Offshore

Have you ever been to Antigua? I first went there in 2000. I arrived there Christmas day, alone. Alone in Antigua Christmas Day? Yeah. I liked it. My mother and stepdad arrived late that night, for a two-week stay at a vacation home belonging to a friend of my mother's. A couple years later, when I was living in St. Kitts I made quite a few trips to and through Antigua. I had a therapist in Antigua for a while. In fact, I spent so much time in the Antigua airport that I nicknamed its departure lounge The Pink Purgatory. In the Pink Purgatory hangs a portrait of V.C. Bird, patriarch of the Bird family that ruled Antigua for some 50 years. The airport is named after him and is sort of a shrine to him, which, under the circumstances, is very fitting. They should have stuffed and mounted him and placed him in there for tourists to marvel at, because, you know, we need to pause and think from time to time, about what one man with enterprise, resourcefulness, and cunning can do, even to in a small country, and that little oil painting really doesn't do justice to the scale and scope of his achievement.

Some--not all--you can read in this report from the Center for Strategic and International Studies. [It's a PDF] If you're pressed for time, just read the section about the Bird family and the one titled "Systemic Corruption." You can only wonder how so much crookedness can fit into such a small geographical space. The story of the airport is there. And the story of how the Bird government (under papa V.C.)--the government of a black, Commonwealth country--was caught transshipping arms to the apartheid government of South Africa in violation of the embargo in place at the time; of the arms shipments from some skeezy Israeli arms dealer to the Medellin cartel; Ivor Bird, the youngest of V.C. Bird's sons, boarding a plane for the U.S. with a briefcase containing 25 lbs of cocaine; the smuggling into Antigua of a 1932 Rolls Royce that had belonged to Robert Bradshaw, the late Premier of St. Kitts (the rumor persists that the Rolls was packed up with drugs); steady attacks on civil liberties and on the trade unions; a cheerful lack of curiosity about the provenance of the money that was pouring into the offshore finance sector (regulated, to all intents and purposes, by Stanford); journalists systematically harassed with lawsuits and newspaper offices destroyed in mysterious fires; the most brazen electoral corruption you could hope to see anywhere--they even forged documents on OAS stationery when the OAS was observing the elections. And this list doesn't include the continuous petty corruption, the very essence of the Big Man political culture that is the curse of Caribbean life, the rule of bootoo, the complete lawlessness at the very top, that had ravaged the country. The Birds were not going anywhere, they were entrenched. The CSIS report was written in 1999. Stanford had been in Antigua for 10 years. What do you suppose he was doing there in those ten years? Playing dominoes?

Before moving Stanford Investments to Antigua, he had been in business for 15 years in Montserrat, which is about as close to Antigua as you can be without being in Antigua. Stanford left Montserrat before the 1995 eruption of Mt. Soufriere that buried the capital city, Plymouth, which had been one of the best-preserved and picturesque colonial cities in the Caribbean. Like the other remaining British possessions in the region, Montserrat does offshore business. There is a peculiar charm to the culture of these places. They are very conservative, really rather Victorian, and they still have all these little quirks that remind you of the old ways of colonialism--little Britishnesses everywhere, and a certain quiet stodginess that, you may be startled to discover, is altogether genuine. It's the sort of place where on Sunday everybody is in church and not at the beach. Money deposited there would be--resting, I suppose, in this unhurried gentle environment, a sort of nursing home for your money, where it would be well-looked after by people with charming accents, quaint, old-fashioned Victorian manners. Perhaps when you went and visited your money, it would smell like lavender, floor wax, and freshly ironed linen, or whatever legitimacy, propriety, authenticity, and exclusivity and secure empire smell like. Whatever it smelled like, I'd like to suggest that Stanford got a whiff of it in Montserrat.

