Page last updated at 05:10 GMT, Friday, 27 February 2009

Stanford official arrested by FBI

Sir Allen Stanford - file photo 11/06/2008
Sir Allen has been served with civil legal papers

The FBI has arrested a senior official at the troubled Stanford Financial Group of US tycoon Allen Stanford as part of an ongoing fraud investigation.

Chief investment officer Laura Pendergest-Holt was detained in Houston on federal obstruction charges.

Ms Pendergest-Holt's attorney said she was "looking forward to having the truth come out".

Sir Allen is accused of $8bn (5.6bn) fraud by the Security and Exchange Commission, the US financial watchdog.

Last week, FBI agents served the Texan billionaire with civil legal papers from the SEC.

The SEC has described the case as a "fraud of shocking magnitude".

The cricket impresario is accused of luring investors with promises of improbable and unsubstantiated high returns on certificates of deposit and other investments.

Court appearance

Ms Pendergest-Holt was arrested in Houston - the headquarters of Stanford Financial Group.

The government alleges that she obstructed the SEC investigation by failing to reveal how much she knew about investments in the Antigua-based Stanford International Bank.

A federal complaint against Ms Pendergest-Holt also says she did not tell investigators that she had served on the bank's investment and had known about a $1.6bn (1.1bn) loan to a shareholder.

Ms Pendergest-Holt would appear in court on Friday, the FBI said.

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