For years federal law enforcers ignored warnings about R. Allen Stanford's $7 billion fraud, but don't expect government officials to suffer any penalty. Instead, plaintiffs lawyers are seeking to use Stanford's crimes as a pretext to launch class-action lawsuits against other people and businesses.
Now the Supreme Court will decide whether to let them. The question at oral argument this week in Chadbourne & Parke LLP v. Troice was whether state class-action lawsuits filed against various vendors to Stanford's operation should be allowed to proceed.
Last year Stanford was convicted and sentenced to 110 years in prison for defrauding thousands of investors around the world. Because the enforcement division of the Securities and Exchange Commission spent more than a decade ignoring recommendations to investigate from both inside and outside the SEC, victims will likely recover very little of the billions they sent to Stanford.
So plaintiffs lawyers want to take it out on others who did business with Stanford, even if they didn't have anything to do with his bogus offering of certificates of deposit from his bank in Antigua. Stanford told investors that the money backing their CDs was invested in safe, liquid securities that trade in U.S. public markets, when in fact investors were funding a Ponzi scheme.
The trial lawyers want to sue under state law because previous Supreme Court decisions—especially Central Bank of Denver v. First Interstate Bank of Denver and Stoneridge v. Scientific Atlanta—make it difficult under federal law to sue companies that merely did business with fraudsters, unless these vendors directly participated in misleading investors.
Moreover, a 1998 reform prevents securities class-action cases from being brought under state law. The Securities Litigation Uniform Standards Act says that such cases must be filed under federal law if "the defendant used or employed any manipulative or deceptive device or contrivance in connection with the purchase or sale of a covered security."
Covered securities include stocks and bonds issued by firms that trade on U.S. exchanges. At Monday's oral argument, Justice Antonin Scalia noted that Stanford didn't fulfill his promise to put investors' money in these securities, and therefore such a case "can't be in connection with a purchase or sale that has never occurred."
As usual, Justice Scalia is doing a public service by focusing on the text of the law the court is asked to interpret. But a fraudulent claim of buying securities sure sounds to us like a "deceptive device" that's "in connection with" a purchase of securities. Otherwise, could Bernie Madoff argue that he didn't commit securities fraud because he pocketed the cash from victims instead of investing it?
The Justices also wrestled with the significance of Stanford's various deceptions. The U.S. Court of Appeals for the Fifth Circuit had overturned a district court and ruled in favor of the plaintiffs in part because Stanford made other significant misrepresentations unrelated to securities.
But on Monday Paul Clement, attorney for the defendants, rightly noted that without the promise of these liquid assets, "nobody's going to give their money to a bank in Antigua. The reason you give your money to a bank in Antigua is because you think it's backed by something more than a piece of paper, and the something more was purchases of covered securities on the market."
Even if the Supreme Court rules against them, Stanford's victims can still pursue justice via federal class-action suits, or via individual suits in both state and federal court. But overriding federal law to allow suits against defendants who may have done nothing wrong is anything but just.
Read More: http://sivg.org.ag/topic203.html
For a full and open debate on the Stanford Receivership visit the Stanford International Victims Group – SIVG official forum http://sivg.org.ag/
Showing posts with label trial. Show all posts
Showing posts with label trial. Show all posts
Saturday, 12 October 2013
Friday, 16 November 2012
Statement from Kachroo Legal Services
We are preparing another update specifically addressing the status of our lawsuit against the government and all the work we have conducted after the Court denied the government’s motion to dismiss. However, to clarify, the Court’s order was an initial ruling that allowed our lawsuit to go forward into the next stage, which is where we attempt to prove our claims against the government. It was a groundbreaking ruling because all other lawsuits were dismissed immediately upon filing and were not allowed to go forward. We are now in the next stage of the litigation where we seek documents from the other side in order to prove our claims. Our update will address the status of this stage of the litigation. If you have any other questions, please feel free to contact me directly. I am happy to speak with you via email or we can discuss over the phone. You can reach me (212) 372-8939.
The Court’s order was an initial ruling that allowed our lawsuit to go forward into the next stage, which is where we attempt to prove our claims against the government. It was a groundbreaking ruling because all other lawsuits were dismissed immediately upon filing and were not allowed to go forward. We are now in the next stage of the litigation where we seek documents from the other side in order to prove our claims.
And how long does that procedure may take
The deadline to complete this stage of the litigation (called “discovery”) is March 1, 2013. There are a few other stages of the litigation after discovery, during which each side will argue that a judgment should be entered in their favor and the case should not proceed to a trial. If the court disagrees with both sides, then it will go to a full trial. The trial date is now set for October 21, 2013.
Wednesday, 17 October 2012
Stanford Accountants Face Final Criminal Trial Over Ponzi Scheme
By Laurel Brubaker Calkins and Andrew Harris on October 17, 2012
Two accountants accused of helping R. Allen Stanford swindle investors in a $7 billion Ponzi scheme are set to begin the last criminal trial stemming from the plot with opening statements in federal court in Houston.
Stanford Financial Group Co. Chief Accounting Officer Gilbert Lopez, 70, and Global Controller Mark Kuhrt, 40, face 10 counts of wire fraud and one count of conspiracy to commit wire fraud, which could send them to prison for more than 20 years if convicted by a jury. The men pleaded not guilty when they were indicted with the Texas financier in June 2009.
“Kuhrt and Lopez fabricated the financial statements that enabled Stanford to lie to investors about the circumstances surrounding their investments,” Robert Khuzami, enforcement director for the U.S. Securities and Exchange Commission, said in a statement the day the men were indicted.
Stanford, 62, was convicted in March of misappropriating more than $1.7 billion from investors who bought bogus certificates of deposit from Antigua-based Stanford International Bank Ltd. The former Texas billionaire is now serving a 110-year sentence in federal prison in Florida. He is appealing his verdict and sentence.
Stanford told investors their money was invested in conservative liquid assets. Evidence at his jury trial showed he was actually siphoning cash to fund risky private equity ventures, speculative real estate developments, cricket tournaments and a lavish personal lifestyle that included a fleet of private jets, yachts and multiple mansions.
Lopez, Kuhrt and James M. Davis, who was Stanford’s chief financial officer, discussed in these messages how to repeatedly flip a Caribbean resort property among Stanford entities so that its value could be inflated from $63.5 million to $3.2 billion in a matter of months, according to the indictment. The inflated value was intended to plug the hole in the books caused by Stanford’s personal loans and bad investments, prosecutors have said.
Lopez and Kuhrt also helped represent to investors that Stanford made a $741 million capital contribution to bolster the bank’s balance sheet in late 2008, when “Stanford did not make such capital contributions,” prosecutors have said.
