Thursday, 30 October 2014

KLS - Stanford SEC Update

Here is an update from Kachroo Legal Services regarding the appeal against the SEC

Read More here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum

Tuesday, 28 October 2014

Fifth Circuit to convict Allen Stanford: Follow the rules or risk losing chance to be heard

Former Houston billionaire Allen Stanford,
convicted in 2012 of operating a Ponzi scheme
that defrauded more than 18,000 investors, is
appealing his conviction. He's currently serving
a 110-year sentence. File photo.

WASHINGTON — The appeals court that will hear former Houston billionaire Allen Stanford’s appeal has sent him a blunt warning. Keep breaking the rules when it comes to filing your appeal, and he may lose his chance to be heard at all.

 That’s the message sent last week when the Fifth Circuit Court of Appeals in New Orleans wrote Stanford a letter telling him that the court has filed his latest brief arguing that his 2012 conviction was illegal. “However, you must make the following corrections within the next 14 days,” an Oct. 23 letter from the court to Stanford reads.

 Adds the court clerk: “As this is the second request to make your brief sufficient, any further insufficiencies received may move the court to strike your brief and dismiss your appeal.”

 Stanford was sentenced to 110 years in prison, and is serving his term in central Florida. He has fired his lawyers and is representing himself. He filed a 299-page appeal in September, which the court promptly rejected as too long. He was given to Oct. 6, and then an extension to Oct. 22, to make it conform to the already-relaxed guidelines stipulated by the court.

 He made the deadline, but still wasn’t following the rules. He’s now been ordered to strip out all of the attachments he has sent that aren’t “opinions, statutes, rules, and regulations.” He’ll also have to get three more copies of the brief made.

 Stanford’s new brief is 174 pages, including exhibits and other appendices. His initial brief was 299 pages.

 Murray Waas of Vice Media and I reviewed the contents of his initial arguments here. He has until Nov. 6 to make the requested changes. The U.S. government will respond to the brief with an argument of their own for why he’s right where he belongs, before three judges on the 5th Circuit will make a ruling.

Allen Stanford's Revised Appeal can be read here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum

Thursday, 23 October 2014

Could Allen Stanford go free? Convicted fraudster appeals

Indicted financier R. Allen Stanford exits the Bob Casey Federal Courthouse in Houston, Texas.

Jailed financier R. Allen Stanford, convicted in 2012 of running a massive global Ponzi scheme that rivals the Madoff scandal, says he is the victim of an illegal prosecution, and "the clearest of assaults on the U.S. Constitution."

 The comments come in Stanford's formal appeal of his conviction, filed in federal court on Wednesday. Stanford wrote the appeal himself at the prison in Florida where he is serving a 110-year sentence. Having fired the last of a string of court-appointed attorneys, and with no funds to hire a replacement, he is representing himself even though he has no legal background. He has also asked to argue his case in person before the Fifth Circuit Court of Appeals in New Orleans, a task normally handled by experienced attorneys.

 Stanford calls the case against him a "reckless action," and accuses authorities of a "by-any-means pursuit" of him to cover up their missteps in the still-unfolding financial crisis.

Read More here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum

Friday, 17 October 2014

Ponzi Receiver Can Go After Tiger's Charity

DALLAS (CN) - The court-appointed receiver for R. Allen Stanford's $7 billion Ponzi scheme can go after the Tiger Woods Foundation charity for $500,000 in alleged fraudulent transfers, a federal judge ruled.

 Ralph Janvey, a partner with Krage Janvey in Dallas, sued the Tiger Woods Foundation and Tiger Woods Charity Event Corp. in April. He claimed they received the money in two transfers from Stanford Capital Management LLC, Stanford Financial Group Co. and the Stanford Financial Group Building Inc. Janvey claimed the money was from " innocent, unwitting " Stanford investors.

 U.S. District Judge David C. Godbey denied the defendants' motion to dismiss on Wednesday, finding that the charity could not prove Janvey's claims are time-barred.

 Godbey said the foundation relies on "far too many factual ambiguities" for its motion to be granted. 

Janvey's fraudulent transfer claim under Texas law has a 4-year statute of limitations; his unjust enrichment claim has a 2-year limit. "

The parties agree that the relevant date of reference here is December 13, 2013, the date on which the parties signed the tolling agreement," the 9-page order states. "Thus, the Receiver's [fraudulent transfer] claim is time barred if he could have discovered it before December 13, 2012, and the unjust enrichment claim is time barred if it accrued before December 13, 2011. The Receiver argues that because he pleads the discovery rule, an issue of fact exists as to when he discovered his causes of action and his complaint cannot be dismissed. The court agrees."

