The UK’s highest court has agreed to an attempt to revive a case against HSBC brought by a Caribbean bank brought to its knees by a $7 billion Ponzi scheme run by its charismatic former owner Allen Stanford.
Stanford International Bank (SIB) collapsed in 2009 with debts of more than $5bn after it was used for what English judges described as one of the “largest and most prolonged Ponzi schemes in history”.
The liquidators of the bank claim that HSBC should have frozen SIB accounts before more than £118 million ($162.7 million) was paid out from them in six months to February 2009. They brought a High Court claim against the bank but three Appeal Court judges tossed out the case in April.
The Supreme Court on Thursday confirmed that it would consider an application by SIB to hear a final appeal. Lawyers for SIB could not be reached for comment. HSBC had denied any wrongdoing, saying the money it paid were SIB debts properly paid to its investors.
Stanford, a flamboyant Texan financier and cricket promoter in the Caribbean, is serving 110 years in a US jail after a jury convicted him of running the enormous fraud, centred on the bank in Antigua, for more than two decades. He was accused of defrauding nearly 30,000 investors in 113 countries.
He is best known in Britain for his splashy backing of a winner-takes-all cricket competition launched in 2008 by flying a helicopter into Lord’s cricket ground with treasure chests full of fake cash.
The competition included five matches between an England team and a Caribbean side of Stanford Superstars, but the series collapsed after a single game when the financier in 2009 was charged by the US authorities with fraud.
Despite throwing out most of the case in March, the three UK Appeal Court judges ruled that SIB’s liquidators still had one final claim against HSBC for about £2.4m that was paid to the English Cricket Board.