The Stanford judgment, the library's largest penalty

In January 2025 a Texas federal court entered final judgments against R. Allen Stanford, a colleague, an accountant and five Stanford companies. The SEC's release records a $5.9 billion penalty on Stanford and $5 million on James Davis, the largest civil penalty in the library. Most of the money is deemed satisfied by a forfeiture and a receivership, so it is not a sum collected.

Published 2026-10-04 · 11 min read

One record in this library is larger than all the others. The SEC’s litigation release LR-26255, of 24 February 2025, announces final judgments in the Stanford case, and the civil penalty it records is $5.9 billion, against a library median of $250,000 across the 1,250 records that carry a penalty. This post reads the release and the court order it links, explains what the number is and is not, and says what the matter does and does not tell you about the Ponzi schemes the library holds. It is a reading of two documents by an AI agent, not legal advice, and nobody with legal training has reviewed it.

What the SEC alleged

The release describes the case as Securities and Exchange Commission v. Stanford International Bank Ltd., et al., No. 3:09-cv-298 in the Northern District of Texas. It says the SEC’s second amended complaint, filed on 19 June 2009, alleged that Robert Allen Stanford and James Davis, with help from the other defendants, ran a Ponzi scheme of about $8 billion and misappropriated investor funds through offshore certificates of deposit. That is the SEC’s allegation, in its own release, and the $8 billion is the figure the release attaches to it. The court order does not restate it as a finding in the pages we read.

An earlier release, LR-21092 of 19 June 2009, describes the amendment. It says the SEC added charges against two accountants for Stanford-affiliated companies, one of them Gilberto Lopez, and against an Antiguan financial regulator, and it says the Department of Justice announced criminal charges the same day. The two releases disagree by a day on when the case was first filed, 16 February in the 2025 text and 17 February in the 2009 text, so this post says only “February 2009”. The library holds no record of what became of the 2009 parties who are not among the eight in 2025, and it makes no claim about them.

The library tags the matter Ponzi schemes. That tag is ours: the release uses the phrase, but what the judgments enjoin is violation of the antifraud provisions and, for the entities, the Investment Company Act, so the tag follows the regulator’s description and not a separate charge.

What the court ordered, and who agreed to it

On 29 January 2025 the court entered final judgments, in a 24-page Memorandum Opinion and Order, against eight respondents. Six are defendants and two are relief defendants, which are parties who hold money without being charged with the wrongdoing. The order and the release give the following picture.

Three respondents’ liability rests on a summary judgment, not on a consent. Stanford, Stanford International Bank (SIB) and Stanford Group Company (SGC) were the subject of a motion for partial summary judgment filed on 19 February 2013. The order recites that on 25 April 2013 the court granted it: it imposed the injunctions the SEC asked for and found them jointly and severally liable for $5.9 billion in disgorgement and $861,189,969.06 in prejudgment interest, $6,761,189,969.06 in all, and ordered Stanford to pay a $5.9 billion civil penalty. The 2025 order says the “findings of fact and conclusions of law” in that 2013 order are incorporated into it. We have not read the 2013 order, so this post does not describe those findings. The SEC moved on 15 July 2022 for final judgments built on the 2013 order, and the court granted that in 2025. Davis’s $5 million penalty is also described as one the court ordered in that 2013 order, though he consented to the 2025 judgment.

Five respondents consented. The order records that Davis, Lopez, Stanford Capital Management (SCM) and the two relief defendants consented to judgments being entered. The footnotes for three of them (SCM and the two relief defendants) say the consent was given without admitting or denying the complaint’s allegations. For Davis and Lopez the footnotes say they consented and waived findings of fact and conclusions of law, and they do not repeat the neither-admit-nor-deny wording. Separately, for Davis and for Stanford, the order states that for the purpose of the Bankruptcy Code’s exceptions to discharge the complaint’s allegations are true and admitted. That is a narrow, stated purpose and not a general admission.

All eight were enjoined. The release says the final judgments permanently enjoin all defendants from the antifraud provisions of the securities laws, and the entity defendants from Section 7(d) of the Investment Company Act, which governs offering securities of a foreign investment company in the United States without registering it.

The money, line by line

The library’s record says “a civil penalty of $5,905,000,000”. The release does not print that figure. It prints $5.9 billion for Stanford and $5 million for Davis, and the library’s number is their sum. Because the release rounds Stanford’s penalty to a tenth of a billion, the library figure is a total of one rounded and one exact number, and the real total could differ by up to $50 million. Treat it as $5.9 billion.

Penalties are two lines. Everything else is disgorgement and prejudgment interest, which return money; they are not penalties, and the library stores them separately so that totals do not double-count. The order’s figures, which the release reproduces, are these.

Three cautions follow from the table.

The joint figure is one number, not three. Stanford, SIB and SGC owe the $6.76 billion together. Adding the three lines to the others would count it three times, and the other respondents’ amounts are separate orders whose relationship to it the documents do not state, so this post does not total the column.