 The discovery rule under Janvey's fraudulent transfer claim gives plaintiffs a year to sue after the claim "could reasonably have been discovered by the claimant."

 "Application of the discovery rule is generally a fact-intensive issue inappropriate for resolution in a motion to dismiss," Godbey wrote. "Even once a plaintiff has been exposed to information that gives rise to a duty to inquire, whether the plaintiff has been diligent in making that inquiry is ultimately a question of fact" to be determined at trial.

 Godbey was not persuaded by the foundation's argument that Janvey failed to plead "diligence at all" in discovering the transfers.

 "This argument fails because, as discussed, the Receiver does allege diligence in discovering these transfers by claiming his team spent hours pouring over obscure financial records in order to identify actionable transfers," the order states. "Defendants take issue with the fact that the Receiver has not specifically contended that these particular transfers were concealed or difficult to discover. But, that would require too much of the complaint at the motion to dismiss stage."

 Godbey found that in a light most favorable for Janvey, it is "perfectly reasonable" to conclude that the "generally complex and obfuscated nature of the Stanford financial records made these particular transfers difficult to discover."

 The foundation did not immediately respond to a request for comment Thursday.

 Janvey has aggressively tried to recover funds originating from the Ponzi scheme, filing approximately 50 lawsuits against recipients since his appointment, according to the Courthouse News database.

 His targets have included the Miami Heat basketball team, Texas A&M University, the University of Miami, the PGA Tour and the ATP Tour, among others.

Read More here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum

Friday, 10 October 2014

Stanford Promises to Prove his Innocence and Repay Victims

To the Stanford International Bank depositors, and clients of the global Stanford Financial Group 

 As this is the first statement from me since the February 17, 2009 destruction of the global Stanford companies, and my imprisonment for allegedly operating a fraud that has been referred to as a "Ponzi scheme", I want to be direct, clear and emphatic. The actions taken by the U.S. government against me and my companies and that resulted in such harm to so many of you, was baseless, opportunistically contrived and, most importantly, unlawful. To many of you, and especially those of you who believe in and trust the accuracy and veracity of the American media machine, for now I will simply advise you of the series of legal actions taken by me in recent months and ask that you look at them on line, read them carefully and then follow their progress through the American legal system. In the coming days and weeks, as these legal initiatives make their way through the courts I will be posting a daily message on this site to keep informed those of you who have been harmed. 

Meanwhile, I want all of you to know, the many of you around the world who entrusted me and my companies with your investment monies, that it is my intent, and in fact my mission in this life, to restore my good reputation as an honest man, and to personally repay each and every one of you... in full ...each and every dollar that was so wrongfully taken from you by the Securities and Exchange Commission. The manner in which I intend to achieve this will be made clear in the coming weeks. 

Thank you,

 R. Allen Stanford

Read More here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum

Wednesday, 8 October 2014

Investor frustration peaking over stockbroker insurance

"The more you learn about what's going on down [on Wall Street], the more you learn is that it's not a safe place to invest," said Boston University economist Lawrence Kaltikoff.

You get blindsided in a wreck, and you expect your insurance company to pay.

 Your bank goes belly up, and you expect the Federal Deposit Insurance Corporation to reimburse your losses up to $250,000.

Your stock broker fails, and you expect the Securities Investor Protection Corporation to be good for your losses up to $500,000.

 But five years after Allen Stanford's $7 billion fraud on his investors, SIPC has paid them nothing.

 "I call Wall Street 'Fraud Street' these days," said Boston University economist Lawrence Kaltikoff. "Because the more you learn about what's going on down there, the more you learn is that it's not a safe place to invest."

 Not safe, he said, because the SIPC — which is supposed to protect investors when brokerages fail — has done nothing to protect the victims of Allen Stanford.

 "If SIPC wasn't behind Stanford, he never would have been able to run a business as he did," said Mary Oliver.

 She and scores of others went to Stanford's office in The Crescent office building in Dallas and invested their 401k money back in 2008. The seal of the Securities Investor Protection Corporation was on her broker's business card, and on the office door.

 The market was nervous, and SIPC insurance was a prime inducement to place her money with Stanford.

 Five years later, the SIPC claims all those Stanford losses aren't its problem. In fact, the SIPC says investors who lose money in some brokerage failures could actually owe money to the SIPC.

 In addition, this summer a federal appeals court upheld a ruling that what Allen Stanford sold investors weren't Wall Street securities, but certificates of deposit. Therefore, the SIPC should not be on the hook for the investor losses.

 It was all in the small print, the SIPC argued.

