Get The Government Off Our Backs!

The State of Florida, in its infinite wisdom, and no doubt drunk on deregulatory propaganda, completely ceded its regulatory authority, allowed Allen Stanford to avoid regulation entirely, and thus greatly aided his complicated international swindles:

Years before his banking empire was shut down in a massive fraud case, Allen Stanford swept into Florida with a bold plan: entice Latin Americans to pour millions into his ventures -- in secrecy.

From a bayfront office in Miami in 1998, he planned to sell investments to customers and send their money to Antigua.

But to pull it off, he needed unprecedented help from an unlikely ally: The state of Florida would have to grant him the right to move vast amounts of money offshore -- without reporting a penny to regulators.

He got it.

Over objections by the state's chief banking lawyer -- including concerns that Stanford was laundering money -- regulators granted sweeping powers never given to a private company.

The new company was also allowed to sell hundreds of millions in bank notes without allowing regulators to check for fraud.

Over the next decade, the Miami office was among Stanford's busiest in the sale of controversial investments now at the heart of the federal government's sweeping fraud case against Stanford and his lieutenants.

...Represented by a powerful Florida law firm, Stanford got approval to create the first company of its kind: a foreign trust office that could bypass regulators, according to records obtained by The Miami Herald.

...Now, with Stanford indicted on sweeping fraud charges last month, the Miami office poses serious challenges for federal agents trying to find assets from the demise of his vast banking fortune, legal experts say.

In all, prosecutors say Stanford diverted nearly $7 billion from customers who purchased his CDs, long touted for their high returns.

Some of the millions went to support Stanford's lavish lifestyle, including private jets, expensive cars and mansions, including a $10.5 million home in Gables Estates that he has since torn down, records show.

Investors who flocked to the luxury offices on the 21st floor of the Miami Center to buy the CDs are clamoring for their money, saying they were fleeced of millions.

''It's not fair that so much money has gone down the drain,'' said Margie Morinaga, whose 84-year-old father lost $400,000.

Former customers are sending letters to the court receiver, pleading for help; others are angrily organizing to press for the recovery of their money.

...Unlike other Stanford companies around the country, the Miami office was exempt from reporting the amounts of money sent overseas -- bypassing anti-laundering laws.

In fact, employees shredded records of the trust agreements and CD purchases once the original documents were sent to Antigua, state records show.

...Simon, the Florida banking director who approved the agreement, says he should have banned the office from handling money.

''It raised serious questions in my mind after the fact as to whether we should have had tighter provisions,'' said Simon, a former state representative who helped draft much of Florida's modern banking legislation.

The office was only supposed to provide information for people interested in the offshore trust's services -- not offer CDs and accept money, he said.

But in clear language, the agreement reached between Stanford and state regulators allows money to flow to and from the center.

Simon, 63, now retired from state government, said he didn't recall the language until he was e-mailed a copy by The Miami Herald.

But several lawyers who reviewed the documents for The Herald said much of the responsibility rests with Simon. ''In this case, he was responsible for having an effective system of enforcement,'' said Jeffrey Sonn, a Fort Lauderdale securities attorney. ``The state didn't do the kind of reviews it needed to do.''

Miami banking lawyer Jose Sirven said the state may have been able to approve the office, but questioned the state's decison to let employees transfer money.

Donelan, the state's chief banking counsel, said he did not believe Stanford had the right to open the satellite office in the first place.

``It was not an American financial institution. I had expressed that opinion. There was no regulation. It was as if they had an office that could be selling shoes or ice cream.''

...In the end, the Miami company was allowed to open under a unique category: a foreign trust representative office -- the only one in Florida.

While the state allows out-of-state trust companies to set up satellite offices in Florida -- catering to snow birds loyal to their hometown banks -- there are no provisions in Florida law for similar foreign offices.