U.S. senators from Louisiana urged Toronto-Dominion Bank to compensate victims of R. Allen Stanford’s Ponzi scheme over the bank’s “knowing assistance” in his $5 billion fraud, WSJ Pro Bankruptcy reported. Sens. John Kennedy (R-La.) and Bill Cassidy (R-La.) accused TD Bank in a Friday letter of abandoning small investors who lost their nest eggs when Stanford International Bank Ltd., a TD Bank customer, was exposed as a fraud and collapsed in 2009. Despite being named in long-running lawsuits in the U.S. and Canada, TD Bank and other Stanford financial partners haven’t reached settlements with court-appointed liquidators charged with digging up money for victims. The senators alleged that TD Bank “aided and abetted” Stanford’s banking outside the U.S. and knocked the institution for expanding its U.S. footprint in the years since while holding out on settling litigation and paying restitution. Stanford’s U.S. clients were largely clustered in Texas and Louisiana, though his far-flung financial empire also stretched to Latin America, the Dutch Caribbean and Switzerland. “We demand that TD Bank stop its obstructionist conduct, engage in a meaningful effort to put an end to this decade-long debacle and provide restitution to the Stanford victims without further delay,” the senators said in their letter to TD Bank Chief Executive Greg Braca. “Regulatory intervention should not be necessary for Stanford’s victims to receive the justice they deserve.” Stanford investors since 2009 have gotten back a fraction of what they lost and far less than the recoveries for victims of Bernard Madoff’s Ponzi scheme, which collapsed months before Stanford’s.
