First Madoff, Now Stanford

My friend Rick P (aka Yogui) has suggested me to address the issue surrounding Stanford Bank and fraud allegations and government intervention of a global banking institution. Asides from value judgments this is like a wet dream for any banking and finance attorneys. And for bankruptcy attorneys well it’s like hunting such a huge animal only comparable to a huge Tuna, definitely more meat than teethes to sink in.

What really gets my attention is this fellow Robert Allen Stanford. He comes from Mexia, Texas (a small town in Texas) yet officially resides in the US Virgin Islands and is an honorary citizen of Antigua. He was born in 1950, which roughly makes him 59 years old. He officially holds no formal education, not even a community college degree, at least made public. Stanford International Bank became global from its operation in Antigua during the last 10 years. What really gets my attention is that this bank from Antigua was targeting Latin American investors. Specifically, investors between the figures of 250K all the way up to 20 million dollars. To this date, Stanford Banks have been controlled by governments in Mexico, Panama, Venezuela, Ecuador and Peru.

The Banks experience was directly from Allen Stanford real estate experience and his board, comprised mainly by his college roommate (did he drop out from college? or what?), his father, Laura Pendergast-Holt (a hot chick, apparently Stanford’s mistress) and a resident from Mexia, Texas.

Mr. Stanford has had quite a joyride throughout the years, living a lavish lifestyle while remaining savvy with his greedy Latin American friends. Now, the fraud was not only in Latin America. The fraud permeated the United States, where the SEC and the FBI had to intervene when they found out that Stanford was offering an insane percentage against cash in Certificates of Deposits (CD). Now, US government officials conducted their investigations in Antigua (what? now Antigua is US jurisdiction?), and have seized property belonging to Stanford in Stanford International Bank and ordered the repatriation of cash to the United States.

What really baffles me is that Stanford Bank was being sued by Stanford University, because Allen Stanford alleged that his great-great-great-great grandfather was related to the found of Stanford University. Also being sued by St Judes Cancer Hospital, because Stanford had represented in its financial statements that they made a contribution of 15 Million Dollars, which they never received.

As of yesterday the FBI issued a press release statement disclosing to the public that Stanford Bank may have laundered money for the Cartel of Gulf (Mexico’s worst drug cartel operation), which now makes sense to have operations throughout Latin America, including Peru, Ecuador, Colombia and Venezuela...And for the FBI to release such a statement translates into what they think professionally before they present the case to a Federal Judge on legal grounds. Time will only tell, but when the news come do not be a stranger...

NY Post a racist according to Al Sharpton

Do you think this cartoon is racist? According to Al Sharpton this cartoon published by NY Post depicts racism against the Black President, Barack Obama. I truly disagree, I think that the author was relating to the chimps in DC that drafted the Stimulus Plan, which was by the way, really huge...

the end of Facebook?

I seriously predict that Facebook users will dramatically come down. I think that users will migrate their profiles to other, smaller and more targeted online communities. Online communities that will identify with each user, instead of a mega web site where you can find virtually anyones profile and ask them if they can join you as a virtual "friend". In my case I intially joined Facebook when I was at law school in 2006 and I remembered that I closed my account because of people asking him to join them as friend, even though I met them the night before...

Its not that I hate social networking, in fact, I think its important. Nowadays I have a profile and am a member of a closed social network website, ASW.

I think Mark Zuckerberg should sell the site before it looses more and more value...


Facebook backs down, reverses on user information policyStory Highlights

Outraged members canceled their accounts or created online petitions

On Wednesday, Facebook reviewed user "feedback," and reverted to its old policy

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(CNN) -- Under fire from tens of thousands of users, the social networking site Facebook said early Wednesday it is reverting to its old policy on user information -- for now.


Backlash against Facebook began after a consumer advocate site flagged Facebook's policy change.

The site posted a brief message on users' home pages that said it was returning to its previous "Terms of Use" policy "while we resolve the issues that people have raised."

The "Terms of Use" is the legalese tacked on to the bottom of most Web sites that details what the site's owners can do with the information that users provide.

