they did.

I had met my broker numerous years ago.
I had known him for a long time. We

became very close, and I had followed
him from firm to firm.

In 2005, in Houston, Sandra Dorrell's
broker moves to Stanford.

and tells Durrell he's taking a select
group of clients with him.

He'd like her to be one of them.

I had never heard of Stanford Financial
Group, but my broker was going there, so

that was good enough for me.

Durrell is sitting on a windfall, having
just sold an office furniture business.

Her broker recommends she buy Stanford's
Bank of Antigua certificates of

deposit. They pay a percentage point or
two more than CDs from domestic banks.

And I asked why, and he said because
they're an offshore bank, they don't

the taxes that they have to pay in the U
.S., and they can get away with a

little bit higher returns.

And he said, you'll like the returns.
They pay like clockwork. It's a

wonderful avenue to make money.

The total amount of the CDs that I
purchased over the years was $1 .3

That is a lot of money to someone like
me.

Darrell is a single mother with a
daughter to support, and she's been

with Caroli's disease, a very rare and
life -threatening condition that often

destroys the liver and kidneys.

Shortly after I found out about the
disease, I realized that I would need a

liver and kidney transplant.

I knew that I would need a lot of money,
and that's what my CD money was for. It

was going to mature about the time that
I would be needing it. I wanted to make

sure that it was safe.

Her broker reassures her, asking what
could be safer than a certificate of

deposit.

But inside the walls of Stanford
Financial, some brokers have an uneasy

Well, I had not been at Stanford but
maybe a month when the first red flag

appeared. In Houston, broker Charlie
Rall has just joined Stanford after

many years with some of the biggest
names on Wall Street.

He quickly begins to doubt the move.

It seems the Securities and Exchange
Commission is taking a hard look at

Stanford, specifically his flagship
certificate of deposit from Antigua.

The SEC has even sent FedEx packages to
all of Stanford's CD investors, asking

them a long list of questions.

So these clients picked up the phone
naturally and called their advisor to

what in the world is this? Why is the
SEC asking me these questions?

Did I buy something bad? Is there
something wrong here? And they were

concerned.

Stanford hires a law firm and tells his
regiment of brokers that everything's

okay. But it quickly becomes apparent to
Charlie Rall that it's not.

In approximately June of 2006,

All of the assistants were pulled
together in a conference room and told

they needed to go through all of the
files that contained information about

bank CD, the client files that had
purchased CDs.

And the staff was told to go through
every file and clean out the files.

Rawls says the assistants are told to
destroy every handwritten letter, every

post -it note, everything except the
official documents involving the sale of

the Bank of Antigua CDs.

That was very strange, and many of the
advisers were talking about that. What

going on? Is there a lawsuit?

Is the SEC asking for these things? We
were concerned. That was a big red flag

to me because if indeed there was an
open investigation or inquiry, purging

files and the possible destruction of
documents was a tremendous no -no.

Ironically, after ordering employees to
destroy files, Stanford then sends a

memo reminding them to save everything.

It was a CYA memorandum to, in my mind,
really cover up that

purging of files that had happened a
month or so prior.

What is Sanford trying to cover up?

Raw believes it has something to do with
how the CDs are marketed to investors.

Glossy corporate videos exaggerate the
solidity of Stanford investments.

Our banks offer innovative products,
security, and world -class service. It

obvious to me that if you pull out the
notes, the sticky notes, the letters,

anything other than the official
documents, you couldn't prove how the CD

sold. So that's why the documents needed
to be purged and cleaned out. Then they

made copies and sent them to somebody.

It was later we learned that that
somebody was the SEC.

Next on American Greed, two brokers risk
potential ruin when they attempt to

take Stanford down from the inside. When
we drove to Fort Worth to turn over

these documents, I spent more time
looking in my rearview mirror than I did

looking through the windshield.

Paranoid, maybe?

Watch more of Alan Stanford's corporate
video at AmericanGreed .CNBC .com.

From the outside, billionaire banker
Alan Stanford seems to radiate success.

But inside Stanford headquarters in
Houston, the halo effect has grown

Some of Stanford's brokers, including
Mark Tidwell, worry that Sir Alan is

cooking the books.

There were a lot of after -hour phone
calls, meetings and discussions about,

know, what is really going on here? You
know, there's a disclaimer on it. Yeah.

The breaking point for Tidwell and
Charlie Wall comes when Stanford asks

staffers to destroy documents.

They believe it's a cover -up involving
Stanford CDs.

We're very confident that Stanford is
doing things wrong.

You know, they're not reporting things
correctly.

They're manipulating data.

They're cooking the numbers. Everything
became a gray area. What is right? What

is wrong?

What you can report, what you should
report, but what you can maybe disclaim

away. I mean, there were a lot of issues
here that kind of cut across a lot of

different areas, mostly very technical,
but very real.

All we wanted to do was leave that
place, get out of there, and get our

out safe and sound.