Lawyers for Lopez and Kuhrt said during a 2011 court proceeding over legal-defense insurance coverage that the accountants were only following orders from Stanford and Davis and never intended to break any laws.
Davis pleaded guilty to his role in the fraud scheme in 2009, testified against Stanford at trial and is awaiting sentencing. Laura Pendergest Holt, Stanford’s investment chief, pleaded guilty in June to obstructing a federal investigation into Stanford’s companies and was sentenced to three years in prison.
As of May 31, more than 20,000 Stanford CD investors had received nothing from about $220 million that court-appointed receiver Ralph Janvey has recovered from the sale of Stanford’s corporate and personal assets. About $108 million of that recovery has gone to cover the U.S. receivership’s expenses and windup costs on Stanford’s sprawling business empire.
An additional $335 million in Stanford assets have been identified in banks in the U.K., Switzerland and Canada. Janvey is fighting for control of those assets with a rival Antiguan-appointed receiver, who has spent about $20 million pursuing Stanford assets on behalf of defrauded investors.
The case is U.S. v Lopez, 4:09-cr-00342, U.S. District Court, Southern District of Texas (Houston).
Two accountants accused of helping R. Allen Stanford swindle investors in a $7 billion Ponzi scheme are set to begin the last criminal trial stemming from the plot with opening statements in federal court in Houston.
Stanford Financial Group Co. Chief Accounting Officer Gilbert Lopez, 70, and Global Controller Mark Kuhrt, 40, face 10 counts of wire fraud and one count of conspiracy to commit wire fraud, which could send them to prison for more than 20 years if convicted by a jury. The men pleaded not guilty when they were indicted with the Texas financier in June 2009.
“Kuhrt and Lopez fabricated the financial statements that enabled Stanford to lie to investors about the circumstances surrounding their investments,” Robert Khuzami, enforcement director for the U.S. Securities and Exchange Commission, said in a statement the day the men were indicted.
Stanford, 62, was convicted in March of misappropriating more than $1.7 billion from investors who bought bogus certificates of deposit from Antigua-based Stanford International Bank Ltd. The former Texas billionaire is now serving a 110-year sentence in federal prison in Florida. He is appealing his verdict and sentence.
Stanford told investors their money was invested in conservative liquid assets. Evidence at his jury trial showed he was actually siphoning cash to fund risky private equity ventures, speculative real estate developments, cricket tournaments and a lavish personal lifestyle that included a fleet of private jets, yachts and multiple mansions.
Primary Evidence
The primary evidence against Lopez and Kuhrt are e-mails in which they discussed Stanford’s unreported loans and how to value certain assets to disguise that debt in the months before U.S. securities regulators seized Stanford’s businesses in February 2009.Lopez, Kuhrt and James M. Davis, who was Stanford’s chief financial officer, discussed in these messages how to repeatedly flip a Caribbean resort property among Stanford entities so that its value could be inflated from $63.5 million to $3.2 billion in a matter of months, according to the indictment. The inflated value was intended to plug the hole in the books caused by Stanford’s personal loans and bad investments, prosecutors have said.
Lopez and Kuhrt also helped represent to investors that Stanford made a $741 million capital contribution to bolster the bank’s balance sheet in late 2008, when “Stanford did not make such capital contributions,” prosecutors have said.
Lawyers for Lopez and Kuhrt said during a 2011 court proceeding over legal-defense insurance coverage that the accountants were only following orders from Stanford and Davis and never intended to break any laws.
Draft Form
The accountants’ lawyers have said prosecutors are misconstruing documents that were in draft form at the time regulators seized the company. They claim that Stanford and his accountants were in the process of consolidating the private enterprises Stanford funded with investor loans onto the bank’s balance sheet, and that they were prevented from completing the rollup by the government shutdown.Davis pleaded guilty to his role in the fraud scheme in 2009, testified against Stanford at trial and is awaiting sentencing. Laura Pendergest Holt, Stanford’s investment chief, pleaded guilty in June to obstructing a federal investigation into Stanford’s companies and was sentenced to three years in prison.
As of May 31, more than 20,000 Stanford CD investors had received nothing from about $220 million that court-appointed receiver Ralph Janvey has recovered from the sale of Stanford’s corporate and personal assets. About $108 million of that recovery has gone to cover the U.S. receivership’s expenses and windup costs on Stanford’s sprawling business empire.
An additional $335 million in Stanford assets have been identified in banks in the U.K., Switzerland and Canada. Janvey is fighting for control of those assets with a rival Antiguan-appointed receiver, who has spent about $20 million pursuing Stanford assets on behalf of defrauded investors.
The case is U.S. v Lopez, 4:09-cr-00342, U.S. District Court, Southern District of Texas (Houston).
Thursday, 13 September 2012
Pendergest-Holt sentence due Thursday for Stanford crime
by PATSY R. BRUMFIELD/Daily Journal
HOUSTON, Texas – Baldwyn native Laura Pendergest-Holt is set for sentencing Thursday for her attempts to obstruct the investigation of a Ponzi scheme at Stanford International Bank Ltd. Holt was chief investment officer at Stanford Financial Group based out of Memphis, with offices in Tupelo, when the entire Stanford financial empire came crashing down in 2009 under the weight of a federal investigation. Her boss, R. Allen Stanford, was convicted last March of masterminding the scheme, which cost worldwide investors $7.2 billion. He is serving a 110-year prison sentence. In a deal with the government, Holt pleaded guilty June 21 to one count and faces up to five years in prison. Her deal recommends three years. She’ll appear before District Judge David Hittner for a 9:45 a.m. hearing in Houston, where Stanford built his empire. Co-defendants Mark Kuhrt and Gilbert Lopez, former Stanford executives, are set for trial there starting Sept. 28. Read more: djournal.com - Update Pendergest Holt sentence due Thursday for Stanford crime
Friday, 7 September 2012
Lawsuit against U.S. over Stanford Ponzi scheme can go ahead
Source:Joseph Ax (Reuters)
(Reuters) - A lawsuit claiming U.S. securities regulators were negligent in failing to respond earlier to Allen Stanford's $7 billion Ponzi scheme can go forward for now, a federal judge ruled in Florida on Friday.
U.S. District Judge Robert Scola rejected the U.S. government's motion to dismiss the case, according to court documents. The government claimed the court did not have jurisdiction over the U.S. Securities and Exchange Commission's handling of the Stanford case.
