UPDATE 3-Stanford Financial eyed by regulators - source

(Adds source confirming regulatory probes, background on Stanford)

NEW YORK Feb 11 (Reuters) - Stanford Financial Group, which says it oversees more than $50 billion of assets, is being investigated by U.S. regulators over its business, a person familiar with the matter said on Wednesday.

The U.S. Securities and Exchange Commission and the Financial Industry Regulatory Authority (FINRA) are looking into the company, the person said.

Earlier Wednesday, BusinessWeek said in its online edition that the SEC, FINRA and the Florida Office of Financial Regulation were investigating Stanford's ability to pay high yields on CDs, even as it invests CD money largely in stocks, real estate, hedge funds and precious metals, many of which have lost value in recent months.

The report comes as investors, politicians and regulators focus more on the returns that investment firms promise and actually provide, in the wake of accused swindler Bernard Madoff's alleged $50 billion Ponzi scheme.

"This is a rehash of old gossip and unsubstantiated allegations," said Stanford spokesman Brian Bertsch, referring to the BusinessWeek article. "The Stanford Financial Group is rigorously managed and fully compliant with all U.S. regulations."

With respect to the regulators, he added: "All three agencies have stated to us that they were visiting our offices as part of routine examinations."

The SEC declined to comment. The other regulators did not immediately return calls seeking comment.

Citing people close to the investigations, BusinessWeek said regulators are also looking at how Stanford could lavish large bonuses, luxury cars and expensive trips on employees by selling CDs, which are usually low-margin products.

According to its website, Stanford has more than 50 offices in North America, Latin America, the Caribbean and Europe. Founded in 1932, the firm offers services including private wealth management, investment banking, equity and policy research, sales and trading, and consulting, the website said. (Reporting by Rachelle Younglai, Jonathan Stempel and Julie Vorman; Editing by Bernard Orr)