The Stanford Group whistleblowers

February 19, 2009 7:07:45 PM PST
Twenty-four hours after federal regulators shut down the Stanford Investment Group during a raid on their Houston offices, the fear is being felt internationally.[SIGN UP: Get headlines and breaking news sent to you]

In the Caribbean Island of Antigua, panicky depositors lined up to pull their money out of two banks owned by the Stanford Group. Now we are hearing from two whistleblowers who worked for the company.

In an interview shot first by ABC News, the two men whose allegations helped build the case against Stanford Group are speaking out. They say they quit their jobs believing they'd likely be fired after questioning the way Stanford operated.

Mark Tidwell and Charles Rawl used to be financial advisors with Stanford Group. They resigned in December of 2007, fearful that if they didn't, they could be held criminally liable in the company's dealings.

"Certainly unethical, the business practices were not what I expected," said Rawl.

In a lawsuit they have filed against Stanford Group, the men allege that, "Stanford employed illegal and unethical methods to market and sell its financial products to the public."

Federal investigators allege owner Robert Allen Stanford and his three companies orchestrated a multi-billion dollar investment scheme that centered around an $8 billion CD program. It alleges that potential customers were falsely promised double digit percentage returns on their investments at a time when actual returns were far less, or even lost money.

"I feel horrible, there's good people that have their hard earned money at that institution and they can't get it out," Tidwell said.

Tidwell and Rawls say they repeatedly asked Stanford management to change their business practices, but in the suit they allege that, "Stanford refused to cease its illegal activity."

"It was very troubling, knowing that management knew that these issues were out there and yet their approach was not what we would deemed to be ethical or prudent," Tidwell said.

Federal investigators talked to the two men, and using their information, launched a full scale investigation which resulted in the Tuesday raid of Stanford's offices in the Galleria area. The whistleblowers say they find relief knowing that their suspicions were believed by investigators.

"It was one of mixed emotions, I did feel some vindication," Tidwell said.

Tidwell and Rawl's suit alleges wrongful termination employment discrimination. They say they are hopeful that investors, many of them clients with whom they worked closely, can get most if not all of their money back.

Some investors are now coming forward to join a separate class action lawsuit filed by former Stanford employees.

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