The purported class action complaint, filed by two investors who say they lost a combined $1.65 million when the scheme collapsed, claims the SEC knew as early as 1997 that Stanford was likely operating a Ponzi scheme but took no action against him until 2009. The SEC had a duty to notify the Securities Investor Protection Corp (SIPC) of Stanford's fraud, the lawsuit asserts.
The SIPC, funded by the brokerage industry, handles investors' claims when brokers fail and has overseen liquidation proceedings for Bernard Madoff's Ponzi scheme and the collapse of MF Global.
In his ruling, Scola found that the SEC was required to act if it concluded that Stanford was running a Ponzi scheme.
"When the Securities and Exchange Commission believes that a broker or dealer is in or approaching financial difficulty then it must report that broker/dealer to the Securities Investor Protection Corporation," he wrote.
Scola did, however, dismiss the lawsuit's second claim, which faulted the SEC for not considering whether to deny Stanford's company's annual registration as an investment advisor. The judge agreed with the government's argument that such decisions are entirely within the SEC's discretion.
The government's argument that the SEC did not know Stanford was running a Ponzi scheme will be addressed if and when it moves for summary judgment, the judge said.
A similar $18.7 million lawsuit against the U.S. was tossed by a Texas federal judge last year for lack of jurisdiction.
In a March 2010 report, the SEC's inspector general found the SEC was aware since 1997 that Stanford was likely running a Ponzi scheme and that numerous agencies, including the Federal Bureau of Investigation, the Justice Department and the Secret Service, all probed Stanford's operations at one time or another.
An SEC spokeswoman declined to comment on Friday's ruling.
"This is a historic ruling showing that the SEC can finally be held accountable for not notifying SIPC," said Gaytri Kachroo, a lawyer for the plaintiffs.
Stanford was sentenced in June to 110 years in prison for bilking investors with fraudulent CDs issued by Stanford International Bank, his bank in Antigua.
The plaintiffs are seeking unspecified damages and certification of the class action.
The case is Zelaya et al. v. United States, U.S. District Court for the Southern District of Florida, No. 11-62644.
(Reporting by Joseph Ax; editing by Carol Bishopric)
(Reuters) - A lawsuit claiming U.S. securities regulators were negligent in failing to respond earlier to Allen Stanford's $7 billion Ponzi scheme can go forward for now, a federal judge ruled in Florida on Friday.
U.S. District Judge Robert Scola rejected the U.S. government's motion to dismiss the case, according to court documents. The government claimed the court did not have jurisdiction over the U.S. Securities and Exchange Commission's handling of the Stanford case.
The purported class action complaint, filed by two investors who say they lost a combined $1.65 million when the scheme collapsed, claims the SEC knew as early as 1997 that Stanford was likely operating a Ponzi scheme but took no action against him until 2009. The SEC had a duty to notify the Securities Investor Protection Corp (SIPC) of Stanford's fraud, the lawsuit asserts.
The SIPC, funded by the brokerage industry, handles investors' claims when brokers fail and has overseen liquidation proceedings for Bernard Madoff's Ponzi scheme and the collapse of MF Global.
In his ruling, Scola found that the SEC was required to act if it concluded that Stanford was running a Ponzi scheme.
"When the Securities and Exchange Commission believes that a broker or dealer is in or approaching financial difficulty then it must report that broker/dealer to the Securities Investor Protection Corporation," he wrote.
Scola did, however, dismiss the lawsuit's second claim, which faulted the SEC for not considering whether to deny Stanford's company's annual registration as an investment advisor. The judge agreed with the government's argument that such decisions are entirely within the SEC's discretion.
The government's argument that the SEC did not know Stanford was running a Ponzi scheme will be addressed if and when it moves for summary judgment, the judge said.
A similar $18.7 million lawsuit against the U.S. was tossed by a Texas federal judge last year for lack of jurisdiction.
In a March 2010 report, the SEC's inspector general found the SEC was aware since 1997 that Stanford was likely running a Ponzi scheme and that numerous agencies, including the Federal Bureau of Investigation, the Justice Department and the Secret Service, all probed Stanford's operations at one time or another.
An SEC spokeswoman declined to comment on Friday's ruling.
"This is a historic ruling showing that the SEC can finally be held accountable for not notifying SIPC," said Gaytri Kachroo, a lawyer for the plaintiffs.
Stanford was sentenced in June to 110 years in prison for bilking investors with fraudulent CDs issued by Stanford International Bank, his bank in Antigua.
The plaintiffs are seeking unspecified damages and certification of the class action.
The case is Zelaya et al. v. United States, U.S. District Court for the Southern District of Florida, No. 11-62644.
(Reporting by Joseph Ax; editing by Carol Bishopric)
KLS Beats the SEC Motion to Dismiss!!!!
FANTATIC NEWS FOR ALL VICTIMS GAYTRI KACHROO HAS BEAT THE SEC MOTION TO DISMISS HER CASE....WE ARE TAKING THE SEC TO COURT!
Zelaya Order MTD
Zelaya Order MTD
Friday, 22 June 2012
A former top lieutenant to imprisoned financier R. Allen Stanford pleaded guilty Thursday in Houston to obstructing the Securities and Exchange Commission inquiry that led to the downfall of his global empire. Laura Pendergest-Holt, 38, spoke in a soft, tremulous voice as she answered a federal judge’s pointed questions about her role in the multibillion-dollar fraud. She was chief investment officer of Stanford Financial Group, an international financial services company based in Houston. “I knew I was delaying the SEC,” she told U.S. District Judge David Hittner, providing the only real drama in the half-hour court hearing. hlt stanf In return for her guilty plea, and her agreement to forgo any appeal, the government said it would drop the remaining 20 criminal charges against Pendergest-Holt. Prosecutor Jason Varnado recommended a three-year prison sentence. The obstruction charge carries a maximum sentence of five years in prison and a $250,000 fine. Hittner accepted the guilty plea and announced a Sept. 13 sentencing hearing. In the meantime, federal probation officials will prepare a pre-sentence report for the judge. Pendergest-Holt, attired in a black pantsuit, white jacket and flats, was allowed to remain free on bond. She left the courtroom in the company of her husband and attorney.
Ex-Stanford executive pleads guilty to obstruction
Associated Press
HOUSTON – Disgraced Texas financier R. Allen Stanford's former chief investment officer for his now defunct financial empire pleaded guilty Thursday for her role in helping the once jet-setting businessman bilk investors out of more than $7 billion.
A tearful Laura Pendergest-Holt changed her original not guilty plea a week after Stanford was sentenced to 110 years in prison following his conviction on fraud-related charges for orchestrating one of the biggest Ponzi schemes in U.S. history.
