Stanford Investments Aren’t Eligible For Payouts: SIPC

Law360, New York (February 17, 2012, 2:55 PM EST) -- The Securities Investor Protection Corp. told a Washington federal judge Thursday that it was not required to compensate the victims of R. Allen Stanford's alleged $7 billion Ponzi scheme because his Antigua-based Stanford International Bank Ltd. was not a member of the corporation.

The SIPC, funded by the brokerage industry to cover investors who lose money in failing firms, said the U.S. Securities and Exchange Commission could not compel it to pay the fraud victims' claims because the Securities Investment Protection Act only allows the corporation...
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