Because the very first thing that meets your eyes as you exit the V.C. Bird International airport is the Stanford International Bank, a spick-and-span, imposing Georgian-style building, that manages to be both imposing and discreet. It is impossible, arriving in Antigua, not to ask, "What is that building?" If you visit Antigua and have never heard of Stanford before, this is probably how you will learn of his existence. Why, here is something very large and important that you didn't even know about! Shows how "with it" you are! And then, you see, most offshore operations are really discreet. They don't have a big building dominating the entrance to the airport. One office with a little doorplate, a receptionist at the front, half dead with boredom.

You are not five minutes out of the airport--you don't really feel you've left it--when the next thing you notice is a great big cricket pavilion that looks like no other cricket pavilion on this earth as it is a sort of eruption of Postmodern Ugliosity, vaguely evocative of those really big Chuck E. Cheeses, the ones with the giant mouse in the glass bubble embedded in the wall. This is the Stanford pavilion. You may begin to wonder whether everything in Antigua is named after Allen Stanford. In places like Antigua the airport is a source of national pride. And here is Stanford just crowded up into prime real estate next to it. And what an odd place for a cricket ground. But nobody seems to think there is anything strange about this. And you listen to the way people talk about him and you start to feel as though he has done Antigua the great favor of colonizing it and making it live up to standards. And you don't know what it is about the whole idea that bothers you, and you don't want to think about it because it's not your problem, you're always so cranky and negative, and so you quickly come to regard Stanford as the Great All-Seeing Bore of Antigua,

Or perhaps the Great All-Eating Bore of Antigua.

He ate the offshore sector. He then set to work to devour the government. He did this by lending them money and taking payment in land and who knows all told what other concessions. He seems to want to eat the media. During the period of the Medical Benefits Scandal, in 2000, Lester Bird tried to shut down the two independent and courageous media outlets that in the face of all sorts of intimidation were reporting on the corrupt doings in that complete disaster. This was real journalism. Tim Hector, who founded and ran the Outlet, and the Derrick brothers, are among my journalism heroes. You can read a little about them here. And you may well ask yourself, after you get to this little tidbit--

Yet another legal case involved the firing of two top editors from The Antigua Sun, Louis Daniel and Horace Helps. The firing took place around the time of the 1999 election, in which Prime Minister Bird was returned to office. The paper's owner, R. Allen Stanford, has close ties to Bird. Daniel and Helps were fired when they staged a sickout to protest the spiking of an article that contained critical comments about the prime minister. On December 21, 2000, the Industrial Court ruled in favor of the journalists. Stanford was ordered to pay a total of 72,000 Eastern Caribbean dollars (US$26,000) in compensation and had a month to do so, Daniel told CPJ.

--what did Stanford want to own a newspaper for? Not for freedom of the press, apparently. Tim Hector is dead (whose Outlet archives should be required reading for anyone reporting on Stanford or the Birds), and the one surviving independent newspaper, the Observer, has no resources. I mean, what does Antigua have for a press right now? Stanford could afford to run his newspaper at a loss, or simply wait out the defeat of the competition. But why? Why does there need to be a Stanford newspaper?

What did he want to own an airline for? If you traveled in the Eastern Caribbean during all these years you were having an experience that made no sense. Among regionally based carriers, two dominated the market (That is, I'm not talking about the big ones like American Airlines or American Eagle): LIAT, which had been around since the early 1970s and was owned by a consortium of regional governments (wait a minute--was that socialism I just smelled?), and the Stanford airlines, Caribbean Sun and Caribbean Star (which we might as well consider as one, just for simplicity's sake). They competed for routes, and no matter how low LIAT's prices went, the Stanford fares went lower. LIAT was struggling to keep its planes in the air on the reduced fares that it was charging just to keep within sight of Stanford. So his airlines had to have been losing money. Nevertheless, when LIAT was finally so hard pressed as to have to seek a buyer, he magnanimously stepped forward and ate it. It was a rather peculiar arrangement:

Meanwhile, the Liat, Caribbean Star merger is said to be on track along the same lines as previously announced with the parties to the merger of hope to sign on the dotted within a few days, according to a joint release from both airlines.

