WASHINGTON, DC January 31, 2020 (CMC) – The former Head of the Antigua Financial Services Regulatory Commission (FSRC), Leroy King, has pleaded guilty, for his role in connection with the Stanford International Bank’s (SIB) seven billion US dollar Ponzi fraud scheme. He will be sentenced in April.
The 74-year-old King, who was extradited, last year, from the Caribbean twin-island nation, was the last remaining defendant in the SIB scheme.
Yesterday, he pleaded guilty, to one count of conspiracy to obstruct justice and one count of obstruction of justice, for his role in obstructing the US Securities and Exchange Commission’s (SEC) investigation into SIB.
US District Judge, David Hittner, of the Southern District of Texas, accepted King’s plea and has set sentencing for April 24.
The United States Department of Justice (DOJ) said that from 2002, King, who holds dual citizenship, served as the Administrator and Chief Executive Officer of the FSRC, an agency of the Antigua government.
As part of his duties, the DOJ said he was responsible for Antigua’s regulatory oversight of Stanford International Bank Limited’s (SIBL) investment portfolio, including the review of SIBL financial reports and the response to requests by foreign regulators, including the SEC, for information and documents about SIBL’s operations.
The DOJ said that, in or about 2005, the SEC began investigating R. Allen Stanford and Stanford Financial Group (SFG) and made official inquiries with the FSRC, regarding the value and content of SIBL’s purported investments.
From 2005 through February 2009, the DOJ said Stanford, James Davis, King and others, conspired to obstruct the SEC’s investigation of SFG, SIBL and their related entities.
From at least 2003 through February 2009, the DOJ said “Stanford made regular secret corrupt payments, of thousands of dollars, in cash and gifts, to King, in order to obtain his assistance in hiding the truth about SFG and SIBL from the SEC and other regulatory agencies.”
Over the course of the conspiracy, Stanford’s cash payments to King was an estimated US$520,963.87, the DOJ said, adding that Stanford also provided King tickets to the Super Bowls in Texas and Michigan, in 2014 and 2016.
It noted that Stanford also provided King with repeated flights on private jets, Stanford or SFG entities owned, and that King later denied the SEC’s request for help, writing that the FSRC “had no authority to act in the manner requested, and would itself be in breach of law if it were to accede to your request”.
“In reality, the FSRC did have this authority and failed to exercise such, because of the payments and other benefits Stanford gave to King,” the DOJ said.
A US federal jury found Stanford guilty, in June 2012, for his role in orchestrating a 20-year investment fraud scheme, in which he misappropriated billions of dollars from SIB to finance his personal businesses. He is serving a 110-year prison sentence.
Five others were also convicted for their roles in the scheme, and received sentences, ranging from three to 20 years, in US federal prison, the DOJ said.