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Swiss return $200m as part of Stanford fraud case

Allen Stanford
Allen Stanford in 2009 Keystone / Aaron M. Sprecher

In one of the biggest fraud cases in recent US economic history, Switzerland is handing over around $200 million (CHF178 million) to the United States.

The money is to be returned to the injured parties, the Federal Office of Justice (FOJ) said in a statementExternal link on Monday.

The restitution became possible after the US investment broker Allen Stanford was convicted of fraud in the US. Stanford had defrauded thousands of investors out of more than $7 billion between 2001 and 2008 with a Ponzi scheme. For this, he was sentenced to 110 years in prison in the US in 2012. The criminal assets were confiscated in favour of the injured parties.

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Victims of $7bn Ponzi scheme compensated

This content was published on The company Stanford Group (Suisse) in Liquidation has been fined CHF1 million ($1.14 million) for aggravated money laundering and sentenced to pay compensatory claims of CHF6-9 million, as well as to bear the costs of the proceedings. Both the fine and the compensatory claims will go to the victims of the investment fraud. The Swiss…

Read more: Victims of $7bn Ponzi scheme compensated

Switzerland supported the US in these criminal proceedings. The FOJ handed over to the US authorities relevant bank documents relating to various accounts in Swiss banks and ordered the seizure of assets in Swiss accounts.

In 2019, following the final confiscation judgment in the US, the FOJ ordered the return of the frozen assets. The appeals filed against this were dismissed by the Federal Criminal Court on October 16, 2020.

The FOJ said it would therefore return the remaining $150 million to the US authorities in favour of the victims by the end of December 2020. The first tranches have already been paid.

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