Vitter wants clean slate of overseers after Ponzi victims get no help
BATON ROUGE- In another blow to people who lost around $1 billion in a Ponzi scheme, the SEC lost its appeal to recoup money for victims of R. Allen Stanford.
Stanford was convicted and sentenced in 2012 of using investors money to fund companies that went out of business. It is believed Stanford had more than a thousand accounts in the capital area.
People who lost money in the scheme have been trying to get some money back.
The SEC appeal was before the Securities and Exchange Commission, a target of U.S. Senator David Vitter who, in the wake of the scheme, has called it a broken system that is not working to protect people.
"I urge the SEC to continue its fight against SIPC and appeal this decision to the Supreme Court. However, the ruling today is exactly why we need to reform SIPC - both their members, and how they compensate fraud victims," Vitter said.
"The organization was created and tasked with the sole purpose of protecting investors and victims of fraud. The previous chairs of the board were only interested in protecting Wall Street, but the president has an opportunity to fix that now with new nominees."
Vitter has urged the president to nominate new members to the SIPC.
Stanford will likely die in prison, serving out his sentence related to the scheme.
Follow the publisher of this post on Twitter: @treyschmaltz