The US financial regulator was today under mounting pressure to explain how Allen Stanford escaped scrutiny despite warnings raised by his employees several years ago.

Senior staff at the Houston-based bank of the Texan billionaire disclosed today that they had been concerned as early as 2003 about the cricket impresario's financial dealings.

However, no action was taken by the Securities and Exchange Commission (SEC) until Mr Stanford’s operations were raided and shut down on Tuesday.

Dennis Kucinich, the chairman of the Domestic Policy Subcommittee in the House of Representatives, said today that Congress would investigate the “mechanics of the fraud” to find out why Mr Stanford was able to evade the SEC's clutches for so long. He claimed that the regulator may have been guilty of failing to do its job.

The development came after the FBI finally tracked down Mr Stanford to the Virginia town of Fredricksburg last night, served him with legal papers and confiscated his passport.

Police today forced back a crowd of reporters, photographers and television crews from outside the house, which is owned by the father of Mr Stanford’s girlfriend.

As the fallout of charges against Mr Stanford continued to reverberate around the world, the England and Wales Cricket Board (ECB), confirmed today that all contractual links with the billionaire had been severed.

English cricket’s governing body announced that they would not play any further Stanford Twenty20 matches in Antigua and had also cancelled plans for the Quadrangular Twenty20 events - the first of which was due to take place at Lord’s this May.

Among a growing number of former employees who said they registered their concerns was Charles Hazlett, a Miami broker, who disclosed that he had sold $10 million in certificates of deposit in a single quarter of 2002 and the company rewarded him with a new BMW.

However, when he asked questions on behalf of a client about the investments' details, he was ordered to resign or be sacked. “As I started questioning things at the bank, they were setting up to let me go,” he told the Associated Press.

His suspicions were aroused, he added, by the promise to investors of earning twice the normal rates on certificates of deposit, the lack of detailed balance sheets kept by the company, and Mr Stanford's use of the obscure accounting firm Charlesworth Hewlett, run out of a small office in Enfield, North London.

In choosing to hire little-known accountants, Mr Stanford's alleged fraud appears to have followed a similar pattern to that of Bernard Madoff, who ran a $50 billion pyramid sceheme for years. Critics say that he, too, had been reported to the SEC years earlier but that little appeared to have been done.

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