The governments of Antigua and Barbuda, Barbados and St Vincent and the Grenadines, which are primary shareholders of LIAT are said to be reviewing an agreement for Liat to purchase Caribbean Star, is expected to be completed by the end of April 2007.

In order to allow the new entity to start debt free, in a separate transaction from the purchase agreement, the Stanford Financial Group will lend US$55 million to the governments of Antigua and Barbuda, Barbados and St Vincent and the Grenadines.

The loan is to allow the governments to provide funds to liquidate LIAT's financial liabilities, as well as to provide working capital. The joint release noted that US$11 million out of the total sum has already been advanced.

The loan is on commercial terms and has been guaranteed by the three governments. It is expected to be repaid to the Stanford Financial Group from the proceeds of an Initial Public Offering of LIAT stock.

Well, I am not brilliant at deal-making, but it looks to me as though Stanford owns that new merged airline until the regional governments and the employees pay off the note. And I notice, too, a resemblance to another deal, Michael Ashcroft's eating of the entire telecommunications infrastructure of Belize; bones guest appearances by WorldCom and Jeffrey Prosser. None of the details of this sale, or much about LIAT's history, are mentioned in the Wikipedia entry for LIAT, where we learn, however, that at least Stanford bought the airline in time for Antigua Sailing Week! He had eaten this prestigious international sailing event some time before.

On April 10, 2008, in celebration of the 41st anniversary of the Stanford Antigua Sailing Week, sailboats will be travelling the skies. As a Silver Sponsor of the Stanford Antigua Sailing Week, LIAT has replaced the usual white fuselage on one of its Bombardier Dash 8 300 aircraft with a brightly coloured, nautical themed livery featuring sailboats on the ocean, as well as the Stanford Antigua Sailing Week logo. The aircraft that was painted is registered as V2-LFU. This happens to be LIAT's first and only special schemed aircraft.

Thirty years of history serving the Eastern Caribbean, and the great thing is that the plane will have some sort of harmonic branding convergence.

[[AQ: Do you mean to suggest that it's been Stanford Antigua Sailing Week for 41 years?]]

What was this about, really? Does it begin to seem even a little crazy to you?

He also owns a sizable chunk of golf, and some soccer, and a charity polo match played at Sandhurst, the British army officer training college.

And how he found room to eat cricket, well, I don't know, but he ate that too. He buys into cricket because of its traditions and then immediately changes the rules of the game and the manner of awarding prizes--that is, dispensing with the traditions that are supposedly part of its appeal to him--arriving on the cricket field in a helicopter, and showing off his own personal plexiglas viewing stand, which (I can't help myself) I envision as some sort of variation on the Chuck E. Cheese thing.

Stanford's facade of respectablity and genteel colonial discretion kept slipping, revealing the leer of the power-drunk vulgarian. To your left, the Georgian building; to your right, Chuck E. Cheese Cricket Pavilion. He becomes Sir Allen Stanford. My first reaction when I heard of his "knighthood" is that the honors system had really gone to the dogs. And then an American just looks like an idiot sporting a title anyway, you're just embarrassed for them. But it is an Antiguan knighthood, and he may well be the only person in the world to possess such a thing.

There were the two newspapers, one in Antigua and one in St. Kitts, launched apparently with a view that serious good journalism was that which supported Allen Stanford and all whom he blessed with his smiles. Any other function of a newspaper--provided it did not conflict with the primary purpose--was simply the overflowing of his bounty. It was all about controlling appearances while corrupting the original thing, the concept of what a newspaper could or should be expected to do. And it never seemed to cross his mind that Antiguans might deserve better than this.

Outside of the region it was impossible to see these things over the years. I mean, if he said he was a descendant of Leland Stanford, why not believe him? Why bother to check it out? You don't check out billionaires.

