| MEXIA, TEXAS
MEXIA, TEXAS Feb 19 When Billie Stanford heard
that the Federal Bureau of Investigation had found her stepson
Allen Stanford, the billionaire Texan facing a federal fraud
charge, she and her husband thanked God.
"That is one relief off of our minds. We're so pleased and
thankful to the Lord that he's alive, and healthy, I'm sure,"
Stanford, 73, told Reuters.
Now begins the hard part. Stanford faces U.S. Securities
and Exchange Commission accusations that he engaged in an $8
billion fraud. The SEC has charged Stanford, two of his
colleagues and three of his companies.
His parents do not believe that Stanford defrauded
investors, but they cannot say that it did not happen.
"I can't believe that he has, but I won't say 'no,'" said
James Stanford, 81, sitting at his desk in a small office in
the east-central Texas town of Mexia (Muh-HAY-uh), where Allen
Stanford was raised.
"I'll defend him. We love him and support him, but he
should do the right thing and come forward," the elder Stanford
said. "Don't run and hide. God damn, don't do that."
Earlier on Thursday, Stanford's father said he knew nothing
about the SEC's accusations against his son. He said he did not
know where Allen was.
Later in the day, FBI agents found Stanford in
Fredericksburg, Virginia. Billie Stanford said that he had not
yet called his father.
James Stanford, chairman emeritus of Stanford Group Co, has
received a subpoena and is due to testify for the SEC next week
in Waco, Texas.
STANFORD EMPIRE STARTED IN 1932
Before Allen turned it into an empire, the company, founded
in 1932 by James' father Lodis, sold insurance.
Allen took over in 1993. His father has participated in
board meetings, but is not involved in day-to-day operations.
Another board member who served in a similar capacity is
former Mexia car dealer Oliver Goswick. Goswick, known as
"O.Y.," lives in Mexia with his family. He has also been
His son, Richard Goswick, said that neither James Stanford
nor his father would have known what Allen Stanford was doing
as head of the Stanford International Bank (SIB). SIB is based
on the West Indies island Antigua.
Richard said that James and his father served as board
members in an essentially honorary capacity.
He said of his father: "If he thought there was anything
wrong, he would have divorced himself from the relationship."
"These are churchgoing, small-town people," said Richard
Goswick, 63, who owns the Dick Scott Ford dealership in Mexia.
O.Y. Goswick was a General Motors serviceman and an auto
dealer proprietor after leaving the U.S. Air Force, his son
said. He said his father had a high school education and was
not a sophisticated financier. "His mental capacity at his
prime could never conceive of something of this nature," he
said, referring to the alleged fraud.
In 2000, Goswick suffered a stroke and his health has
worsened since then, his son said. He cannot communicate, and
can walk only short distances. His son has a doctor's note
explaining the elder Goswick's condition, and he plans to send
it to the SEC. First, he said, he must hire a lawyer for his
Goswick said he had met Allen Stanford occasionally over
the years, and considered him an intelligent, charismatic man
who dressed well and ran a company with an eye on cleanliness
as well as success. "You couldn't even be employed by Allen if
you smoked," he said, adding that even the hangar where
Stanford's planes were stored, was immaculate.
NO GLITZ AT MEXIA OFFICE
The building is simple, white walled with low ceilings and
a gabled roof. Like Mexia, there is nothing flashy. James
Stanford wore a black suit jacket, blue shirt and black pants
when we met at his one-floor office there. He uses a walker.
He wears a brace on his neck and his head leans forward
when he speaks, but his sharp eyes really do all the talking.
James said his office has no dealings with Stanford's
business. Instead, it is a place for him to go besides home.
James has been working there for 25 years. A picture of him
and his son, smiling in the same office, hangs on a wall.
He said he was asked not to talk to the press, but he did
not say by whom. He has been giving interviews anyway.
James said he knew nothing of his son's business dealings
today. But, in the late 1990s, he said, a Mexican customer of
Stanford put $3 million into the bank for investment purposes.
U.S. Drug Enforcement Administration (DEA) agents then
approached Allen Stanford and said the money was from a Mexican
drug cartel and had been laundered several times.
James said that Allen had told the board about this, and
that he had "refunded" the money to the U.S. Treasury. He said:
"Allen worked with them, hand in glove."
The last time he spoke to his son, he said, was a week ago.
James said that during that conversation, Allen intimated that
the company was in trouble, but he would only tell his father
to read The Wall Street Journal.
NO HOMETOWN HERO
In a town of fewer than 11,000 people, residents know who
Allen Stanford is, but most do not know him well. He left with
his mother when he was 9 years old after she and James Stanford
divorced. He graduated from high school in Fort Worth.
After starting a health club in Waco that failed, Stanford
left the United States, Richard Goswick said.
He said Allen Stanford then met a lawyer with connections
in Antigua, where Stanford now has dual citizenship.
Stanford bought many houses and apartments, flipped them
for higher prices and worked his way into serious money in
Houston. The metropolis lies about 165 miles and a world away
from the dusty, sparsely populated streets and many empty brick
front stores of Mexia.
Bob Wright, editor of the Mexico News, said Allen Stanford
"always had an entrepreneurial spirit."
That included selling his old bicycle to his neighbor, Jo
Bennett, when they were both about 10 years old, Bennett, 58,
recalled. "We were just little kids."
Though few say they know Allen Stanford well, the Stanford
family's history is intertwined with the history of Mexia.
James Stanford served several terms as the town's mayor. Even
when Allen Stanford's mother sold her house, the real estate
agency that Bennett works for handled the sale.
Except for visiting his parents and helping his mother to
sell her house a month or two ago, Allen Stanford has not been
much of a presence in Mexia.
"Not that many people knew him," said Dick Flatt of Flatt
Stationers Inc. "Stories would come from time to time over the
wire about how he done good, made another million in Houston."
"We thought maybe he was down in Venezuela somewhere," he
(Reporting by Robert MacMillan; Editing by Toni Reinhold)