Stanford investors, receiver file suit against two law firms

By Mike Tolson | November 15, 2012 | Updated: November 15, 2012 11:16pm

A group of investors victimized by R. Allen Stanford's $7 billion Ponzi scheme along with the court-appointed receiver tasked with obtaining Stanford's remaining assets filed a $1.8 billion lawsuit Thursday against two law firms which they claim share responsibility for the swindle.

Receiver Ralph Janvey along with several named investors filed the federal class-action lawsuit in Dallas that pointed a finger at Miami banking attorney Carlos Loumiet. Loumiet was not named as a defendant, but two law firms where he worked - Greenberg Traurig and Hunton & Williams - were alleged to have designed the "architecture" of the scheme and co-opted government officials in the Caribbean island nation of Antigua whose complicity was essential.

Offshore banking

Stanford Financial Group sold what it called certificates of deposit that provided higher rates of return than typical CDs available from American financial institutions.

The money flowed into an elaborate offshore banking enterprise that was more difficult for U.S. regulators to scrutinize. The scheme lasted for two decades before it collapsed amid a federal investigation in 2009.

Stanford himself lived on Antigua and enjoyed a lavish lifestyle unwittingly fueled by thousands of investors who believed their money was safe.

Also named as a defendant was Yolanda Suarez, a former Stanford employee characterized as Loumiet's onetime protege.

"As a partner at Greenberg Traurig and then Hunton & Williams, Carlos Loumiet helped design the basic architecture of the Ponzi scheme by helping Stanford establish and operate unlicensed foreign bank offices in the U.S. and essentially hijacking the sovereign island nation of Antigua through the use of political corruption, loans made with funds stolen from Stanford's investors, and even writing the laws that governed Stanford International Bank's operations," said plaintiff attorney Ed Snyder, who filed the complaint, in a prepared statement.

Denies impropriety

Loumiet denied any wrongdoing.

"I can say that I have never in my long career knowingly helped any client commit any wrongdoing," Loumiet said in a prepared statement. "I have never represented anyone that I knew was engaged in wrongdoing. And after years of investigations by the federal government and months of trials involving Allen Stanford and his codefendants, I have not been implicated in any wrongdoing."

Likewise, the two named law firms said they had no idea what was going on. Hunton & Williams called the suit "factually and legally baseless and an overreach by Stanford Financial Group's understandably frustrated investors."

The attorney for Greenberg Traurig, Jim Cowles, said the lawsuit is just one more in a series of legal actions intended to "pry open a deep pocket" in order to compensate victims.

"Greenberg Traurig is not responsible for the fraud committed by Stanford," Cowles said.

Janvey's suit, however, says Loumiet was not just a lawyer but a longtime Stanford confidante who was relied on to get the scheme up and running and keep it that way.

"In the final analysis Loumiet and Suarez succeeded for 21 years in enabling Stanford Financial to effectively operate free of governmental regulations and oversight and completely outside the law," the lawsuit states.

"Loumiet's and Suarez's fingerprints are all over the Stanford Ponzi scheme from beginning to end, and to tell the story of Loumiet's and Suarez's involvement with Stanford is to tell the story of the Stanford Financial Group itself."

Loumiet now works at a different law firm in Miami.

Suarez lives in Miami and could not be reached for comment.