Fearing for their clients' money and
their own futures, Rall and Tidwell

in December 2007.

Stanford responds by suing them for
breach of contract, and he tries to claw

back signing bonuses that had been given
to the two brokers.

They knew they could steamroll us and
beat us down and win. We knew that if

we're going to have any chance of
survival, that we needed to bring this

the public domain.

We needed to go to every regulator we
could think of. We needed to go to the

enforcement agencies that would listen.

Months earlier, the two brokers had
begun to compile evidence of

at Stanford Financial.

They bring the documents to the
Securities and Exchange Commission.

Among other things, the documents show
that Stanford has vastly overstated the

performance of his mutual funds.

Rall and Tidwell believe that this
information could put Alan Stanford out

business for good.

When we drove to Fort Worth to turn over
the documents, Mark and I went a

different route.

I spent more time looking in my rearview
mirror than I did looking through the

windshield.

Paranoid, maybe.

I remember conversations with Charlie.
You know, you turn on a light switch and

it sounded funny, or you started your
car and it didn't really sound the way

was supposed to sound. We were scared.

We knew that it was the entire Stanford
Empire.

It'd be taken down with what we were
doing.

Federal investigators begin to pour
through the documents.

They find that marketing materials
misrepresent the security of Stanford's

implying the CDs are insured by Lloyds
of London when they are not.

They also discover that Stanford Group
lied about the performance of mutual

funds.

When we left Stanford, we didn't know
how bad the fraud was. That began to

reveal itself.

Over time, we knew they were lying about
a lot of things. We never dreamed it

was a Ponzi scheme.

At that point, not only I had never
heard of Stanford, I had never heard of

billion Ponzi scheme. I thought that was
kind of crazy.

Paul Pelletier is a former assistant U
.S. attorney in Houston.

In May 2008, he gets the Stanford case
from the SEC, which believes Stanford's

file is a criminal matter.

And as you look at this, you can see,
like everything that's Stanford, it has

the trappings of legitimacy.

But when you just scratch the surface or
look behind it, there's really nothing

there.

There are many warning signs of fraud.

The bank's board of directors is
composed of Stanford's relatives and

-men. Few have any experience in
financial services.

And Stanford himself struggles to
explain how his investments work in this

used to lure investors.

We have the advantage of always placing
our clients' interests above that of any

shareholders. When you see him talking
to people, it's always pablum.

When you look at it, it's just words.
Because when people are asking him

questions about the investments, he
always reverts back to the problem. We

the landscape with eagle vision, seeing
opportunities where others cannot.

Opportunities for new markets, new
investments, and new ways of enhancing

financial security.

Up here, the possibilities are endless
because potential has no boundaries.

Pelletier begins to fear that tens of
thousands of investors may have already

lost their life savings.

But how does he build a criminal case?

Pelletier gets a break when Jim Davis,
Alan Stanford's right -hand man since

early days on the island of Montserrat,
agrees to tell all in exchange for a

reduced sentence.

Trust and integrity are indispensable.

That thought of personal relationship.

is a cornerstone to establish a lifelong
rapport.

What Jim Davis said from the beginning,
the books were cooked. From the

beginning, they were making up numbers
as to what the profitability of the bank

was from his first day on the job.
That's what his job was, a CFO. And he

continued to do that from 1987 or 88 all
the way until 2009.

It was sort of a symbiotic relationship.

Stanford would look to Davis to make the
numbers sing, and Davis would look to

Stanford for the approval and to
continue to finance his lifestyle.

Up next on American Greed, Stanford's
former ally tells the shocking story of

bizarre ritual between Sir Allen and
Antigua's chief banking regulator,

with blood and bribes.

Each of them cut their fingers and mixed
their blood at the time they arranged

the deal.

Allen Stanford's former right -hand man,
Jim Davis, is cooperating with the

Department of Justice, providing a
window into one of the biggest frauds in

history.

In 2009, Davis tells former prosecutor
Paul Pelletier that in Antigua, Stanford

could do whatever he wanted.

In a shocking revelation, Davis says
Stanford bribed the chief banking

of the island and used a bizarre ritual
to close the deal.

They sealed this bribery scheme with a
blood oath and that each of them cut

their fingers and mixed their blood at
the time they arranged the deal to it.

to engage in this bribery scheme, and
that they were now blood brothers so

could never violate that oath by
exposing this bribery scheme to anyone.

And with the bank's regulator looking
the other way, Pelletier says Alan

Stanford had no constraints.

He siphoned investor money into his own
personal Swiss bank accounts.

The amount of money that he spent...

through these slush funds was
astronomical, but nobody knew that he

it. To cite one egregious case, Stanford
spends $12 million of investor money

lengthening his yacht, the Sea Eagle, by
just six feet.

To top it off, the renovation actually
diminishes the value of the boat.