As part of an agreement with federal prosecutors, Pendergest-Holt, 38, pleaded guilty to one count of obstruction of a U.S. Securities and Exchange Commission proceeding in exchange for a three-year prison sentence. The obstruction count carries a maximum prison term of five years. As part of the plea deal, prosecutors will drop 20 other counts, including conspiracy, wire and mail fraud.
U.S. District Judge David Hittner said he will consider the deal, including the sentencing recommendation, when he sentences her on Sept. 13.
Pendergest-Holt, a native of Baldwyn, Miss., her attorney, Chris Flood, and prosecutors all declined to comment after the hearing.
Prosecutors said Stanford, 62, used the money from investors who bought certificates of deposit, or CDs, from his bank on the Caribbean island nation of Antigua to fund a string of failed businesses, bribe regulators and pay for a lavish lifestyle that included yachts, a fleet of private jets and sponsorship of cricket tournaments. The one-time billionaire was convicted in March on 13 of 14 fraud-related counts
Prosecutors said Stanford lied to investors from more than 100 countries, telling them their funds were being safely invested in stocks, bonds and other securities.
During Thursday's court hearing, Pendergest-Holt admitted she gave the impression to investors and employees that she knew what assets made up the bank's investment portfolio, which was divided into three tiers. According to authorities, Pendergest-Holt didn't know most of the bank's assets were tied up in Tier 3, which was made up of real estate purchases whose value had been overinflated by billions and by up to $2 billion in personal loans to Stanford.
"Her management of (the bank's) investments was confined to Tier 2, which made up only about 12 percent of the bank's assets," said prosecutor Jason Varnado.
When the SEC began investigating, officials say Stanford, Pendergest-Holt and other company executives conspired to hide the bank's true financial health and provide misleading testimony to the federal agency in 2009.
During the court hearing, Hittner prodded Pendergest-Holt to offer details of her actions, asking her to "tell me what you did."
Pendergest-Holt, who was the first person indicted in the case, told Hittner she was not completely truthful with the SEC when she testified before the agency in Fort Worth, Texas, in February 2009, a week before authorities shut down Stanford's companies.
"I knew I was delaying" the SEC's investigation, she said.
Varnado told Hittner that at least $350,000 that had been held by Pendergest-Holt was frozen by a U.S. receiver who took over Stanford's companies and those funds will be given to victims.
During Stanford's trial, the financier's defense attorneys had tried to use an affair Pendergest-Holt had with James M. Davis, the former chief financial officer for Stanford's companies and the prosecution's star witness, to discredit Davis, who has pleaded guilty and faces up to 30 years in prison.
Wednesday, 20 June 2012
URGENT! Submit your Comments to Prosecutors on Pendergest-Holt proposed Lenient Sentence
Below are the court papers for the Plea Bargain of Prendergast Holt. The court is asking for our comments about this. PLEASE, we don't have much time but it is imperative that we send emails expressing our disgust at this light sentencing. REMEMBER....we have already served 3 1/2 years and we still have many years to go before we can see any sign of freedom from our forced poverty. WE need to make clear to Judge Godbey that it is grossly unfair for PH to walk away with such a lenient sentence and we also need to request that she forfeit all her property, and money...after all it was the victims who paid for her lifestyle!!
PLEASE NOTE THIS HAS TO DONE TODAY!!!!!!!!!
On June 18, 2012, the United States District Court for the Southern District of Texas issued a Notice of Setting indicating that on June 21, 2012, at 11:00 a.m., the defendant Laura Pendergest-Holt is expected to plead guilty to resolve the pending charges against her in the above-referenced case. At that time, Holt will enter into a plea agreement with the government pursuant to Rule 11(c)(1)(C) of the Federal Rules of Criminal Procedure. Under that rule, the government agrees that a specific sentence or sentencing range is the appropriate disposition of the case, or that a particular provision of the Sentencing Guidelines, or policy statement, or sentencing factor does or does not apply. Such a recommendation or request binds only the court once the court accepts the plea agreement at sentencing. To resolve the pending charges against her, the defendant Laura Pendergest-Holt is expected to plead guilty to Count Twenty of the Indictment, charging Obstruction of Justice, and the government has agreed that a sentence of 36 months of imprisonment, followed by a three-year term of supervised release, is the appropriate disposition of the case. She will also be subject to a fine, to be determined by the Court.
In light of this recent development, and in order for us to learn if you have any views in regard to any such plea, please submit your views to the prosecutors handling this investigation, by providing comments to Pam Washington at 1-888-549-3945 or via email at victimassistance.fraud@usdoj.gov, no later than 5:00 p.m. EST on June 20, 2012. Also, in accordance with the Order Authorizing Compliance with the Justice for All Act issued in this case on June 16, 2010, any victim wishing to appear and to be heard by the Court at the plea hearing must notify Pam Washington at victimassistance.fraud@usdoj.gov by the same June 20 deadline. However, as the defendant Laura Pendergest-Holt is pleading guilty under Rule 11 (c)(1)(C), and her plea agreement will not be accepted until the time of sentencing, the government will continue to accept comments concerning the plea after the June 20 deadline and up until 30 days before sentencing. The Court will later rule on whether, and the manner in which, victims may be heard at the sentencing proceeding. Lastly, because this plea agreement was reached recently, and because the precise language of the plea agreement is still being finalized, the executed plea agreement will be filed publicly following the June 21, 2012 hearing.
Kate
Tuesday, 19 June 2012
Stanford Officer Pendergest Holt Said to Have Plea Deal
By Laurel Brubaker Calkins and Andrew Harris
Laura Pendergest Holt, the former chief investment officer for R. Allen Stanford, has agreed to plead guilty and serve three years in prison for her role in a $7 billion fraud, three people familiar with the matter said.
Pendergest Holt, 38, will plead guilty to a single obstruction charge, said one of the people, all of whom asked not to be identified because the plea agreement isn’t public.
She faces a September trial on charges related to those that resulted in Stanford being sentenced on June 14 to 110 years in prison. Prosecutors had requested a maximum sentence of 230 years against Stanford, based on investors’ losses on bogus certificates of deposit sold by Antigua-based Stanford International Bank Ltd.
Pendergest Holt has denied wrongdoing. Dan Cogdell, her lead attorney, didn’t return phone and e-mail messages yesterday seeking comment on a plea agreement. Pendergest Holt is scheduled for re-arraignment on July 21 in federal court in Houston, according to court records.
Pendergest Holt had told Stanford Financial Group Co. investors and the firm’s financial advisers that she oversaw a stable of international money managers who were responsible for the bulk of the bank’s assets, according to court papers. She may have had authority over as little as 20 percent of the bank’s assets, according to testimony during Stanford’s trial.
