Cricket entrepreneur Sir Allen Stanford has been charged in the US over an alleged 7 billion US dollar (£4.2 billion) fraud.

The 59-year-old was indicted on fraud and obstruction charges alongside other executives of his firm, Stanford Financial Group, the US Justice Department announced.

The tycoon handed himself in to the FBI yesterday ahead of a court hearing today.

Stanford already faces civil charges brought by US regulators over an allegedly fraudulent eight billion US dollar (£4.8 billion) certificate of deposit scheme and a separate 1.2 billion US dollar (£700 million) investment vehicle.

Stanford's arrest in Virginia yesterday was followed today by that of Gilberto Lopez and Mark Kuhrt, Stanford Financial Group's (SFG) chief accounting officer and global controller.

The company's chief investment officer, Laura Pendergest-Holt, has also been charged over the alleged fraud.

According to the charge sheet, Stanford and his co-defendants masterminded a scam in which investors were sold around 7 billion US dollars (£4.2 billion) worth of so-called certificates of deposit (CDs) after being lured by above-the-odds returns.

CDs are fixed-term investment products which are supposed to the virtually risk-free.

Regulators in the US have claimed that Stanford and his firms "misrepresented" to investors that their money was safe, falsely claiming the bank re-invested client funds primarily in "liquid" financial instruments and was monitored by a team of 20-plus analysts.

Instead, Stanford and his co-accused misused and misappropriated the funds, it is alleged.

The US Department of Justice claims that 1.6 billion US dollars (£1 billion) was diverted to Stanford himself through undisclosed personal loans.

The defendants are also charged with conspiracy to commit mail, wire and securities fraud.

Announcing the charges, Kevin Perkins, assistant director at the FBI Criminal Investigative Division, said: "Economic crime schemes such as those alleged here today are unfortunately all too commonplace.

"These crimes strike at the heart of our economy and our quality of life."

Gregory Campbell, deputy chief inspector at the US Postal Inspection Service said: "Robert Stanford's investors trusted him and his associates, in many instances, with their life savings."

Stanford has denied the charges.

In a written statement, the tycoon's lawyer, Dick DeGuerin, said his client was "confident that a fair jury will find him not guilty of any criminal wrongdoing".

Mr DeGuerin added that Stanford has been working to challenge the "false allegations against him" since February, when the Securities and Exchange Commission initially made its civil complaint.