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Securities Law

Jury in $7B Fraud Case is Having Trouble With Verdict; Judge Reads New Instruction

Posted Mar 6, 2012 9:52 AM CDT
By Martha Neil

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A federal jury in Houston hearing the fraud case against R. Allen Stanford is having trouble reaching verdict on at least some of the 14 counts against the onetime billionaire concerning accusations he bilked investors in a $7 billion Ponzi scheme.

U.S. District Judge David Hittner read the panel a new instruction on Monday afternoon and urged them to keep deliberating and reach a verdict if possible. Another jury in a new trial, should one become necessary, he pointed out, would be no better able than they to hear the same evidence and decide it, reports the Houston Chronicle.

The judge said he would ask, if the jury still can't reach a complete verdict after further deliberations, whether it has reached a verdict on any counts, reports Reuters.

The jury has been deliberating since Wednesday, after a six-week trial that ended with Stanford's decision not to testify in his own defense, according to the Associated Press and Houston Chronicle.

Bloomberg also has a story.

An Associated Press article last week recapped the closing arguments:

The government contended Stanford, 61, had flushed away billions in investor funds over a period of decades to pay for his "lavish lifestyle and his loser companies."

The defense argued that Stanford hadn't defrauded anyone and had in fact made money for investors through a legitimate global business empire.

Jailed since his 2009 arrest, Stanford is accused of running a Ponzi scheme for 20 years from an offshore bank he controlled in Antigua.

Although authorities had been nosing around for the past decade, they hesitated to open an investigation. Meanwhile, Stanford, advised by at least eight former regulators and law enforcement officials, was able to avoid close scrutiny even though Securities and Exchange Commission examiners repeatedly recommended, starting in 1997, that the SEC take a closer look at his operations, recounts a lengthy Reuters article.

Related coverage:

ABAJournal.com: "Federal Judge Says Allen Stanford Lawyers Can’t Quit, Must Defend Him in Upcoming $7B Fraud Trial"

ABAJournal.com: "Stanford Lawyers to Blame Feds, Economy for Investors’ $7B Loss at Fraud Trial Beginning in Texas"

Telegraph (2009): "Sir Allen Stanford: how the small-town Texas boy evaded scrutiny to become a big-time 'fraudster'"

Wall Street Journal (sub. req.): "Prosecutor Sums Up: Stanford Lied for Decades"

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