Facebook, the Web's most popular social networking site, has been caught in a content-rights battle after revealing earlier this month that it was granting itself permanent rights to users' photos, wall posts and other information even after a user closed an account.

The popular site allows users to create personal profiles where they can then connect with one another, upload photos and share links. The site boasts more than 150 million active users.

Member backlash against Facebook began over the weekend after a consumer advocate Web site, The Consumerist, flagged a change made to Facebook's policy earlier in the month.

The company deleted a sentence from the old Terms of Use. That sentence said Facebook could not claim any rights to original content that a user uploaded once the user closed his or her account.

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Facebook faces furor over content rights
It replaced it with: "You may remove your User Content from the Site at any time. ... (H)owever, you acknowledge that the Company may retain archived copies of your User Content."

In response, Chris Walters wrote in the Consumerist post, "Make sure you never upload anything you don't feel comfortable giving away forever, because it's Facebook's now."

Thousands of indignant members either canceled their accounts or created online petitions. Among them were more than 64,000 who joined a group called "The People Against the new Terms of Service."

On Monday, Facebook Chief Executive Mark Zuckerberg tried to quell the controversy by saying the company's philosophy is that "people own their information and control who they share it with."

But members were not appeased because the site did not fix its Terms of Use. The company, in its post Wednesday, said it was returning to its previous Terms of Use because of the "feedback" it had received.

"As Mark expressed in his blog post on Monday, it was never our intention to confuse people or make them uneasy about sharing on Facebook," company spokesman Barry Schnitt said in a blog post. "I also want to be very clear that Facebook does not, nor have we ever, claimed ownership over people's content. Your content belongs to you."

Schnitt said the company is in the process of rewording its Terms of Use in "simple language that defines Facebook's rights much more specifically."

Who is Valentin Santana ? La Piedrita, anyone?

Valentin Santana is the leader of an urban "collective" movement (La Piedrita) that seeks to protect the poor against the oppression of the state in a Venezuelan barrio (slums, projects or shankytown) called 23 de Enero in Caracas. Their name derives from being a "little stone" on the shoes of criminals, the empire or the oppressor.

Valentin Santana has claimed responsibility for criminal acts against Venezuelan private citizens (Marcel Granier, Alberto Federico Ravell and journalist Martha Colomina) just because they publicly oppose Chavez´s regime. He has publicly said through Venezuelan media that opposition leaders must be "executed". What is really insane is that this fellow has publicly violate the law by threating private citizens and tagging them "enemies of the revolution" or "representatives of the empire" and that they must be passed through revolutionary weapons.

What is worse, Venezuelan President Hugo Chavez, has publicly ordered the arrest of Valentin Santana. Chavez claims he is vital for peace in Venezuela. Still, to this date, Valentin Santana has remain free and vocal, even giving interviews to reporters from his military style bunker in Caracas.

Here you can see him with his shirt "Diego" which was his son, who was allegedly killed by Tupa Amaros (social group with ties with Chavez)...

Tocqueville and the Tyranny of the Majority

Alexis de Tocqueville was a French Political thinker that revolutionized the conception of democracy in the United States of America. He wrote about the democracy in the United States as a example to be followed by European governments.

Concerning the tyranny of the majority, de Tocqueville argues that there is little toleration of difference of opinion in democratic societies. Unlike in aristocratic societies, public opinion is seen as authentic rather than ascribed, and therefore has a great deal more moral force.

He argues that In USA, the government is exposed to the whims of the majority. Particularly in the legislature, which is elected at short intervals,representatives must act on public opinion in order to stay in office.

Furthermore, "the moral authority of the majority is partly based on the notion that there is more intelligence and wisdom in a number of men united than a single individual, and that the number of legislators is more important that their quality".
Yet another principle ensures the moral power of the majority. It is that "the interests of the many are to be preferred to those of the few".

A danger of democracy is that it can crush independence of thought:

"I know of no country in which, speaking generally, there is less independence of mind and true freedom of discussion than in America [...] As long as the majority is still undecided, discussion is carried on; but as soon as its decision is irrevocably pronounced, everyone is silent, and the friends as well as the opponents of the measure unite in assenting to its propriety "

In Europe, a person at odds with a repressive government can usually find shelter somewhere. If their opinion is at odds with an aristocratic government, then they can usually find security with the general populace. If it is at odds with the populace, the opposite is true.