 "The Allen Stanford victims were supposed to read somewhere in 30 pages of documents when they signed up that their investments were [certificates of deposit], and not covered by SIPC," Kaltikoff said. "I think [the] SIPC should be ashamed of themselves. I would be embarrassed to be doing what they're doing.

 "I couldn't sleep at night to do that to people who've already been victimized," he added.

 Mary Oliver joined the Stanford Victims Coalition, which went to Washington to try to change the law. Their goal: To make SIPC more responsive to fraud, and to get some of their money back. 

House Bill 3482, which would do that, has been knocking around Congress for a year. It's been held up in the House Financial Services Committee, chaired by Rep. Jeb Hensarling of Dallas.

 Hensarling is a big recipient of campaign donations from the brokerage industry, which funds SIPC insurance through premiums. Those premiums could potentially go up if the SIPC were reformed.

 In the 2013-14 election cycle, Hensarling received $41,000 from two Wall Street brokerages alone. 

We asked him for an interview to discuss House Bill 3482. He was "unavailable."

 In a written statement, Hensarling said he sympathizes with the Stanford victims, but "concerns regarding SIPC's actions [...] are best addressed by the courts."

 He blamed the Stanford debacle on regulatory failures by the Securities and Exchange Commission. 

"When Congress reconvenes early next year, I expect there will be a renewed debate about the purpose and scope of SIPC," Hensarling said in the statement.

 It's been five years since the Stanford fraud came to light. So far, investors have received one penny for every dollar they've invested.

 None of it came from the SIPC.

Read More here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum

Monday, 6 October 2014


R. Allen Stanford—the billionaire fraudster and cricket enthusiast—with some cricket players in 2008. Photo by Brian Smith/Corbis Outline

A former Securities and Exchange Commission official and his law firm sought millions of dollars in new legal business in 2006 from financier R. Allen Stanford—during the same period of time the law firm had agreed to defend Stanford before the SEC, despite warnings from the SEC’s ethics counsel that any such representation would be illegal.

 Stanford lavished lucrative legal business on former SEC enforcement officer Spencer C. Barasch and the Houston law firm of Andrews Kurth, where Barasch is a partner, to persuade them to defend him before the SEC. Initially, in 2005, Barasch and Andrews Kurth turned Stanford down when he asked them to represent him before the SEC, telling him that to do so would violate federal conflict-of-interest laws. In 2006, however, Barasch ignored the legal prohibition and agreed to do so anyway.
Confidential Andrews Kurth billing records show that in 2006, while Stanford was pressing Barasch and Andrews Kurth to defend him before the SEC, Stanford hired the law firm to represent him on seven other legal matters, adding an eighth in 2007. In addition, according to a former Andrews Kurth employee, Barasch told his fellow partners that they stood to earn as much as $2 million a year for defending Stanford before the SEC. Previously, Stanford had been only a relatively modest client for the law firm. Barasch and Andrews Kurth declined to comment for this story.

 As the former chief enforcement officer of the SEC’s Fort Worth regional office, Barasch had overseen the agency’s monitoring of Stanford’s bank and brokerages. Between 1998 and 2005, Barasch had personally quashed six separate investigations of Stanford, according to government records. Officials at the SEC finally approved its first formal investigation of Stanford exactly one day after Barasch left the agency; examiners whom Barasch had stymied for years acted knowing they might succeed once he was gone. In 2009, the SEC and Justice Department would charge Stanford with masterminding a $7 billion Ponzi scheme, the second-largest in American history.

 It was because of Barasch’s Stanford-related work at the SEC that Stanford wanted to hire Barasch so badly, according to interviews and records. Barasch had inside information on what had worked in the past to persuade his colleagues to shut down earlier investigations of Stanford. Barasch even boasted to one of Stanford’s top deputies about his access and influence with former colleagues he might be able to persuade once again, now from the outside, not to investigate the billionaire financier. Stanford was determined to do whatever he could to get Barasch “on board asap,” he wrote in an email to two of his deputies.

 The 2006 SEC investigation would go on to reveal that Stanford’s international banking empire was one built on a foundation of financial fraud, deception, and bribery. It would take more than a decade after SEC examiners first uncovered evidence that he was engaged in a Ponzi scheme for Stanford to face criminal charges brought by a federal grand jury and the SEC. Stanford would be convicted by a federal jury in June 2012 and sentenced to a 110-year term in federal prison.

