Stanford’s Attorney Firmly Denies SEC Ponzi Scheme Charges

Dick DeGuerin, the Houston criminal defense lawyer representing financier Allen Stanford against charges of orchestrating an $8 billion Ponzi scheme, is accusing the Securities and Exchange Commission of going after his client only to distract from its fumbling of the Bernard Madoff financial scandal.

DeGuerin, in an interview with BusinessWeek’s Unstructured Finance blog, accused the SEC of charging Stanford only to deflect criticism over its failure to stop Madoff’s fraudulent investment scheme.

“This is not a Ponzi scheme,” DeGuerin told the website. “The SEC is using Stanford as a distraction from its failures in Madoff. This is not Madoff.”

Madoff and Stanford are the two biggest names to be accused of billion-dollar investment frauds amid the nation’s continuing economic crisis. Madoff pleaded guilty on March 12, 2009 and admitted he swindled investors out of as much as $65 billion in a Ponzi scheme in which initial investors were paid profits from funds taken from later investors.

Madoff faces up to 150 years in prison when he is sentenced on June 16.

Stanford Charged With Lying to Investors

Stanford’s alleged crimes center around sales of fraudulent certificates of deposit in his Antigua-based Stanford International Bank. Securities regulators accuse him of lying about returns the investments could earn and ripping off investors through the United States, the Caribbean, and Latin America.

However, according to DeGuerin, the charges of wrongdoing against Stanford will be proven false.

“There are hard assets for every dollar invested,” DeGuerin said. “The losses in the Stanford case are right in line with the stock market.”

Defense Team is Gearing Up

DeGuerin, who has represented a variety of clients ranging from Republican House Majority Leader Tom DeLay to notorious Texas cult leader David Koresh, said he plans to ask a judge to unfreeze some of Stanford’s reported $2.2 billion in assets so the banker can pay for his own legal defense.

Stanford and two of his two corporate officers are charged in a civil SEC complaint with securities fraud. His former chief investment officer has also been charged with a crime for allegedly lying about her role in the company and misrepresenting her knowledge of Stanford’s alleged crimes.

Jim Davis, Stanford’s close personal ally and former chief financial officer, is now cooperating with authorities, but DeGuerin said he and his client are not worried.

“If he (Davis) tells the truth, it doesn’t concern us,” he said.

No related posts.