The censure delivered on dissenters is much harsher in democratic societies than in aristocratic societies. In aristocratic societies one is tortured and punished but one's soul escapes. In democratic societies, "the body is left free and the sould enslaved":

“The sovereign can no longer say, “You shall think as I do on pain of death”: but he says, “You are free to think differently from me, and to retain your life, your property, and all that you possess; but if such be your determination, you are henceforth an alien along your people. You may retain your civil rights, buy they will be useless to you, for you will never be chosen by your fellow-citizens, if you solicit their suffrages; and they will affect to scorn you, if you solicit their esteem. You will remain among men, but you like an impure being; and those who are mostly persuaded of your innocence will abandon you too, lest they should be shunned in their turn."

Given this overwhelming moral power of "majority opinion", its ability to ostracise, and its tendency to enforce conformity, it is possible that the average person may simply abdicate responsibility for taking part in political debate and accept majority opinion as his own. De Tocqueville argues that this is a fault of democracy in general, rather than democracy in America.

Tocqueville states that "unlimited power is itself a bad and dangerous thing. Human beings are not competent to exercise it with discretion." Only God, in his perfection, is fit to exercise such power. When absolute command is conferred on any power, there is a germ of tyranny. The main problem with the democratic insitutions of the United States comes their irresistible strength. "I am not so much alarmed at the excessive liberty which reigns in that country as at the inadequate securities which one finds there against tyranny."

If a party is wronged, the only entity that one can turn to is the majority. The majority controls the legislature, the executive and courts.

"If the free institutions of America are destroyed, that event may be attributed to the omnipotence of the majority, which may at some future time urge the minorities to desperation and oblige them to have recourse to physical force.".

Tocqueville cites Madison's Federalist 51, where Madison states his opinion on faction. He states that it is of paramount importance to protect the weak against the strong, and prevent the oppresion of fractious majorities. Madison argues that the real danger is the tyranny of the legislature, which is so exposed to the whims of the majority.

An Example of the Tyranny of the Majority

In the chapter "The Unlimited Power of the Majority", De Tocqueville cites two examples of the tyranny of the majority.

During the war of 1812, a newspaper in Baltimore had taken the opinion of the other side, and "excited the indignation of the inhabitants". The mob attacked printing presses, the militia was called out, but did not respond. The only way of saving those threatened was to throw them into prison. The prison was then forced upon and the editors killed. The guilty were acquitted.

The other example is that of black voters. The blacks were ostensibly allowed to vote, but De Tocqueville is told that they "volutarily abstain from making their appearance" at the voting booth, because they are afraid of being bullied or mistreated.

"The law is sometimes unable to maintain its authority without the support of the majority".

The majority, De Tocqueville concludes, have the right not only to make the laws, but to break them as well. It is only another instance of the importance of mores and values.

Tyranny of the Majority (Venezuelans approve amendment concerning no term limits for public officials)

No term limit for Venezuelan elected officials

Venezuelans yesterday, Sunday February 15, 2009 have approved in a public referendum to ammend the constitutional provisions that limits the terms for elected public officials, including the President, Governors, Assembly Representative (parliamnent or congress), Mayors and Deputies before State or local Councils.

The victory of the Yes proposition was 54% over 46%, in a 9% difference. The only States in Venezuela where the proposition No won over yes where: Zulia, Tachira, Merida, Miranda and Nueva Esparta. Which means that most of Venezuelans approve the government of Chavez...

What remains true, is that Chavez totally abused the powers of the Presidency for his campaign, it was outright insane.

The answer lies now in Campaign Finance Reform laws in Venezuela. Currently the legal framework resides in the Organic Law of Electoral Power and the Organic Law for Voting and Political Participation. What is even worse, Venezuelans must now turn their opinion and enable institutions to control the National Electoral Power (Consejo Nacional Electoral, or CNE) in their duties to moderate the participation of elected officials in their election campaigns. But I guess that is too sofisticated even for Venezuelans...