Local Stanford Group Victims Hold Out Little Hope

by Gwen Moritz  on Monday, Sep. 27, 2010 12:00 am  

Estimated Losses
Based on the number of clients listed in the bankruptcy and the minimum investment required in the CDs, the losses by Collier's clients total at least $1.5 million - and possibly much more.

But Collier was only one of five financial advisers working for Stanford in Little Rock at the time of the collapse, and he was not the most successful peddler of Antiguan CDs in the group. That title belongs to James R. "Jim" Alguire, who was one of 66 Stanford brokers sued by name by the Securities & Exchange Commission - and, unfortunately for Alguire, the 66 are listed in alphabetical order, putting his name at the top of the list and on the front of every document filed in the case.

The named "relief defendants" in the SEC's case all collected at least $200,000 - and up to $2.6 million - in "fraudulent commissions" from selling the Antiguan CDs. Alguire personally collected $273,669 in commissions between January 2007 and January 2009, according to the lawsuit.

The total value of CDs sold by Alguire isn't known. According to the SEC, Stanford paid a 1 percent commission upon the sale of a CD "and as much as an additional 1% trailing commission during the term of the CDs." At a minimum, then, Alguire sold at least $13 million worth of the CDs during the two-year period covered by the lawsuit, and probably much more.

No other Little Rock adviser is named in the SEC complaint, presumably because the others - Collier, Mike Arthur, Matt McDaniel and Heath Stevens - didn't collect at least $200,000 in CD commissions.

But Collier was making money during that period after the Stanford Group bought the Little Rock office from StillPoint Advisors near the end of 2006. His compensation from Stanford - the only income he had, according to his bankruptcy petition - was $252,575 in 2007 and $392,629 in 2008.

But in 2009, the year in which Stanford collapsed and Collier and the others joined the Little Rock office of Sterne Agee & Leach, his income fell to $113,274. And as of July, his income was listed at just over $4,000 a month. His take-home pay after taxes, Social Security and insurance, is $1,540, leaving him with a monthly shortfall of more than $8,700.

According to his testimony at the bankruptcy hearing, Sterne Agee & Leach paid him a signing bonus - really a forgivable loan - of more than $100,000 when he joined the firm after the collapse of the Stanford Group in February 2009.

That, Collier said, was based on the fact that he was managing assets of about $125 million at Stanford, a figure that included the assets of Heifer International Foundation of Little Rock, the operational foundation that provides financial support for Heifer International. Heifer Foundation's most recent Form 990 filed with the Internal Revenue Service listed total assets of $39.3 million as of Dec. 31, 2008.

Heifer International Foundation is no longer his client, Collier said, and his current book of business is about $15 million in assets under management.

 

 

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