Here at FT Alphaville we’ve questioned before the $50bn figure touted by Stanford Financial as total assets “under advisement”. Apart from the $8bn or so at SIB, we could find neither hide nor hair of the rest.

We wrote earlier, for example, that the Stanford Group Company – the Stanford brokerage outfit – only seemed to have around $147m in assets, according to its latest account filings with the SEC. And we suggested that a possible location for some of the other billions Stanford claimed as assets , notwithstanding those at Stanford Investment Bank in Antigua, might actually be with clearing brokers.

By which we meant that Stanford Group Company, even though a broker, was not necessarily economically liable for its clients money as a custodian. Rather, like so many other smaller or medium-sized brokers in the US, it only served as an introductory broker. So while Stanford effectively “managed” client accounts, larger clearing brokers undertook to process and hold them – and according to SEC regulations, bear the economic risks of those accounts, holding cash in reserve for them, etc.

But it transpires that even with the funds held by clearing brokers taken into account, we are not brought any closer to the $50bn “assets under advisement” figure.

Just how much client money does the Stanford Group Company brokerage handle then?

Here, via the SEC’s investment advisor service, is a breakdown:

Quite far from the circa $40bn we’re looking for.

Here, though- of even more interest – is a little more colour on that brokerage client money (click to enlarge):

We’ve also dug up the trading records.

Stanford Group Co, being a registered market participant, is obliged to supply records of its trading volume in US listed equities. You can view the records in detail here, at Nasdaq (the code for stanford group co is STFG) though you’ll need to briefly register first.

For example, though, here is the rather small amount (broken down by sector and exchange) Stanford Group Co traded – for clients – in November 2008 (click to enlarge):

Of course, those clients that simply used Stanford as a broker to make such trades aren’t necessarily in trouble. Their funds and securities are, afterall, held at the clearing brokers, not at Stanford. The problem is if any of those clients were persuaded to purchase CDs from a certain other Stanford service…

And that’s the really odd thing. Because that certain other Stanford service – SIB (which professed, forget not, to be invested in highly liquid bonds and equities, mostly in the US) – wasn’t using Stanford Group extensively as a broker to execute its own trades.

How could it be? Per the above, Stanford Group Co only acted for $3bn of funds. SIB had $8bn.

Madoff, of course, had a brokerage outfit too – one which his fund didn’t use.

This entry was posted by Sam Jones on Wednesday, February 25th, 2009 at 17:38 and is filed under Capital markets, People. Tagged with Sir Allen Stanford, Stanford, Stanford Financial, stanford group company, Stanford International Bank. Edit this entry.