Friday 13 April 2012

Stanford's swindled victims want his political donations


Convicted financier has given millions to GOP, Democrats

By Emily Wilkin, Houston Chronicle

WASHINGTON - Before his arrest, convicted swindler R. Allen Stanford was a
prodigious political donor, a billionaire financier who along with his
employees had given nearly $2.4 million to both Democrats and Republicans
since 2001.

But Stanford's victims and the court-appointed receiver assigned to recover
money stolen by Stanford are demanding politicians return the money to them
- claiming the funds are ill-gotten gains in the form of campaign
contributions.

The result has been a complex legal battle that pits politicians - including
eight members of the Texas congressional delegation - against some of their
constituents in an unusual matchup that has both sides crying foul.

"At every turn, someone is there to in some way limit or reduce the recovery
for Stanford victims, "There are so many facts of this case, and none are
working to the advantage of the victim."

Stanford was convicted on 13 counts of fraud earlier this year after running
a $7 billion Ponzi scheme for decades.

As is the custom when politicians discover that a donor is enmeshed in
scandal, many of the recipients - such as Texas Republican Sens. Kay Bailey
Hutchison and John Cornyn - gave their Stanford donations to charity.

The court-appointed receiver working to get back the funds has sent letters
to all recipients of political contributions from Stanford and his company's
political action committee asking them to return the donations. The list of
those yet to repay, according to the receiver, includes five national party
committees, one Texas-based PAC, both Texas senators and six Texas
representatives - Pete Sessions of Dallas, Pete Olson of Sugar Land, Kevin
Brady of The Woodlands, Lamar Smith of San Antonio, Sam Johnson of Plano and
Joe Barton of Ennis.

Committees Sued

The situation has gotten so contentious that the receiver, Ralph S. Janvey,
sued five political party committees, both Democratic and Republican, to
recover Stanford's contributions plus legal fees. The committees allege that
the fees are too high.

Brian Walsh, a spokesman for the National Republican Senatorial Committee,
said that his committee, which received about $83,000 from Stanford, "has
made a good faith effort to resolve this issue."

"Unfortunately, those efforts were rejected by attorneys for the receiver
who appear more focused on lining their own pockets than ensuring Allen
Stanford's victims receive some justice," said Walsh.

Request 'appropriate'

Kevin Sadler, the lead lawyer for the court-appointed receiver working to
get back the funds, said the receiver believes the request is "appropriate
given the size, the scope and the complexity and the difficulty of work he
and his professional team is undertaking."

The battle has left everyone dissatisfied.

"(The fees) have been excessive, I believe," the Stanford victim said. "But
the court has said they've been fair."

All but Brady and Olson said they had made charitable donations equal to the
amounts Stanford gave to their campaigns, and Olson's office maintains that
he also returned all of Stanford's contributions to the receiver.

Sadler said lawmakers giving the money to charity was a "meaningless act."

"The fact they gave money away to some other charity doesn't mean they're
not in possession of money that doesn't belong to them," Sadler said.

Melanie Sloan, director of Citizens for Responsibility and Ethics, a
Washington-based watchdog group, said the case is a complicated for
politicians.

"I think they thought they would be doing the right thing (by donating to
charity)," Sloan said. "It doesn't matter what's correct or not. It matters
what the political ads will say."

None of the representatives and senators responded to questions about why
they chose to give the funds to charity rather than the victims, with the
exception of Cornyn, who said it was his standard procedure in these
instances to donate the funds to charity.

"It's personally kind of insensitive, If you are going to return money, give
it to the victims that it came from. If we had wanted to make a donation to
charity, we would have done that."

Transfer a tough sell

But it's been a tougher sell to get lawmakers to transfer the donations to
the victims' fund. According to the receiver, four Texas lawmakers - Rep.
Randy Neugebauer, R-Lubbock; Rep. Lloyd Doggett, D-Austin; Rep. Mike McCaul,
R-Austin; and Rep. Charles A. Gonzalez, D-San Antonio - have sent the
receiver donations given by Stanford.

Olson, a Republican from Sugar Land, has paid back $3,300 of the $5,300 he
received from Stanford, according to the receiver. However, an Olson
spokesperson said the $3,300 was all he and his campaign were given by
Stanford.

A Texas district court determined last June that the committees have to
repay all contributions plus attorney's fees, but the committees have
appealed the decision. It will be argued in appeals circuit court May 1.

No comments:

Post a Comment