 The new information in this story—that Stanford awarded Andrews Kurth with eight new legal representations while trying to persuade them to defend him before the SEC—provides the first explanation of why Barasch and Andrews Kurth would risk violating the law—and the consequences of doing so. A former employee of the firm told me that the prospect of lucrative legal work played a role in persuading some of the firm’s partners to ignore the law, and Andrews Kurth’s billing records, confidential emails, and other documents appear to partially confirm this.

Read the Full Article here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum

Sunday, 5 October 2014

Allen Stanford files 299-page appeal of his 110-year sentence

Allen Stanford was convicted in 2012 on 13 felony charges related to America’s second-largest Ponzi scheme ever.

WASHINGTON — Even tucked away inside a high-security federal prison in Central Florida, former Houston billionaire banker Allen Stanford is still thinking big — and flouting the rules.

Stanford filed a 299-page brief last month with the 5th U.S. Circuit Court of Appeals in New Orleans, making no fewer than 15 lengthy arguments about why he should be set free. He was convicted in 2012 on 13 felony charges related to America’s second-largest Ponzi scheme ever and sentenced to 110 years in prison.

Before being halted by a federal judge in Dallas in 2009, Stanford’s fraud had drawn in more victims than any other investment scheme in American history. There are more than 18,000 outstanding claims from defrauded investors and thousands more under review.

Investors had deposited about $5.5 billion with Stanford, and so far just $72 million has been repaid to investors.

Kevin Sadler, the attorney for Ralph Janvey, the Dallas-based court-appointed receiver, said that nearly 1,400 verified claims totaling $455 million have been filed by investor groups with at least one victim living in Texas. There are 111 claims worth nearly $51 million with ties to Dallas residents.

Stanford’s verbose appeal is his best and probably only chance to die a free man. The court has given him until Monday to file the appeal again, at about half its current length.

Since he fired his court-appointed attorney, Stanford is writing his own appeal. In it, he divides his chief arguments into two broad attacks — that the U.S. didn’t have jurisdiction over his offshore business and that his trial in Houston was bungled.

The charges against him were improper, he writes, since his bank was in Antigua, not the United States, and offered clients certificates of deposit, not “securities” as defined by the U.S. statutes.

“Simply put, Stanford International Bank was regulated by — and only by — Financial Services Regulatory Commission of Antigua and Barbuda,” Stanford writes.

That part of his appeal is based in part on Morrison vs. Australian National Bank, a 2009 Supreme Court decision that ruled that Americans defrauded by the Australian bank couldn’t sue under U.S. law, even though incidental parts of the bank’s operations were in America.

Key question
Yet the high court in the Morrison case held that a key question that determines whether an offshore bank fraud triggers U.S. securities laws is whether it marketed its products to Americans.

“They are going to look at the Houston-based company and determine whether there was enough links between it and the CDs sold by Stanford’s bank in Antigua,” said securities law professor Stavros Gadinis of the University of California at Berkeley.

William J. Carney, professor emeritus of corporate law at Emory University in Atlanta, agreed.

“The difference between the Australian case and Stanford’s is that the Australian company didn’t do business in the U.S. and didn’t offer its securities here,” he said.

Carney said Stanford’s other argument, that the CDs he sold aren’t properly “securities,” has a long history in securities litigation.

“The question of whether CDs are securities is really a closer call,” he said.

Stanford also argues in his appeal that he never got a fair trial, thanks to a series of factors all stemming from a savage beating he took from another inmate just five months after he was placed in a federal detention center.

“This assault resulted in a traumatic brain injury ... required extensive reconstructive surgery, and was followed by over-medication of psychotropic drugs,” Stanford writes, describing injuries that prosecutors say he later tried to milk to avoid trial. “All of which, combined, profoundly affected his ability to communicate with his attorneys and prepare his defense.”

Strongest grounds
The beating and all the problems it caused later are probably his strongest grounds for a new trial, said Ali Fazel, who along with his partner Richard Scardino defended Stanford during his seven-week trial.

Before Stanford was indicted in 2009, U.S. District Judge David Hittner ordered Stanford to prison rather than allowing him to post bond. In court records, Hittner said he considered Stanford — who had traveled to 30 nations and five continents in the previous four years — an exceptional flight risk.

In September of that year, Stanford was badly beaten in prison.

“While sitting in a chair, he was grabbed from behind and fell backwards, hitting the back of his head on the concrete floor resulting in a concussion and loss of consciousness,” his lawyers asserted in a court filing before the trial. Unconscious, he was beaten even more severely. His assailant then smashed Stanford’s face with a steel pole, the filing said.

In 2011, Hittner ruled that Stanford was unfit to stand trial and ordered him sent to a prison medical facility for a four-month treatment. And that delay in the trial grew.