Alisa Finelli, a Justice Department spokeswoman, declined to comment on the reported plea agreement.
Stanford, 62, was convicted in March by a federal court jury in Houston of leading a massive fraud in which later investors’ funds were used to pay above-market returns to earlier investors. He was accused of secretly borrowing more than $2 billion in depositors’ funds to finance a lavish lifestyle and several money-losing businesses.
Stanford is appealing his March 6 conviction and his sentence.
Joan Stack, former global human resources manager at Stanford Financial Group, testified during Stanford’s trial that Davis and Pendergest Holt routinely hired unqualified relatives and fellow church members to staff most positions in the Memphis, Tennessee, research division that oversaw the bank’s multibillion-dollar investment portfolio.
“They were family members who had no experience in doing what we’d hired them to do,” Stack said.
Holt invested about $2 million of the bank’s portfolio in a hedge fund run by her husband, a former personal trainer, according to testimony.
The case is U.S. v. Stanford, 4:09-cr-0342, U.S. District Court, Southern District of Texas (Houston).
Laura Pendergest Holt, the former chief investment officer for R. Allen Stanford, has agreed to plead guilty and serve three years in prison for her role in a $7 billion fraud, three people familiar with the matter said.
Pendergest Holt, 38, will plead guilty to a single obstruction charge, said one of the people, all of whom asked not to be identified because the plea agreement isn’t public.
She faces a September trial on charges related to those that resulted in Stanford being sentenced on June 14 to 110 years in prison. Prosecutors had requested a maximum sentence of 230 years against Stanford, based on investors’ losses on bogus certificates of deposit sold by Antigua-based Stanford International Bank Ltd.
Pendergest Holt has denied wrongdoing. Dan Cogdell, her lead attorney, didn’t return phone and e-mail messages yesterday seeking comment on a plea agreement. Pendergest Holt is scheduled for re-arraignment on July 21 in federal court in Houston, according to court records.
Pendergest Holt had told Stanford Financial Group Co. investors and the firm’s financial advisers that she oversaw a stable of international money managers who were responsible for the bulk of the bank’s assets, according to court papers. She may have had authority over as little as 20 percent of the bank’s assets, according to testimony during Stanford’s trial.
Three-Year Affair
Prosecutors charged her in June 2009 with conspiring to mislead investors in conjunction with Stanford and Chief Financial Officer James M. Davis, her boss and former lover. During Stanford’s trial, Davis told jurors he had a three-year affair with Pendergest Holt that ended in 2003, and that Stanford approved of the romance between his two top deputies.Alisa Finelli, a Justice Department spokeswoman, declined to comment on the reported plea agreement.
Stanford, 62, was convicted in March by a federal court jury in Houston of leading a massive fraud in which later investors’ funds were used to pay above-market returns to earlier investors. He was accused of secretly borrowing more than $2 billion in depositors’ funds to finance a lavish lifestyle and several money-losing businesses.
Stanford is appealing his March 6 conviction and his sentence.
Joan Stack, former global human resources manager at Stanford Financial Group, testified during Stanford’s trial that Davis and Pendergest Holt routinely hired unqualified relatives and fellow church members to staff most positions in the Memphis, Tennessee, research division that oversaw the bank’s multibillion-dollar investment portfolio.
“They were family members who had no experience in doing what we’d hired them to do,” Stack said.
Holt invested about $2 million of the bank’s portfolio in a hedge fund run by her husband, a former personal trainer, according to testimony.
The case is U.S. v. Stanford, 4:09-cr-0342, U.S. District Court, Southern District of Texas (Houston).
Thursday, 14 June 2012
Allen Stanford Sentenced to 110 Years in Prison
By Walter Pavlo,
Dressed in green prison fatigues, R. Allen Stanford entered a federal courthouse in Houston today to hear U.S. District Judge David Hitner pronounce his prison sentence. The decision: 110 years.
Prosecutors had asked that the one-time billionaire financier get 230 years in prison. (note: Bernard Madoff is serving 150 years). The prosecutor told Judge Hitner, “230 years will not get anyone their money back but on sleepless nights they will know that he got the maximum.” I think 110 years will give them just as much comfort.
During the proceeding, Stanford’s attorney, Ali Fazel, objected to the use of the term “Ponzi scheme,” but Hittner said the evidence at trial justified the use of the term. It’s not like Stanford could be any more insulted. The prosecutors also compared him to Bernie Madoff. That too caused Fazel to speak up on behalf of Stanford by saying of Madoff, “he didn’t invest time in anything.” Not sure what he was going for with that comment but I took it that Stanford worked harder at his fraud than did Madoff.
Speaking on his own behalf, Stanford recounted his last three years, including his beating in September 2009. The best that he could say as a compliment for those who prosecuted him was, “I wouldn’t wish this on them.” While he acknowledge that he felt sorry for depositors, employees and his own family for the failure of Stanford Financial, he managed to slip in, “I’m not a thief,” and, “I never defrauded anyone.” Victims in the courtroom, all dressed in black, begged to differ.
The prison sentence represents a long fall from the once knighted Antiguan, who has been in prison since his arrest in June 2009. Declared indigent by the court, all of Stanford’s assets were frozen and he was represented by a public defender. In March, Stanford was found guilty of running a $7 billion Ponzi scheme. However, his road to the courthouse was not without controversy. First, there was that strange interview on CNBC in which Stanford proclaimed his innocence. Then Stanford sued Lloyd’s of London, the underwriter of Stanford Financial Group’s Directors and Officers insurance, to pay for his legal fees. In the end, Lloyd’s won and Stanford got the legal help of public defenders Ali Fazel and Robert Scardino.
Stanford learned that prison can be a difficult place to live. Long before being tried in court, Stanford was severely beaten by another inmate. He was hospitalized and later transferred to a federal prison medical facility in Butner, NC, as result of an addiction to anti-depressants, which he developed after the beating. The trauma, his lawyers claimed, left their client unable to remember anything. After a year’s delay in heading to trial, government psychologists determined he was faking it and set a court date.
In January, just 12 days before Stanford’s trial was to begin, Fazel and Scardino wanted out of the case on the grounds that budget restrictions were hurting their ability to defend him. Prior to that, a number of supporting groups and expert witnesses for the defense said that they too wanted to quit because they were not being paid by the government. Eventually, some money was released and Stanford was off to trial.
