Research as a “Badge of Respectability”

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New York – We have been following, with a great deal of interest and no small degree of dismay, the ongoing developments at Allen Stanford’s Stanford Financial Group, which is currently under investigation by FINRA and the SEC. One of the interesting aspects of the story, for us, will be to see what happens to Stanford’s institutional research business – particularly it’s Washington-focused policy research practice, which was formerly known (and widely respected) as the Washington Research Group. As noted by BusinessWeek:

As his financial empire has expanded, the financier’s stature has grown. In 2004, he purchased Charles Schwab’s (SCHW) Washington Research Group, an esteemed analysis firm. Another badge of respectability: Lyle Gramley, a former Federal Reserve Governor, serves as an economic adviser to the research arm. Gramley says that he doesn’t know anything about Stanford Financial’s CD sales and that he’s only a consultant on overall economic strategy.

Although we have no reason to believe that that any of Stanford’s research personnel are implicated or involved with the current investigation, the outlook for these businesses can at best be described as grim.

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