Allen Stanford files $7bn case for damages against U.S. prosecutors claiming 'illegal tactics' were used in fraud probe

Daily Mail Reporter

February 18, 2011

Jailed Texas financier R. Allen Stanford has filed a lawsuit accusing prosecutors and federal agents of depriving him of his constitutional rights by using abusive law-enforcement tactics.

The flamboyant 60-year-old is accused of having cheated investors out of $7billion in a pyramid Ponzi scheme.

He pleaded not guilty to 21 counts of fraud, money laundering and obstruction and faced up to 375 years in jail if convicted.


But Stanford filed a lawsuit on Wednesday seeking $7.2billion in damages claiming that U.S. prosecutors 'undertook illegal tactics' in their investigation.

He contends that the federal government has used more than $51 million of his assets to pursue the cases against him. He claims the individuals cited in the suit violated his constitutional rights.

Stanford argues that they began the civil enforcement action solely to gather evidence for his criminal prosecution and prevented him from using his money to pay for his defense.

'Mr. Stanford is entitled to fair compensation for all property and assets taken,' said the complaint, which was signed by a Houston lawyer, Stephen R. Cochell. Many of Mr. Stanford's assets and holdings have been liquidated by a Dallas federal court-appointed receiver in the S.E.C. case.

Stanford is best known in the UK as the man behind 2008's million-dollar-a-man, winner-takes-all Twenty20 cricket contest between England and a team of West Indian all-stars.


ECB chairman Giles Clarke admitted English cricket had 'made a mistake' getting into bed with the Texan, who landed his helicopter at Lord's amid much fanfare but then embarrassed the England team at his first $20million Twenty20 game.

The team were angry that Stanford had flirted with their wives, bouncing the pregnant wife of wicketkeeper Matt Prior on his knee, and then walked into their dressing room uninvited.

Stanford is accused of running a scheme that persuaded investors to buy certificates of deposit from Stanford International Bank, located in Antigua. He has been in custody since June 2009.

Stanford's trial had been set to begin on January 24 but U.S. District Judge David Hittner agreed to delay its start until the financier can be treated for several medical problems that are affecting his competency.

The judge made his decision after a daylong hearing in which three psychiatrists testified Stanford is not competent in part because of a brain injury he suffered during a jail fight in September 2009.

U.S. District Judge David Hittner wrote in his ruling in Houston, Texas: 'The court finds Stanford is incompetent to stand trial at this time based on his apparent impaired ability to rationally assist his attorneys in preparing his defense.'

The court's finding that Stanford is incompetent, however, does not alter the court's finding that Stanford is a flight risk.'

The judge also recommended that the flamboyant Texan be sent to a medical facility within the U.S. Bureau of Prisons, namely citing the Federal Medical Center in Butner, North Carolina, where Wall Street swindler Bernard Madoff is currently serving a 150-year term for defrauding investors of $20 billion.

Psychiatrists for the government and Stanford's team who testified at a hearing earlier this month concluded that he was suffering from bouts of delirium linked to his dependency on a strong anti-anxiety medication.

They found the 60-year-old was also depressed and incompetent to stand trial due to a brain injury he sustained during a 2009 jailhouse brawl, and recommended he be weaned off the drug.

Judge Hittner denied a request by Stanford's lawyers to release him on bond and place him in a private treatment facility for his addiction.

Instead, he ordered Hittner to be committed to the custody of the attorney general to 'undergo medical treatment for his current impaired mental capacity' and get a psychiatric evaluation.

Mr Stanford rose to prominence in the UK and the Caribbean for his lavish sponsorship of cricket.

In Antigua, he was a larger-than-life figure, the island's largest employer, and the recipient of a 2006 knighthood.

But after the allegations against him surfaced, much of his support dwindled and the England and Wales Cricket Board cut ties with him.