With all of this drama, there still has been no distribution of the funds that have been seized by the government to victims who had invested their savings with Stanford in the hopes of incredible returns on safe (certificates of deposit) investments. The trial and the prison sentence will bring some closure, but the restitution to investors will come up a little short. With regard to the losses for U.S. taxpayers? We will be paying for Stanford’s prison stay and his future legal fees. Stanford is planning to appeal and the court will be giving him a new public defender.
Stanford’s most memorable statement was, “If I live the rest of my life in prison …. I will always be at peace with the way I conducted myself in business.” He can think about that one for a while.
My thanks to Twitterers Ronnie Crocker and CNBC’s Scott Cohn, who gave us all updates during the sentencing.
Dressed in green prison fatigues, R. Allen Stanford entered a federal courthouse in Houston today to hear U.S. District Judge David Hitner pronounce his prison sentence. The decision: 110 years.
Prosecutors had asked that the one-time billionaire financier get 230 years in prison. (note: Bernard Madoff is serving 150 years). The prosecutor told Judge Hitner, “230 years will not get anyone their money back but on sleepless nights they will know that he got the maximum.” I think 110 years will give them just as much comfort.
During the proceeding, Stanford’s attorney, Ali Fazel, objected to the use of the term “Ponzi scheme,” but Hittner said the evidence at trial justified the use of the term. It’s not like Stanford could be any more insulted. The prosecutors also compared him to Bernie Madoff. That too caused Fazel to speak up on behalf of Stanford by saying of Madoff, “he didn’t invest time in anything.” Not sure what he was going for with that comment but I took it that Stanford worked harder at his fraud than did Madoff.
Speaking on his own behalf, Stanford recounted his last three years, including his beating in September 2009. The best that he could say as a compliment for those who prosecuted him was, “I wouldn’t wish this on them.” While he acknowledge that he felt sorry for depositors, employees and his own family for the failure of Stanford Financial, he managed to slip in, “I’m not a thief,” and, “I never defrauded anyone.” Victims in the courtroom, all dressed in black, begged to differ.
The prison sentence represents a long fall from the once knighted Antiguan, who has been in prison since his arrest in June 2009. Declared indigent by the court, all of Stanford’s assets were frozen and he was represented by a public defender. In March, Stanford was found guilty of running a $7 billion Ponzi scheme. However, his road to the courthouse was not without controversy. First, there was that strange interview on CNBC in which Stanford proclaimed his innocence. Then Stanford sued Lloyd’s of London, the underwriter of Stanford Financial Group’s Directors and Officers insurance, to pay for his legal fees. In the end, Lloyd’s won and Stanford got the legal help of public defenders Ali Fazel and Robert Scardino.
Stanford learned that prison can be a difficult place to live. Long before being tried in court, Stanford was severely beaten by another inmate. He was hospitalized and later transferred to a federal prison medical facility in Butner, NC, as result of an addiction to anti-depressants, which he developed after the beating. The trauma, his lawyers claimed, left their client unable to remember anything. After a year’s delay in heading to trial, government psychologists determined he was faking it and set a court date.
In January, just 12 days before Stanford’s trial was to begin, Fazel and Scardino wanted out of the case on the grounds that budget restrictions were hurting their ability to defend him. Prior to that, a number of supporting groups and expert witnesses for the defense said that they too wanted to quit because they were not being paid by the government. Eventually, some money was released and Stanford was off to trial.
With all of this drama, there still has been no distribution of the funds that have been seized by the government to victims who had invested their savings with Stanford in the hopes of incredible returns on safe (certificates of deposit) investments. The trial and the prison sentence will bring some closure, but the restitution to investors will come up a little short. With regard to the losses for U.S. taxpayers? We will be paying for Stanford’s prison stay and his future legal fees. Stanford is planning to appeal and the court will be giving him a new public defender.
Stanford’s most memorable statement was, “If I live the rest of my life in prison …. I will always be at peace with the way I conducted myself in business.” He can think about that one for a while.
My thanks to Twitterers Ronnie Crocker and CNBC’s Scott Cohn, who gave us all updates during the sentencing.
Friday, 9 March 2012
Jurors: 'Difficult process'
By Terri Langford and Lindsay Wise
Thursday, March 8, 2012
Jurors who convicted R. Allen Stanford of fraud agreed early in their
deliberations that he was guilty of all but one of the charges against him,
found the government's star witness credible and felt sympathy for investors who lost millions, they said after completing their seven weeks of duty Thursday.
"The jury returned unanimous verdicts, and we think they speak for
themselves," said foreman John Wojciak. "It was a difficult process. We went through each piece of evidence. I think we worked very hard. We did the best job we could for 12 people."
Earlier this week, the four-woman, eight-man jury convicted the 61-year-old
native Texan of masterminding a $7 billion investor fraud through his bank
in the Caribbean nation of Antigua. On Thursday, the same jury decided that
$330 million located in international bank accounts belonged to Stanford's
investors, clearing the way for the U.S. government to get that money back.
Another juror, accountant David Wright, said the jury would like to have
heard from Stanford, who chose not to testify, but that it wouldn't have
changed the result.
Juror Lendon Hilburn, a retiree, agreed: "I thought overall it was
convincing."
Bruce Forrest, 47, who heard all the testimony but was dismissed as an
alternate before the start of deliberations, returned to the courthouse to
visit with his former jury colleagues after they completed their work. "The
totality of the information from the government was overwhelming," he said.
Forrest, a Pasadena optician, added that although investors won't get all
their money back, he hoped the verdict will bring them some comfort.
"It was not their fault," he said, adding that he hopes U.S. District Judge
David Hittner sentences Stanford to as much prison time as possible. "I hope he never sees the light of day," Forrest said.
The six weeks of testimony were trying for jurors. But the government's
case, from their view, appeared solid. Still, they said they combed
carefully through boxes of evidence to find Stanford guilty on 13 of 14
fraud related counts.
"We talked about every charge over and over until we got it right," said
juror Michael Madrigal, 39, owner of Mike's Pawn Shop in Houston.
Wright and Forrest found the government's star witness, former Stanford
Financial Chief Financial Officer James Davis, more than credible. Davis,
the financial services empire's No. 2 executive, pleaded guilty for his part in the decades-old scheme, in exchange for his testimony against his boss and former Baylor University roommate.
"I found him believable even though he had made the deal with the
government," Wright said.
Jurors interviewed said that Stanford misled investors who bought
certificates of deposit from the Antiguan bank.
"When you do people wrong like that - and he did it for so long - it was all going to catch up with him," Madrigal said. "And it caught up with him, and he deserves what he got."
Referring to the decision Thursday allowing the government to pursue the
money in bank accounts, Madrigal said, "I'm glad we got every dime we could
from him. ... He still owes them (investors) 7 billion dollars."
