Antiguan ex-official arrested in Stanford case

Antigua’s former chief financial regulator surrendered Thursday to face U.S. charges that he aided an alleged $7 billion swindle by Texas billionaire R. Allen Stanford, government officials said.

Leroy King, who will now face extradition proceedings, was taken into custody by island police, according to Anthony Armstrong, the director of public prosecutions for Antigua and Barbuda.

U.S. prosecutors said that as administrator of the Caribbean nation’s Financial Services Regulatory Commission, King should have caught the fraud. He is accused of accepting more than $100,000 in bribes to turn a blind eye to irregularities.

Stanford, who pleaded not guilty Thursday in Houston, was indicted last week on U.S. charges that his banking empire was really a Ponzi scheme built on lies and bribery. The billionaire and several executives allegedly misused most of the $7 billion they advised clients to invest in certificates of deposit from the Stanford International Bank, based on Antigua.

King, 63, faces charges including wire fraud, mail fraud, and conspiracy to obstruct an investigation by the U.S. Securities and Exchange Commission.

He was fired by the twin-island government on Tuesday, and Armstrong said authorities obtained a warrant for his arrest Wednesday at the request of the United States. He said King will be handed over the Americans once the U.S. sends documents required for his extradition.

In the interim, a magistrate set bail Thursday at 500,000 eastern Caribbean dollars — about $190,800 — and ordered that King, who has cancer, would only be allowed to leave his house for medical reasons, Armstrong said.

“Given the allegations which we have, we are of the opinion that the bail conditions are appropriate,” Armstrong said. “He is a flight risk.”

Stanford’s Antigua enterprises also include a newspaper, two restaurants, a development company and the Stanford cricket grounds, where he shook up professional cricket last year by bankrolling the purse in a $20 million winner-take-all match.