Louisiana’s two U.S. senators are promising to investigate the Swiss bank Societe Generale Private Banking that continues to refuse—after more than a decade—to return to victims of the Stanford Group Ponzi scheme more than $100 million in stolen funds it has been squirreling away.
Last year, the Swiss government ordered SocGen to return the money, which represents just a portion of what could be as much as $7 billion investors lost in the scheme. The senators, at the time, characterized the ruling as a potential win for Stanford victims, hundreds of whom are in Louisiana and were swindled out of their retirement savings in the mid-2000s by brokers in Stanford’s Baton Rouge offices.
But as attorneys familiar with the case predicted at the time of the ruling, the Swiss bank has continued to stonewall and so far, none of the funds has been returned.
In a letter dated Feb. 5 to the bank’s CEO, U.S. Sens. Bill Cassidy and John Kennedy, who have pursued various remedies over the past decade to help local investors recoup their lost money, suggest the bank knew about the Ponzi scheme all along and say they will be calling on regulators to investigate the bank’s practices.
“The determination of the Swiss court suggests that there are systemic problems with SocGen’s anti-money laundering practices that warrant scrutiny by our offices and applicable regulatory authorities that we will be contacting,” the letter says. “We formally invite you to speak to us both to have a more productive conversation concerning these matters.”
The letter also takes the bank’s CEO, Slawomir Krupa, to task for failing to meet with them personally, sending lawyers in his place instead.
“Please be assured that the absence of SocGen leadership, along with the unsatisfactory and disingenuous responses we received … will only encourage our offices to continue its zealous investigation of SocGen and other financial institutions that enabled Allen Stanford and his entities to defraud investors of nearly $7 billion,” the letter reads.
While the letter sounds threatening, tough talk from the Louisiana congressional delegation hasn’t made any difference so far in the case, which is playing out on multiple fronts with equally disappointing results.
A separate class-action suit filed locally on behalf of some 900 mostly Baton Rouge-based victims of the Stanford Group is currently on appeal, following a ruling last year effectively throwing the case out of court.