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Stanford fraud case: FBI Arrests Stanford Executive Laura Pendergest-Holt

By Amarendra Bhushan for CEOWORLD Magazine Updated:February 27, 2009

The FBI made the first arrest in the Stanford Financial Group fraud investigation, detaining Chief Investment Officer Laura Pendergest-Holt on federal obstruction charges.

The criminal complaint against Pendergest-Holt said she failed to tell investigators she had served on the bank’s investment committee and that the investment portfolio holding more than 80 percent of its assets included a $1.6 billion loan to a top Stanford executive — evidently Stanford.

Pendergest-Holt was to make an initial court appearance before a U.S. magistrate in Houston on Friday after her arrest by FBI agents.

Pendergest-Holt concealed her role in and familiarity with the investments of the Antigua-based Stanford International Bank from Securities and Exchange Commission investigators earlier in February.

U.S. securities regulators have filed civil charges against the financial group’s chairman, Allen Stanford, along with Pendergest-Holt and Chief Financial Officer Jim Davis, accusing them of fraudulently marketing $8 billion in high-interest certificates of deposit issued by the Antigua bank.

Who is Laura Pendergest-Holt?

The Baldwyn native, now 35, Laura Pendergest-Holt is the youngest and perhaps most unlikely member of the Stanford Financial Group trio accused of an $8 billion fraud.

The complaint also alleges that Pendergest-Holt did not reveal that she was a member of the bank’s investment committee.

“We appreciate the quick and decisive action of the Department of Justice and the FBI, and thank them for their fine work and cooperation in this matter,” SEC Deputy Enforcement Director Scott Friestad said.

Stanford is accused in civil charges of lying about the safety of investments he sold as “certificates of deposit” and promised unrealistically high rates of return. Regulators also said he faked historical data about other investments which he then used to lure in more investors for the CD products.

Michael Zarich, the company’s senior investment officer, has told authorities he didn’t know where 90 percent of Stanford’s portfolio was invested. Zarich has said he was trained by Pendergest-Holt to deflect questions about the investment strategy while pitching to wealthy clients in Antigua, where the bank was chartered.

Laura Pendergest-Holt is accused of obstructing a Securities and Exchange Commission investigation of an alleged $8 billion investment fraud involving Texas billionaire R. Allen Stanford. Stanford is accused in civil charges of lying about the safety of investments he’d sold as “certificates of deposit” and promising unrealistically high rates of return.
Pendergest-Holt’s attorney says his client is looking forward to working with the government to get all the facts out.

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