He was investing in prestige, which all tended to the creation of the appearance of legitimacy that would hook the sort of rich customers he wanted. It was the duty of Antiguans to support his credibility. They had an interest in believing it or at least helping to sustain it. How much choice did they have? Not everybody had Tim Hector's courage. If it turned out that the people of Antigua could not look within the institutions of their own society for justice and truth, well, that was the free market for you. If you didn't like it, you could leave your Stanford-created job and sit at the side of the road and eat breadfruit. This is the context in which it is necessary to view Stanford's charitable activities and all his purported benefits: when a person cheats you of justice, you do not owe him gratitude for charity. Charity is his way of paying less than he owes, and the more noise he makes about his goodness to you, the greater the discount he is taking.

But there's this other dimension; these activities are his self-expression, the creation of an identity as a benign Big Man who enjoys the finer things in life (airlines, golf, cricket). Looking at his career you are looking at the howling chaos of that peculiarly American characterlessness--of people who are driven to manufacture themselves out of prefabricated materials, who seem to be fleeing some horrible knowledge of the self that must shun the light of day. Just as he believes that freedom of the press exists if he owns a newspaper, so he believes that he his self exists if he can read his name on the side of an an airplane. You don't know whether it is just ignorance or the grossest cynicism; maybe it's alternating layers of both.

When I was in St. Kitts he had what appears to have been a falling out with Lester Bird. The Medical Benefits Scandal had been very damaging to Bird. Stanford announced that he was going to move his airline and real estate operations to St. Kitts. Stanford bought prime lands next to the Robert Bradhsaw airport, just outside of Basseterre, paying pennies on the dollar for them. This land happened to be the playing field for the village of Conaree, just past the airport, but of course the playing field would have to go. Government would get them a new playing field. Stanford needed the airport lands and he needed them now. You did not dilly-dally with a billion dollars. Why should Antigua have all the benefits? Odd, isn't it, how you have to keep giving and giving and giving things to the man who has a billion dollars. What if you just stopped? What if you just said, "No, go away, we don't need it, piss off." I left St. Kitts and Nevis in 2004. Shortly afterwards, Stanford apparently came to an accommodation with Bird, who issued a statement denying there had ever been any problem, but he lost the elections that year anyway. The newspaper in St. Kitts kept going (though I don't know what their fate will be if he can't continue to subsidize them), but the offices on the Conaree playing fields were never completed. The landscape of the Caribbean is littered with the ruins of such follies.

Like Little Nut, he had begun using his own product--not just the investor cash that he was burning up, but the fiction about what he was doing, and the myth of identity that he went to such lengths to create.

There may be yet a third dimension.

But independent banking consultants said Stanford mainly tempted clients with the promise of outsize returns that in fact created risk with two sister companies taking in clients. Francisco J. Faraco, an economist who specializes in the Venezuelan banking system, said Stanford had done brisk business in the last two years by luring Venezuelan depositors with dollar-denominated certificates of deposits from Antigua.

By putting their money in such securities, Venezuelan investors are believed to have both contributed to the capital flight that has weakened the local currency — the bolívar — and profited from it, transferring hard currency back to Venezuela on the black market to acquire some goods denominated at the official exchange rate.

Mr. Faraco estimated that as much as 30 percent of Stanford International Bank’s $8 billion in reported assets last year came from Venezuelans.

It was the second time in five months that Stanford was embroiled in intrigue in Venezuela. In late October, agents with the Military Intelligence Directorate carried out a raid on Stanford’s headquarters here. In statements to state television, government officials said the raid was related to suspicions of espionage by three Stanford employees.

They also claimed to be searching for information on offshore accounts held by Manuel Rosales, a prominent opposition politician who ran against Mr. Chávez for the presidency in 2006. Mr. Rosales is currently the mayor of Maracaibo, Venezuela’s second-largest city.

“They were seeking information on some former employees of the bank who were under investigation in an espionage case here in Venezuela,” Ms. Hernández, the Stanford spokeswoman, told The Times. “The case did not advance.”

Stanford has also previously drawn the gaze of law enforcement officials investigating money-laundering activity in the region.

Someone, no doubt, is watching over him.