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SEC Poised to Sue Securities Investor Protection Corp. (SIPC) over Stanford Ponzi Scheme

The Securities and Exchange Commission has decided to take the unprecedented step of suing the agency that insures U.S. brokerage accounts to force it to pay victims of Allen Stanford’s ¬†alleged $7 billion Ponzi scheme.

The SEC plans to sue the Securities Investor Protection Corp. as early as Monday or Tuesday to compel a liquidation to compensate Stanford customers, according to the Wall Street Journal.

The lawsuit would be the first ever by the SEC against SIPC, according to officials from both agencies, and would come just days after negotiations between the agencies appear to have reached an impasse.