Regional central bank seizes Bank of Antigua

MIAMI (Reuters) - The Eastern Caribbean Central Bank seized control on Friday of the Bank of Antigua, a commercial bank controlled by Texas billionaire Allen Stanford.

The central bank took over the bank in the Caribbean nation of Antigua and Barbuda after “an unusual and substantial withdrawal of funds,” the bank said in a written statement.

Stanford, who was knighted by Antigua in 2006 and holds citizenship there, was accused this week by the U.S. Securities and Exchange Commission of carrying out a massive fraud through Antigua-based Stanford International Bank (SIB).

The SEC said in a complaint filed on Tuesday in Dallas, Texas, that SIB sold $8 billion in certificates of deposit promising impossibly high return rates. SIB, Stanford Group Co, and Stanford Capital Management LLC were named in the complaint along with Allen Stanford, his aide James Davis, and O.Y. Goswick, a Stanford board member.

The central bank said publicity surrounding the case had created a situation where the interests of depositors and creditors were threatened and the bank “is likely to become unable to meet its obligations.”

Earlier on Friday, Antigua and Barbuda’s bank regulator appointed a receiver to take control of SIB and Stanford Trust Company.

Reporting by Jim Loney; Editing by Toni Reinhold