When officials at the facility said Stanford needed another four months of care, Hittner reluctantly delayed the trial until January 2012.

The delays meant further suffering for the victims. Hundreds of millions of dollars remained frozen until the outcome of the trial, which kept getting pushed back.

After Stanford’s eight months of treatment were over, his lawyers asked for yet another postponement, citing testimony from a string of psychiatrists that Stanford was still not competent.

Federal prosecutors pounced. They alleged in court papers that despite his injuries, Stanford’s continued efforts to avoid trial were just one more fraud.

They said Stanford had conveniently claimed to have now forgotten “all his past life events … as well as details of his business and banking operations.”

A psychologist at the facility concluded he was malingering and reported that Stanford performed so poorly on a test he administered that “mentally retarded children do much better.”

Fazel said he and his partner recognized, even at the time, that the handling of the trial would be Stanford’s best grounds for an appeal.

“It’s really a shame that a trained and talented appellate attorney didn’t get their hands on the trial record,” Fazel said. “There were lots of issues preserved in the record that would give a trained appellate lawyer a lot of room to work.”

The victims
The delay cost virtually every single one of Stanford’s fraud victims. The only sizable trove of recovered assets — $300 million worth — had been frozen overseas. Under the law, even those funds could not be distributed to victims until Stanford was convicted and there was a finding of fraud by the court.

Most of that $300 million is still frozen, pending appeal.

"Unquestionably the delays at trial, and now with [Stanford] dragging out his appeal by shuffling through attorneys and filing these overlong briefs, have meant a delay of at least two years — and counting,” said Sadler, the attorney for the receiver.

Beyond the dollars, the human impact of the delay, and of the fraud itself, has been enormous.

Among the victims in Texas: a retired businesswoman who lost $1.3 million, money she was relying on to treat a rare genetic disease that would kill her without a kidney transplant; a retired cattle rancher who lost everything and found himself in and out of a hospital intensive-care unit repeatedly as doctors feared the stress was killing him; and a retired railway man and honored Vietnam veteran who feared that he had no money left to take care of a wife disabled with Parkinson’s.

Mary Oliver and her husband were living in Dallas in late 2007 when they began investing their retirement funds — about $1 million — with Stanford. Like most victims, they’ve recovered less than 1 percent of their losses.

“Allen Stanford ruined the lives of thousands of hard-working, tax-paying investors by stealing their life savings,” Oliver said. “He lied, cheated and stole from innocent victims. He deserves to be in jail for the rest of his life on earth.”

Stanford’s appeal is his best shot at avoiding that fate, but even as he prolongs his case, the thousands of people he defrauded have little prospect of ever being made whole.

Read More here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum

Friday, 3 October 2014

Appeal of Robert Allen Stanford - Sep. 10, 2014

Following part of the appeal of Stanford.


 I. Whether the Securities and Exchange Commission (SEC) had jurisdiction and regulatory authority over Stanford International Bank Limited (SIB), or its Certificates of Deposit (CDs). And whether, following the SEC's civil action, the Department of Justice's (DOJ) criminal Indictment was defective.

 II. Whether the simultaneous civil and criminal prosecutions (and sanctions imposed), based on the same underlying events, were violations of the DueProcess Clause of the Fifth and Eighth Amendments, and defendant Stanford's protection from Double Jeopardy.

 III.Whether the Trial Court violated defendant Stanford's Fourth Amendment protection from illegal searches and seizures.

 IV. Whether the District Court abused its discretion when it failed to hold a pre-trial Hearing to determine whether defendant Stanford had any "untainted" funds that could be used to pay for his defense.

 V. Whether the Trial Court abused its discretion by (a) disqualifying defendant Stanford's competent counsel of choice, and; (b) forcing ill-prepared appointed counsel to proceed to trial.

 VI. Whether the Trial Court violated defendant Stanford's Sixth Amendment right to a fair trial, by failing to provide appropriate responses to Jury Notes Two and Three.

 VII. Whether defendant Stanford was deprived of his Sixth Amendment right to a fair trial, because pre-trial publicity precluded the assembly of an impartial jury.

 VIII. Whether the Trial Court abused its discretion by first deeming defendant Stanford competent, and then failing to grant him adequate time to prepare an effective defense, assist his counsel, or prepare to testify on his own behalf; in violation of the Due Process Clause of the Fourteenth Amendment, as well as his Fifth and Sixth Amendment rights to a fair trial.

 IX. Whether the Trial Court abused its discretion by denying defendant Stanford adequate time to prepare an effective defense.

Read More here:

For a full and open debate on the Stanford receivership visit the Stanford International Victims Group - SIVG official Forum