Las víctimas olvidadas de Stanford ahora disponible en español

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Wednesday, August 25, 2010

Court hearing on Stanford defense fees begins

Almost $2 billion in personal loans, cooked books and misrepresentations to investors are reasons Allen Stanford, accused of a $7 billion Ponzi scheme, should not be able to collect on an policy covering his defense fees, a lawyer for the insurer said on Tuesday.
Former billionaire Stanford and three other defendants in the government's case sued Lloyd's of London, arguing they are entitled to the legal fees from a directors and officers policy.

That policy has a money laundering exclusion, so it is up to the insurer to prove the plaintiffs committed that act in several days of hearings scheduled this week in federal court in Houston.

"These plaintiffs engaged in money laundering and there is no coverage on this policy," Barry Chasnoff, an attorney for Lloyd's said in his opening arguments after outlining an alleged scheme Stanford used to mislead investors.

The information Chasnoff spoke of is largely part of the U.S. government's case against Stanford and has previously been released in court documents and the criminal indictment.

Lloyd's has paid some claims under the policy, including $6 million for lawyers who represented Stanford. In March, a federal appeals court said Lloyd's could not refuse to pay the claims, but sent the case back to district court for additional arguments to determine if money laundering occurred.

U.S. District Judge Nancy Atlas is presiding over the hearings.


Before opening statements, Atlas said Laura Holt, Stanford's former chief investment officer, had settled with the insurer. No other details were provided.

Stanford, 60, is accused of leading the Ponzi scheme that used phony certificates of deposit issued by Stanford International Bank in Antigua to bilk investors around the world.

"The evidence will show there wasn't any Ponzi scheme," Robert Bennett," a Houston-based attorney representing Stanford, said at the hearing. "There wasn't any type of fraud committed. There wasn't any misrepresentation."

He described Stanford as a well-respected, legitimate businessman whose fortunes were ruined when the government swooped in and filed civil and criminal charges last year.

The series of hearings is seen by some to be a preview

of Stanford's criminal defense. Stanford is currently in jail, awaiting a January 2011 trial.

Stanford and accounting executives Mark Kuhrt and Gilbert Lopez, as well as Holt have pleaded not guilty to the charges.

Lawyers for Lopez and Kuhrt said in their opening arguments there will be no evidence at the hearing showing their clients profited from the alleged scheme.

"There aren't any smoking guns," Mark Kuniansky, Kuhrt's lawyer told Atlas. "Underwriters have the burden of proof and they will not meet that proof."

Stanford faces one count of conspiracy to commit money laundering as part of a 21-count June 2009 indictment. The charging document also accuses the Texas financier, who once owned luxury homes and automobiles and lavished money on sporting events, of wire fraud and conspiracy.

The hearings are expected to last up to four days.

The case is Laura Pendergest-Holt, R. Allen Stanford, Gilbert Lopez and Mark Kuhrt v Certain Underwriters at Lloyd's of London and Arch Specialty Insurance Co, U.S. District Court, Southern District of Texas, No. 09-3712.

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