The fact that a person would use
investor money to increase the size of a

by six feet, speaks volumes as to where
his head is at in terms of whether or

not he really cares about the investors.

But sadly, the $12 million spent on the
Sea Eagle is a speed bump compared to

the Mount Everest of theft Pelletier
will eventually uncover.

What we learned is that ultimately he
was siphoning off money in loans to

himself that he would remove from the
depositors' CD holdings.

And these loans ultimately amounted to
approximately $2 billion, which were

never revealed to investors.

On February 17, 2009, the headquarters
of Stanford International Bank becomes

a crime scene.

The SEC shuts down Stanford's operation
in Houston and across the country.

Thousands of investors watch in horror.

No one was more surprised than I was the
day I woke up and found out that Alan

Stanford was actually the person that I
had known since I met him as

Big Al.

That was a very shocking day.

And my first reaction was to come home,
pack a suitcase, grab some cash,

hop on a plane, and fly to Antigua.

It was just a panic situation.

I immediately go to my bank account and
realize I have $200 in my checking

account. I have no money. I had no
savings other than everything that was

Stanford Group Companies.

I am dead broke.

And while victims soon learn their money
has vanished, Stanford apparently has

lost none of his swagger.

And at this point now, he claims he's
going to stay and fight.

He said he's knocked back on his heels a
little bit, but now...

Now he's going to fight this thing.

He claims that it was the government, it
was the FTC that destroyed his

financial empire. It wasn't a Ponzi
scheme that fell apart.

It was because the government moved in
with its heavy hand and knocked the

thing down.

In a rare and exclusive interview,
Stanford meets with CNBC senior

Scott Cohn.

Madoff comes along.

Well, they need somebody to make an
example out of.

In this case, to hell with the investor.

Let's go after this thing. Let's just
carve it to pieces, bludgeoned it, and

leave it worthless.

So they screwed up with Madoff, so they
came after you? Is that what you're

saying? You make your own judgment
there.

You make your own judgment there.

Madoff was a true Ponzi scheme.

We have real assets, real people, a real
group of companies,

and this was no Ponzi scheme.

In June 2009, Alan Stanford is charged
with fraud, conspiracy to launder money,

and conspiracy to obstruct justice.

He's arrested at his girlfriend's house
in Virginia.

The case drags on for more than three
years and is filled with drama.

Stanford is hospitalized for heart
trouble.

He claims he's addicted to pills and is
mentally unstable.

He's beaten up and bloodied in prison.

He even bloodies himself.

He bit his tongue and kept spitting up
blood in court.

And it was unusual to me, but he was
trying to portray himself as if he had

internal bleeding. But in reality, he
had bit his tongue and was spitting that

blood in a cup in court.

Stanford's life has been a lie.

and a ploy to deceive people.

And he didn't change that once he was
incarcerated.

Finally, in January 2012, the trial
moves forward.

Alan Stanford pleads not guilty and
tries to blame everything on Jim Davis.

But the evidence against Stanford is
overwhelming.

On March 6, 2012, Stanford is found
guilty.

The jury convicts him of 13 out of 14
counts of fraud, money laundering, and

obstruction.

In June 2012, American Greed is on
location in Houston for Stanford's

hearing. Victims, wearing black in
solidarity, gather outside the

Cassie Wilkinson steps up to speak out
against Stanford.

The sentencing for crimes like this has
become so big and so long that they're

comparing it to economic homicide. And
really, that's what it is. Someone

murdered the life that I knew, that I
worked hard for.

We were not born with money. We earned
every single penny.

Judge David Hittner sentences Stanford
to 110 years in prison.

Though it's less than the maximum
sentence, many victims are satisfied

Stanford will spend the rest of his life
behind bars.

Well, anything beyond about 30 years
would have been just to send a message.

think it was a good, strong sentence.

110 years, I think, was an appropriate
sentence.

Naturally, I would have loved to see the
230 that the government requested, but

I think 110 sends a good message.

Sandra Dorrell invested $1 .3 million
with Stanford so she could have peace of

mind as she fought a serious illness.

She has since had a successful liver and
kidney transplant paid for by insurance

and considers herself lucky to enjoy
good health.

But any hope for financial security is
gone.

I wake up every day thinking about
money. I go to bed every night thinking

money. And now it's not there, and I
have to worry about it every day of my

life. How am I going to live the rest of
my life without that money?

Cassie Wilkinson and her husband Phil
lost a six -figure portion of their

retirement. My husband has had to go
back to work. We've put our house on the

market. It was our life that was stolen,
a life that we worked really hard for.

None of it was given to us. And Alan
Stanford used it like it was pocket

To lose $1 .3 million by someone that
absolutely stole the money from me is

horrific.

The evidence showed Alan Stanford was a
man that survived on two things, ego and

greed. Lying to people who you are
taking money from for the sole purpose

promoting your ego and promoting your
sociopathic lifestyle.

That's the definition of greed.

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