VIDEO: Venezuelans Want Stanford Money Back

An estimated one-third of the money invested in Stanford International Bank is Venezuelan, the national banking regulator said.

Venezuelans have about $2.5 billion invested in Stanford International Bank, an official said on Wednesday, as hundreds of investors besieged its local offices after U.S. authorities charged the company with fraud.

An estimated one-third of the money invested in Stanford International Bank is Venezuelan, the national banking regulator said. Worried clients packed into the bank's offices in Caracas, trying fruitlessly to withdraw investments.

"I heard the news and came straight down. We've had money here for two years and I want it back," said Caracas resident Josefina Moreno, who added her son had about $10,000 invested.

A Stanford executive in Venezuela said he had worked for two days without sleep and received hundreds of calls. He said all accounts were frozen and pleaded for people go home and wait for information.

Texas billionaire Allen Stanford was charged on Tuesday with "massive fraud" related to the Stanford International Bank as well as his Houston-based broker-dealer and investment units.

The U.S. Securities and Exchange Commission accused him of fraudulently selling $8 billion in high-yield certificates of deposits in a scheme that stretched around the world.

Despite the scale of the Venezuelan investments the fallout on the wider economy is expected to be minimal because the money was held offshore.

Wealthy Venezuelans often keep their money overseas for fear of political instability under socialist President Hugo Chavez. Used to high returns in the oil-exporting nation, Venezuelan investors were attracted by Stanford's interest payments and helped the investment group grow rapidly.

The fraud case had an impact in other parts of Latin America with Panama regulators taking over a Stanford affiliate there and a local arm of Stanford Financial Group halted its activities on the stock exchange in Colombia.

The Stanford Group operates banks, brokerages and other companies in countries that also include Mexico and Ecuador.

Stanford International Bank is no stranger to controversy in Venezuela. In October, military intelligence officials raided it in a case involving accusations of U.S. spies. The raid came after officials linked to the bank visited the country using conspicuous bodyguards from America, a Venezuelan industry official familiar with the group's operations said.

A few years ago, Stanford's Venezuelan retail bank was embroiled in a tax fraud controversy with the government that was finally settled out of court.

Against the backdrop of worried Venezuelan investors at Stanford International Bank, officials sought to calm clients of a Venezuelan sister company, whose assets are not linked to the business that is the target of the fraud charges.

The banking regulator said Stanford Bank Venezuela, one of the country's smallest retail banks, has healthy finances.

The vote of confidence came after Stanford Bank Venezuela said its assets were not linked to Stanford Group.

At a main branch of the retail bank in Caracas, there were no long lines but some people wanted to take their money out.

"I heard (the news) on the radio and practically ran over here in my pajamas. I know it's bad if everyone takes their money out but at the end of the day, it's your personal savings," said Karin Dahan, 37, a businesswoman.

Many Venezuelans remember a 1994-1995 crisis that cost the country $11 billion as half the country's banks fell.

Chavez, who blames problems in the global banking system on capitalist greed, said last year he would expropriate any bank that failed rather than bail it out.

A local banking official who requested anonymity said Venezuelan business was an early motor of growth for Stanford International Bank, although investments from the OPEC nation into the bank have dropped off in recent years.

Watch the VIDEO: Stanford clients swarm banks