Stanford guilty of bilking investors of billions

Tue Mar 6, 2012 6:46pm EST
 
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By Anna Driver

HOUSTON (Reuters) - Allen Stanford was convicted on Tuesday of running a $7 billion Ponzi scheme, a verdict that caps a riches-to-rags trajectory for the former Texas financier and Caribbean playboy.

It was a vindication for the U.S. government, which closed down Stanford's financial empire in February 2009 but had failed for years to address signs that the business was built on air. The Stanford case was the biggest investment fraud since Bernard Madoff's.

Stanford was found guilty on 13 of 14 criminal counts, including fraud, conspiracy and obstructing an investigation by the U.S. Securities and Exchange Commission.

As Stanford, 61, was led out of the courtroom after the verdict, he touched his fist to his heart and looked at the bench where his mother and two daughters sat. He has been jailed since his June 2009 arrest.

"We're disappointed in the outcome," said Stanford attorney Ali Fazel. "We do expect an appeal." He said he expects sentencing in several months.

The charges carry a potential prison sentence of more than 200 years if the terms are served consecutively, but Stanford is more likely to face a maximum of about 20 years if, as is typical in white-collar cases, he is sentenced to concurrent prison terms.

The verdict came less than a day after the Houston federal jury said it could not reach a decision, and U.S. District Judge David Hittner instructed jurors to keep deliberating.

Still, the verdict may prove only a moral victory for Stanford's victims. Most have received none of the money back they invested in Stanford's certificates of deposit, though prosecutors are trying to seize more than $300 million in offshore assets tied to Stanford and other entities that have been frozen.   Continued...

 
Allen Stanford leaves the Federal Courthouse where the jury found him guilty, in Houston, March 6, 2012.    REUTERS/Richard Carson