Three banks agreed to pay $1.35 billion to resolve litigation by former Allen Stanford investors who accused them of contributing to the imprisoned financier’s massive Ponzi scheme.
Canada’s Toronto-Dominion Bank will pay $1.205 billion, HSBC Holdings Plc (HSBA.L) will pay $40 million and Independent Bank Group Inc (IBTX.O) , formerly Bank of Houston, will pay $100 million.
Money will go to a court-appointed receiver who is repaying victims of Stanford’s $7.2 billion fraud, which was uncovered in Feb. 2009, two months after the arrest of Bernard Madoff.
Stanford’s Ponzi scheme was at the time considered the largest other than Madoff’s.
The settlements require a judge’s approval.
They avert a trial that had been scheduled for Monday in Houston federal court, where TD, HSBC and Independent Bank were the last remaining defendants.
Source: TD, other banks reach $1.35 bln settlements to end Stanford litigation | Reuters