The Securities and Exchange Commission (SEC) has charged Robert Allen Stanford, chairman of the Stanford Financial Group (SFG) of companies, three of his companies and two other Stanford executives with alleged fraud for an investment scheme surrounding an $8 billion CD program.

Stanford's companies include Antiguan-based Stanford International Bank (SIB), investment advisor Stanford Group Company (SGC), and Stanford Capital Management, an investment adviser. In addition to Stanford, James Davis, who serves as chief financial officer to SIB, and Laura Pendergest-Hold, chief investment officer of SFG, were also charged in the enforcement action, according to the statement.

According to the complaint, SFG, through SIB, has sold about $8 billion of CDs to investors, along with the promise of "improbable and unsubstantiated high interest rates." The rates were said to be earned through SIB's investment strategy. SIB claims to have achieved double-digit returns on its investments over the past 15 years, which in turn allowed it to offer high yields to CD purchasers. The SEC alleges Stanford and SFG misrepresented to investors that their investments were "safe."

"Through this fradulent scheme, SIB, acting through a network of SGC financial advisors, has sold approximately $8 billion of self-styled 'certificates of deposits' by promising high return rates that exceed those available through true certificates of deposits offered by traditional banks," according to the court filing, which was filed in Dallas.

Last week, an SFG spokesman told IDD the recent SEC visits, in addition to inquiries by two other regulatory bodies, were routine. SFG declined to comment, and referred all inquiries to the SEC.