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Antigua's lower house backs Stanford land seizure

Legislators in Antigua and Barbuda gave initial approval to a measure that would let the government seize property and assets owned by embattled Texas billionaire R Allen Stanford.

business Updated: Feb 27, 2009 12:55 IST

Legislators in Antigua and Barbuda gave initial approval Thursday to a measure that would let the government seize property and assets owned by embattled Texas billionaire R Allen Stanford.

Parliament's lower house passed a resolution to give Prime Minister Baldwin Spencer's administration the power to seize the roughly 250 acres (100 hectares) of land on Antigua that belongs to Stanford's beleaguered financial empire on news of a US fraud investigation of the financier and three of his companies. The move signals the start of what is likely to be a messy, multinational fight over Stanford's assets amid allegations that he peddled sham promises of high investment returns as part of an $8 billion fraud scheme.

Antigua is hoping to contain damage to the local economy as US investigators probe the alleged investment fraud. The tiny Caribbean nation also does not want to be seen as caving in to the US, which it has previously accused of crippling its gaming industry by banning Americans from placing online bets.

The measure is expected to gain final approval on Friday in the Senate, which is dominated by Spencer's party. Parliament was dismissed ahead of March elections but reconvened because of the Stanford affair.

Before Thursday's vote, Finance Minister Errol Cort told lawmakers that a seizure of Stanford property is urgent because it will help the government avoid any legal battles with the US court-appointed receiver over the local assets.

Cort accused the receiver of sending letters "to every commercial bank in our region advising if they have accounts in respect of anything to do with Stanford, they must freeze." Ralph S Janvey, whom the US District Court in Dallas named as the receiver to take control of the assets of Stanford's businesses, did not immediately respond to requests for comment. Members of the opposition Antigua Labor Party objected to the measure, saying the government is trying to take action against the Caribbean country's biggest investor even though he has not been charged with any crime.

"I believe that this particular resolution is certainly premature," lawmaker Gaston Browne said. "It is coming at a time when Stanford is not even being indicted, and I believe that this resolution should be deferred until a later time. Opposition members walked out of the legislative session in protest.

US authorities accuse Stanford, 58, of defrauding investors by disguising his investments as relatively safe CDs with above-average returns. He was served legal papers by FBI agents and ordered to surrender his passport.

Stanford's businesses on this former British Caribbean colony, where he had been knighted, include two restaurants, a newspaper, cricket grounds, a development company, a three-branch local bank and the headquarters of his offshore bank.

Spencer, whose party came to power in 2004, has defended Antigua's banking rules and credits Stanford for creating some 2,000 jobs, but asserts that his predecessors allowed him to acquire "dangerous" influence and prime real estate.

On Thursday, Attorney General Justin Simon told legislators the government is particularly concerned about safeguarding parcels of land abutting Antigua's airport.

Former Prime Minister Lester Bird, whose party was in power when Stanford brought his offshore bank here from Montserrat in 1990, expressed concern over the government's handling of the case of one of Antigua's most prominent islanders _ who also holds citizenship. "I see the government is seeking to use (the SEC probe) as an opportunity to take back all the lands from Mr Stanford. I want to be sure that in the process of doing that, they don't throw out the baby with the bathwater," Bird told The Antigua Sun. Stanford owns the newspaper.