Cassidy Urges SEC to Appeal Circuit Court Stanford Ruling

Press Release

Congressman Bill Cassidy sent a letter urging the Securities Exchange Commission (SEC) Chairwoman Mary Jo White to appeal the decision made by the D.C. Circuit Court of Appeals that victims of the Stanford Ponzi Scheme are ineligible for compensation from the Securities Investor Protection Corporation.

The D.C. Circuit court used the argument that Stanford Group investors loaned their savings to the affiliated Stanford Antigua bank, thereby giving up their right to compensation in case of a Ponzi scheme. However, that directly contradicts decisions made by the Second, Tenth and Eleventh Circuit Courts in similar cases. Additionally, the SEC mistakenly misrepresented assertions made by Stanford victims in their affidavits, which were used by the District Court to rule in SIPC's favor. Victims deserve a fair judicial review of their individual claims.

Dr. Cassidy offered the following statement:

"Stanford Victims' financial futures have been damaged by the Ponzi scheme, and now threatened by SEC inaction. Since similar cases have ruled in victims' favors, I urge the SEC to appeal the U.S. Court of Appeals ruling. The Stanford Ponzi Scheme devastated many Louisiana families, we must do all we can to help these families achieve justice."

Additionally, Angela Shaw Kogutt, Director and Founder of the Stanford Victims Coalition, offered the following statement:

"I want to thank Dr. Cassidy for his leadership in pursuing justice for Stanford victims not just in Louisiana, but in 46 states across the country. Stanford victims have suffered for more than five years, and Dr. Cassidy's support has never wavered as he fought for our rights from the inception of the government's allegations against Allen Stanford. SIPC has looked for every way out of protecting the victims of its own member firm, and instead of complying with the federal government's authority, SIPC has opted to protect Wall Street firms rather than Main Street investors who were deceived by the assurances that came with the (mandated) display of SIPC's logo at every Stanford Group Company office and on all communications with the firm. If we can't rely on being protected when the owner of a registered brokerage firm steals our savings in a Ponzi scheme, no investors can ever rely on the safety net Congress intended SIPC to provide. I urge the SEC to join Dr. Cassidy in pushing for us to be fairly compensated just like the victims in other similar cases."

Successfully pushed the SEC to appeal the original July 3, 2012 District Court ruling on SEC v. Securities Investor Protection Corporation (SIPC), which denied Stanford victims compensation

Proposed the "Improving SIPC Act" with Rep. Ted Deutch (D-FL) on February 28, 2013, which would allow individual Stanford victims to consider offers from SIPC aimed at partially reimbursing their losses.

Cosponsored the "Restoring Main Street Investor Protection and Confidence Act," which would amend the definition of "customer" to ensure that investors who deposit cash to buy securities can still be covered by SIPC protection, even if the money is initially given to a firm that is not a SIPC member. It would also give the SEC more authority to force SIPC to act without the need for court approval.

Sent a bi-partisan letter with 9 other lawmakers on July 11, 2014 to President Obama, urging him to appoint people to SIPC who would treat Stanford victims and other defrauded investors fairly.

Sent a bi-partisan letter with 26 other lawmakers on November 22, 2011 to SIPC Chairman Orlan Johnson, urging him to act quickly to reimburse Stanford victims.

Sent a bi-partisan letter with 11 other lawmakers on August 31, 2009 to the SEC to urge them to release information regarding their investigation of the Stanford Financial Group.

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