Stanford, who could spend the rest of his life in prison on the criminal
conviction, showed no reaction to Thursday's forfeiture verdict - which
involved some accounts that he never controlled but which the jury found
contained money obtained illegally.
Antiguan authorities also are seeking to claim some of the accounts -
proceeds of which eventually could go to pay back some of the millions of
dollars investors lost.
After reading the verdict on the forfeiture issue, U.S. District Judge David Hittner thanked the jurors for service that began Jan. 23, telling them they had "performed admirably." He set Stanford's sentencing for June 14, and said he will hear victim impact statements from investors who lost money.
Stanford's lawyers have said he will appeal the conviction, and defense
attorney Robert Scardino suggested Thursday that one key appeal point might
be the lack of adequate preparation time. Hittner ruled a month before trial that Stanford was competent, after treatment for addiction to medications prescribed when he was injured in a jailhouse fight in 2009. His lawyers had argued that he suffered memory loss that limited his ability to aid in his defense.
"Our client spent almost nine months in a mental facility in North Carolina
before the trial," Scardino said. "We had 30 days with a competent client."
Thursday, March 8, 2012
Jurors who convicted R. Allen Stanford of fraud agreed early in their
deliberations that he was guilty of all but one of the charges against him,
found the government's star witness credible and felt sympathy for investors who lost millions, they said after completing their seven weeks of duty Thursday.
"The jury returned unanimous verdicts, and we think they speak for
themselves," said foreman John Wojciak. "It was a difficult process. We went through each piece of evidence. I think we worked very hard. We did the best job we could for 12 people."
Earlier this week, the four-woman, eight-man jury convicted the 61-year-old
native Texan of masterminding a $7 billion investor fraud through his bank
in the Caribbean nation of Antigua. On Thursday, the same jury decided that
$330 million located in international bank accounts belonged to Stanford's
investors, clearing the way for the U.S. government to get that money back.
Another juror, accountant David Wright, said the jury would like to have
heard from Stanford, who chose not to testify, but that it wouldn't have
changed the result.
Juror Lendon Hilburn, a retiree, agreed: "I thought overall it was
convincing."
Bruce Forrest, 47, who heard all the testimony but was dismissed as an
alternate before the start of deliberations, returned to the courthouse to
visit with his former jury colleagues after they completed their work. "The
totality of the information from the government was overwhelming," he said.
Forrest, a Pasadena optician, added that although investors won't get all
their money back, he hoped the verdict will bring them some comfort.
"It was not their fault," he said, adding that he hopes U.S. District Judge
David Hittner sentences Stanford to as much prison time as possible. "I hope he never sees the light of day," Forrest said.
The six weeks of testimony were trying for jurors. But the government's
case, from their view, appeared solid. Still, they said they combed
carefully through boxes of evidence to find Stanford guilty on 13 of 14
fraud related counts.
"We talked about every charge over and over until we got it right," said
juror Michael Madrigal, 39, owner of Mike's Pawn Shop in Houston.
Wright and Forrest found the government's star witness, former Stanford
Financial Chief Financial Officer James Davis, more than credible. Davis,
the financial services empire's No. 2 executive, pleaded guilty for his part in the decades-old scheme, in exchange for his testimony against his boss and former Baylor University roommate.
"I found him believable even though he had made the deal with the
government," Wright said.
Jurors interviewed said that Stanford misled investors who bought
certificates of deposit from the Antiguan bank.
"When you do people wrong like that - and he did it for so long - it was all going to catch up with him," Madrigal said. "And it caught up with him, and he deserves what he got."
Referring to the decision Thursday allowing the government to pursue the
money in bank accounts, Madrigal said, "I'm glad we got every dime we could
from him. ... He still owes them (investors) 7 billion dollars."
Stanford, who could spend the rest of his life in prison on the criminal
conviction, showed no reaction to Thursday's forfeiture verdict - which
involved some accounts that he never controlled but which the jury found
contained money obtained illegally.
Antiguan authorities also are seeking to claim some of the accounts -
proceeds of which eventually could go to pay back some of the millions of
dollars investors lost.
After reading the verdict on the forfeiture issue, U.S. District Judge David Hittner thanked the jurors for service that began Jan. 23, telling them they had "performed admirably." He set Stanford's sentencing for June 14, and said he will hear victim impact statements from investors who lost money.
Stanford's lawyers have said he will appeal the conviction, and defense
attorney Robert Scardino suggested Thursday that one key appeal point might
be the lack of adequate preparation time. Hittner ruled a month before trial that Stanford was competent, after treatment for addiction to medications prescribed when he was injured in a jailhouse fight in 2009. His lawyers had argued that he suffered memory loss that limited his ability to aid in his defense.
"Our client spent almost nine months in a mental facility in North Carolina
before the trial," Scardino said. "We had 30 days with a competent client."
Stanford Must Forfeit All Funds in Seized Accounts, Houston Jury Decides
By Andrew Harris and Laurel Brubaker Calkins - Mar 8, 2012
R. Allen Stanford, who was convicted of running a $7 billion investment
fraud, must forfeit all funds seized by the U.S. government, a federal jury
in Houston said, finding that the money constituted proceeds of the scheme.
The jury of eight men and four women returned their verdict today in their
second day of deliberations in the forfeiture proceeding, which began less
than three hours after they returned guilty verdicts March 6 on 13 of 14
criminal counts against Stanford, 61.
R. Allen Stanford was convicted of fraud in what prosecutors said was a $7
billion scheme involving bogus certificates of deposit at his Antigua-based
bank. A federal jury in Houston today found the financier guilty of all but
one of the 14 counts against him, including wire and mail fraud and
obstructing a federal regulatory investigation. Stanford, 61, faces as long
as 20 years in prison for each fraud count.
Prosecutors said Stanford defrauded investors who bought certificates of
deposit from his Antigua bank. The jury granted total forfeiture on 29
accounts prosecutors said are worth $330 million.
"We won't say it's what we expected," Ali Fazel, one of Stanford's
attorneys, said after the forfeiture verdict.
Before the decision was announced, Stanford sat with his lawyers at the
defense table, laughing occasionally. As the verdict was read, he looked
over at his mother, Sammie, and his daughter Randi. The two women later left the courthouse carrying the suit and dress shirt Stanford had worn in court.
Stanford was ordered to forfeit money deposited in bank accounts in London,
Zurich, Geneva and elsewhere, which prosecutors said was the product of
criminal activity.
