R. Allen Stanford’s alleged $8 billion fraud has claimed its most high-profile victims yet: Yankee outfielders Johnny Damon and Xavier Nady.
Damon and Nady are among the investors whose assets were frozen this week after the feds raided Stanford’s Houston offices and the Securities and Exchange Commission accused Stanford of fraud involving the sale of $8 billion in certificates of deposits that boasted unusually high returns.
“My money has been frozen for four or five days,” Damon told The Post in a telephone interview. “Hopefully it won’t be much longer.
“I can’t pay my bills. My paychecks go into the fund. There is one out there but I am getting another one soon [March 1].”
Meanwhile, Nady told Fox Sports that he has the same financial adviser as Damon, and that as a result of the Stanford fallout he, too, has gotten slammed.
Nady said “all my credit-card accounts are frozen right now because of that situation. I’m trying to get an apartment in New York. I can’t put a credit card down to hold it.”
That isn’t a problem for Damon, who said he’s relying on his American Express card to carry him through in the interim.
“We have American Express and no limit,” Damon said.
Damon explained he met his investment advisers through connections that his agent, Scott Boras, had. Nady is also represented by Boras.
However, Damon absolved Boras of any wrongdoing.
“He has nothing to do with it,” Damon said. “Everyone needs to pay more attention to what they are doing with their money these days.”
Boras said the pair did not invest directly with Stanford, but instead had investments with broker-dealers that had accounts with a Stanford company.
Ever since Stanford was charged by the SEC, there has been widespread speculation that the scandal could ultimately ensnare athletes, much the way the alleged $50 billion Bernard Madoff Ponzi scheme sucked in high-profile members of New York’s and Palm Beach, Fla.’s Jewish communities.
Stanford is an active sponsor of golf tournaments and cricket matches and has a relationship with IMG, Teddy Forstmann’s Los Angeles-based management firm that reps high-profile athletes like Tiger Woods and Vijay Singh, who just this week played at the Northern Trust Open and was sporting clothes bearing the Stanford logo.
The Post on Thursday reported that IMG quietly steered clients looking for investment advice to Stanford Financial Group, potentially exposing them to millions of dollars in losses resulting from the financial firm’s alleged fraud.
IMG officials have denied they sent their clients to Stanford.
Meanwhile, the reverberations from Stanford’s fraud were felt across Latin America today as local regulators tried to calm panicked investors.
Peru’s securities regulator suspended the operations of the local office of Stanford Financial Group after nervous investors lined up at the company’s office in Lima. The South American nation also said today that it started an investigation to see if the local unit of Stanford Group had engaged in money laundering.
In Antigua and Barbuda, the Caribbean island where Stanford holds citizenship, the central bank seized Stanford’s banks and other companies. The regulator said it took the action because the publicity surrounding the Stanford case had created a run on the bank.
Stanford was the biggest private investor and employer in the tiny Caribbean state, which granted him a knighthood in 2006.
The 58-year-old Stanford, who has not yet been charged criminally, has been holed up in a small suburban house in Fredericksburg, Va., about an hour south of the US capital.
Reporters and camera crews maintained a vigil outside the house today, which is said to be the home of his girlfriend, Andrea Stoelker, who had been president and director of the Stanford 20/20 cricket tournament that Stanford sponsored in Antigua.