By Thomas Black
Feb. 20 (Bloomberg) -- Visitors leaving Antigua’s V.C. Bird International Airport for the capital of St. John’s travel down Pavilion Drive, a four-lane boulevard showcasing the presence of banker R. Allen Stanford in the Caribbean country.
Along the quarter-mile stretch sits the Texan’s Sticky Wicket restaurant, where a steak costs 100 Eastern Caribbean dollars ($37). There’s also his real-estate trust company, Stanford Cricket Ground, Bank of Antigua and Stanford International Bank, which the U.S. charged, along with the financier, with fraudulently selling $8 billion in certificates of deposit.
“One cannot ignore the fact that since he has been here he has been able to make a significant contribution to the economic well-being of the people of Antigua and Barbuda,” Prime Minister Winston Baldwin Spencer said in an interview.
The Securities and Exchange Commission’s charges against Stanford may further upset a country of white-sand beaches and turquoise water whose 75,000 residents are already suffering from a global recession. Antigua saw tourism, which accounts for 70 percent of the economy, drop 8 percent from a year ago, Spencer said, as tourists curtailed visits from North America and Europe.
Stanford, 58, who moved his first Caribbean bank to Antigua from Montserrat in the mid-1980s, became a citizen of Antigua about a decade later and was knighted by the country in 2006. He runs a lender with $8.6 billion in assets, according to the SEC, in an island economy with a gross domestic product estimated by the U.S. State Department at $1.2 billion in 2007.
Bought ‘Submission’
“He’s put more into Antigua than he took out,” said Kevin Terry, a transplanted Canadian and customer of the Bank of Antigua. “You could say he bought us into submission.”
FBI agents located Stanford near Fredericksburg, Virginia, yesterday. He hasn’t responded publicly to the charges. U.S. marshals shut down the Houston office of Stanford Group Co. on Feb. 17. A federal judge this week ordered the banker to surrender his passport and refrain from traveling outside the country until the court heard the SEC’s request for a preliminary injunction.
Stanford International Bank formed the nucleus of an investment network that sold certificates of deposit to investors from the U.S., Europe and Latin America. Venezuelan authorities took control yesterday of the financier’s local bank after customers rushed to take their money out.
As the news of the SEC fraud charges spread, depositors lined up at the Stanford-owned Bank of Antigua, which was not named in the complaint, to make withdrawals. Security guards wouldn’t allow a reporter into the institution’s office and said no one was available to comment.
Spencer pledged yesterday to protect the bank’s customers.
‘Stop the Run’
“If it means that the central bank itself has to step in, take over, stabilize and stop the run on the Bank of Antigua, I’m sure it will be done in the interest of depositors,” Spencer said in the interview.
“I say to depositors here in Antigua and Barbuda that there is no need to panic,” Finance Minister L. Errol Cort said in a statement.
Stanford left his mark on the Antiguan sports world in addition to banking. He offered $20 million in prize money for an all-stars match of Twenty20 cricket, a faster version of the sport, held at the Stanford Cricket Ground.
The field, with a green-roofed stadium seating 5,000, extends to the outside seating area of the Sticky Wicket, Stanford’s restaurant and sports bar that pays homage to the game with door handles in the shape of cricket bats. Framed photos of past teams hang on the walls among dozens of flat-screen televisions.
‘Good Man’
Some Antiguans said they were surprised Stanford was facing fraud charges.
“He’s a good man,” Desmond Marshall, 61, a retired police administrator, said during a cricket match between the West Indies and England on Feb. 18. “He helped a lot of people.”
While Hans-Bert Kupin, a real-estate developer who has lived on the island for 25 years, praised Stanford’s investments in banking and property as putting a modern face on Antigua, he said the financier could have done more for average citizens.
“I would have liked to see him get involved in more things, like the hospital and things like that, and not only just making money,” Kupin said.
Stanford described his Pavilion restaurant, located in the complex near the airport, in a 2006 press release as “a setting fit for royalty.” The wine cellar contains more than 8,000 bottles and the menu features Kurobuta pork chops with braised pork belly and tamarind sauce, according to the Web site.
In developing the Pavilion Drive complex, Stanford made use of political ties to Antigua’s previous government, Spencer said during a Feb. 18 interview after an outdoor political rally in downtown St. John’s.
Plans Blocked
Since becoming prime minister in 2004, Spencer said he blocked the banker’s plan to develop more land in another part of the island. The government asked Stanford to return up to five acres near the airport to allow for expanding a runway and building a new terminal, according to the prime minister.
“He tends to see things through his eyes, his vision for Antigua-Barbuda, not our vision,” Spencer said. “It’s a situation where it’s his vision and that’s it.”
To contact the reporter on this story: Thomas Black in Antigua at tblack@bloomberg.net
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