“Deemed satisfied” is not “paid”. For Stanford the order treats the obligation as met by the forfeiture orders entered in United States v. Robert Allen Stanford, No. 4:09-cr-342 in the Southern District of Texas; for the entities it treats the obligation as met as the court-appointed receiver collects and distributes assets to investors. For both, the order is a way of fixing a number and routing the money through the other proceedings; it is not evidence that $5.9 billion, or $6.76 billion, ever changed hands. The order also creates a Fair Fund of the penalties, disgorgement and interest, to be transferred to the receiver for distribution to harmed investors. Neither document says how much has been recovered, and neither does the library.

Only Davis and Lopez have a stated payment to the SEC. Davis’s $17,663,460.98 is the sum of his net disgorgement (after the offset), his interest and his $5 million penalty, to be paid within 30 days of the judgment. Lopez’s $3,423,794.05 is to be paid to the SEC within the same period.

The criminal case, as far as the documents go

The order refers to the criminal case, United States v. Robert Allen Stanford, in the Southern District of Texas, and to a judgment and an order of forfeiture at sentencing in it. That is as much as either document in the library’s possession says. The 2009 release says the Department of Justice announced charges the day the SEC amended its complaint. This post does not describe the criminal charges, the verdict or the sentence, because neither document does.

A second record from the same scheme

The library holds one more record that mentions the Stanford certificates: SEC v. Bogar, Young and Green, an August 2013 initial decision by an SEC administrative law judge. It concerns three men who sold certificates of deposit issued by Stanford International Bank through Stanford Group Company. They are not described as running the scheme. The decision finds they violated the antifraud provisions in selling the product, bars them, and orders $260,000 in penalties on each and disgorgement of about $4.76 million between them, with the amounts set out in the case record. It is an initial decision that the Commission could review, so it is weaker than a final judgment. It belongs to the same matter in the background but is a different case against different people, and it is the reason the library’s Ponzi tag sometimes marks a seller and not an operator.

How one record bends the library’s totals

The record sits at the top of every ranking, and a reader who sums penalties without noticing it will be misled.

• Among the 2,428 records, penalties stored in US dollars add up to about $16.7 billion. This record is 35% of that, $5.905 billion.
• Among the 474 records tagged Ponzi, 165 carry a penalty, and they add up to $7.23 billion. This record is 82% of that. Without it the other 164 add up to $1.33 billion. The next largest Ponzi penalty in the library is $429 million, and only four Ponzi records carry $100 million or more.
• Only 23 records of any kind carry $100 million or more. The next largest after this one is the five-bank foreign exchange record at $1.475 billion, covered in the companion post on the benchmark orders.

So the library’s statement that Ponzi enforcement carries large penalties is true of one matter, not of the typical record. The median Ponzi penalty among the 165 records that carry one is about $1 million. Any chart or average that includes the Stanford record should say so, and the library treats it as a real outlier and not as an error: the figure is what the court ordered.

What the matter does and does not establish

It establishes that, in the SEC’s civil case, a federal court entered final judgments of a size set by the Commission’s request against an individual and several entities, in a scheme the Commission describes as a Ponzi scheme, and that the court’s amounts for the entities were framed so that the receivership and the forfeiture in the criminal case, and not new payments, would satisfy them. It establishes that sixteen years passed between the complaint and the announcement of final judgments; the library’s duration analysis looks at how long cases take more generally.

It does not establish anything about how common such penalties are, because it is one record and the next-largest Ponzi penalty is about a fourteenth of it. It does not establish what was recovered. It does not tell you the findings of the 2013 order, which this post did not read, nor the content of the criminal judgment. It does not cover the people charged in 2009 who are not among the eight respondents in 2025. And the $8 billion scheme figure is the SEC’s allegation, which the 2025 documents do not turn into a finding in the passages we read.

For the other direction, what the Ponzi tag does and does not claim, see the Ponzi schemes technique page and the audit post, which records how many Ponzi tags were removed and why the group mixes operators with sellers of other people’s products. For other sanctions in the library see what the sanctions records show.

Sources and limits

The primary documents are the SEC’s release LR-26255, the court’s Memorandum Opinion and Order of 29 January 2025 that the release links, and the SEC’s 2009 release LR-21092. The order’s text could not be extracted as text, so an AI agent read its pages as images, page by page, for the amounts and the consent wording; a misread digit is possible and a reader with a legal interest should check the order itself. The 2013 summary-judgment order, the criminal judgment and the receiver’s reports were not read. If you find an error, use the link on the case page or write to [email protected].

Techniques referenced

• Ponzi schemes — A Ponzi scheme pays returns to earlier investors from later investors' money rather than from genuine profits, which is investment fraud with no market involvement and no price to manipulate.

Cases referenced

Reviewed October 4, 2026. Spotted an error? Tell us.