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Alleged Ponzi Schemer Tells Judge He Doesn’t Know How His Lawyers Have Billed $6M So Far

Posted Jun 1, 2010 2:51 PM CDT
By Sarah Mui

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In the last year, insurance companies have paid out more than $6 million to lawyers for Texas billionaire R. Allen Stanford, who is accused of masterminding a $7 billion Ponzi scheme.

Yet at a hearing last week in an insurance coverage suit, Stanford said he didn't know what some of his lawyers had done for him, he didn't know much their work had cost, and he had not even met all of them, Texas Lawyer reported.

"I don't know who was and who wasn't on the case," Stanford told U.S. District Judge Nancy Atlas, who is determining whether insurance companies should pay for Stanford's defense in a criminal case and Securities and Exchange Commission civil suit. "I think it's an obscene amount of money for what's been produced."

Atlas scheduled a hearing for Thursday to determine which lawyers are currently on Stanford's legal team and ordered Lloyd's of London and Arch Specialty Insurance Co. to give Stanford a copy of all invoices from all lawyers and what they were paid.

In this insurance coverage suit, Stanford is pro se, Texas Lawyer reports, because Lee Shidlofsky or Visser Shidlofsky of Austin, Texas, withdrew with Atlas' permission because of a conflict of interest, Texas Lawyer reported.

Atlas also told Stanford at the hearing that she would ask Senior U.S. District Judge David Hittner of the Southern District of Texas to reconsider Stanford's bond request. Stanford has been in custody since June 2009.

Stanford has changed counsel many times in the last year. Last month, attorney Mike Essmyer asked Hittner if he could withdraw from his representation of Stanford, saying that Stanford had fired him. But Tex Parte Blog reports that Hittner today denied Essmyer's motion, saying that lawyer and client are "stuck with each other."

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