'Proceeds Remain Proceeds'
"Proceeds remain proceeds," Andrew Warren, a federal prosecutor, told the
jury in a closing statement. "It's CD depositor money, money that should be
forfeited."
Stanford was found guilty of lying to investors about the nature and
oversight of the certificates of deposit issued by Antigua-based Stanford
International Bank Ltd. and sold in the U.S. by his Houston-based securities firm, Stanford Group Co.
After a six-week trial, the jury convicted him on four counts of wire fraud
and five counts of mail fraud, each of which carries a top sentence of 20
years in prison. He was also convicted of conspiracy and obstructing a U.S.
Securities and Exchange Commission probe. He was found not guilty of one
wire fraud count. U.S. District Judge David Hittner set June 14 for
sentencing.
"The jury returned unanimous verdicts and we think they speak for
themselves," John Wojciak, the jury foreman, said today after the forfeiture trial. "It was a very difficult process."
Boxes of Evidence
The jury examined 10 to 12 boxes of evidence, said Wojciak, an environmental engineer. He refused to answer questions from reporters.
Billie Wade, 69, a retired hairdresser who described herself during jury
selection as "the dumbest person in this room," said Stanford's arrogance
made the biggest impression on her, more than any evidence or testimony.
"His arrogance, every day," she said.
Bruce Forrest, a 47-year-old alternate juror, was dismissed before
deliberations began and returned to the courthouse today. He said
prosecutors presented "overwhelming evidence" of Stanford's guilt.
Forrest said James Davis, Stanford's former finance chief, was the most
compelling witness. Davis, who reached a guilty- plea agreement with the
U.S. in 2009, testified for five days against Stanford.
Forrest said he believed Davis "even though he made that deal with the
government."
Stanford, who didn't testify, maintains his innocence. His defense lawyers
argued that the Stanford organization had enough assets to honor its
commitments until the SEC sued in February 2009 and won a court order
freezing his holdings and appointing a receiver to liquidate them.
'Missed Any Issues'
Robert Scardino, Stanford's other attorney, said he and Fazel will ask the
court to have other lawyers review their work to see if they made any
mistakes or "missed any issues."
Fazel said there are many grounds for appeal.
Stanford, who sustained head injuries in a 2009 inmate assault at a jail in
Houston, developed an addiction to prescription anti-anxiety drugs and spent almost nine months in a federal prison hospital. His lawyers tried to delay the trial, arguing that their client was suicidal and might never
sufficiently recover from the beating to face a jury.
Hittner declared Stanford legally competent and ordered the trial to go
ahead.
"That will be an issue," Fazel said. "It will be a lengthy appeal."
R. Allen Stanford, who was convicted of running a $7 billion investment
fraud, must forfeit all funds seized by the U.S. government, a federal jury
in Houston said, finding that the money constituted proceeds of the scheme.
The jury of eight men and four women returned their verdict today in their
second day of deliberations in the forfeiture proceeding, which began less
than three hours after they returned guilty verdicts March 6 on 13 of 14
criminal counts against Stanford, 61.
R. Allen Stanford was convicted of fraud in what prosecutors said was a $7
billion scheme involving bogus certificates of deposit at his Antigua-based
bank. A federal jury in Houston today found the financier guilty of all but
one of the 14 counts against him, including wire and mail fraud and
obstructing a federal regulatory investigation. Stanford, 61, faces as long
as 20 years in prison for each fraud count.
Prosecutors said Stanford defrauded investors who bought certificates of
deposit from his Antigua bank. The jury granted total forfeiture on 29
accounts prosecutors said are worth $330 million.
"We won't say it's what we expected," Ali Fazel, one of Stanford's
attorneys, said after the forfeiture verdict.
Before the decision was announced, Stanford sat with his lawyers at the
defense table, laughing occasionally. As the verdict was read, he looked
over at his mother, Sammie, and his daughter Randi. The two women later left the courthouse carrying the suit and dress shirt Stanford had worn in court.
Stanford was ordered to forfeit money deposited in bank accounts in London,
Zurich, Geneva and elsewhere, which prosecutors said was the product of
criminal activity.
'Proceeds Remain Proceeds'
"Proceeds remain proceeds," Andrew Warren, a federal prosecutor, told the
jury in a closing statement. "It's CD depositor money, money that should be
forfeited."
Stanford was found guilty of lying to investors about the nature and
oversight of the certificates of deposit issued by Antigua-based Stanford
International Bank Ltd. and sold in the U.S. by his Houston-based securities firm, Stanford Group Co.
After a six-week trial, the jury convicted him on four counts of wire fraud
and five counts of mail fraud, each of which carries a top sentence of 20
years in prison. He was also convicted of conspiracy and obstructing a U.S.
Securities and Exchange Commission probe. He was found not guilty of one
wire fraud count. U.S. District Judge David Hittner set June 14 for
sentencing.
"The jury returned unanimous verdicts and we think they speak for
themselves," John Wojciak, the jury foreman, said today after the forfeiture trial. "It was a very difficult process."
Boxes of Evidence
The jury examined 10 to 12 boxes of evidence, said Wojciak, an environmental engineer. He refused to answer questions from reporters.
Billie Wade, 69, a retired hairdresser who described herself during jury
selection as "the dumbest person in this room," said Stanford's arrogance
made the biggest impression on her, more than any evidence or testimony.
"His arrogance, every day," she said.
Bruce Forrest, a 47-year-old alternate juror, was dismissed before
deliberations began and returned to the courthouse today. He said
prosecutors presented "overwhelming evidence" of Stanford's guilt.
Forrest said James Davis, Stanford's former finance chief, was the most
compelling witness. Davis, who reached a guilty- plea agreement with the
U.S. in 2009, testified for five days against Stanford.
Forrest said he believed Davis "even though he made that deal with the
government."
Stanford, who didn't testify, maintains his innocence. His defense lawyers
argued that the Stanford organization had enough assets to honor its
commitments until the SEC sued in February 2009 and won a court order
freezing his holdings and appointing a receiver to liquidate them.
'Missed Any Issues'
Robert Scardino, Stanford's other attorney, said he and Fazel will ask the
court to have other lawyers review their work to see if they made any
mistakes or "missed any issues."
Fazel said there are many grounds for appeal.
Stanford, who sustained head injuries in a 2009 inmate assault at a jail in
Houston, developed an addiction to prescription anti-anxiety drugs and spent almost nine months in a federal prison hospital. His lawyers tried to delay the trial, arguing that their client was suicidal and might never
sufficiently recover from the beating to face a jury.
Hittner declared Stanford legally competent and ordered the trial to go
ahead.
"That will be an issue," Fazel said. "It will be a lengthy appeal."