Allen Stanford, the Texan financier who bankrolled English cricket before being arrested on fraud charges in 2009, has launched a $7.2bn (£4.5bn) lawsuit against officials of the US government, saying they wrecked his business empire and left him with only the suit he was wearing – all before he had even had a chance to defend himself in court.
Mr Stanford’s trial had been due to start last month in Houston, but he was ruled medically unfit to face justice after a prison beating and drug problems.
And now, in a dramatic attempt to turn the tables, his lawyer served civil proceedings against two FBI officers, four officials from the US Department of Justice, and five regulators from the US financial watchdog, the Securities and Exchange Commission (SEC).
His treatment has breached four amendments to the US Constitution, including prohibitions on the seizure of property and on cruel and unusual punishment, the suit says.
His business – much of which was based on the Caribbean island of Antigua – unravelled within days of civil fraud charges against him in February 2009, in which he was accused of running a pyramid scheme second in size only to Bernard Madoff’s. A receiver, Ralph Janvey, was appointed by US courts to recover what assets it could, and Mr Stanford accuses him of working not for alleged victims but rather for the US government, which filed criminal charges a few weeks later.
“Mr Stanford never had a chance to resist the forces of the combined forces of the SEC agents and Janvey,” the lawsuit says. “Through the receiver, the SEC agents successfully stripped Mr Stanford of all his personal and corporate assets worldwide, which were valued in billions of dollars… Mr Stanford was literally left with only the suit he was wearing at the time of the SEC agents’ and US marshals’ seizure of property on 17 February 2009.”
He also claims the authorities “created an environment of adverse publicity where the media have pilloried and convicted Mr Stanford before he has been afforded a right to contest the charges in open court”.
Mr Stanford says he lost assets that were worth $3.9bn when the authorities moved in on him, and future business opportunities that would have made another $3.2bn. In all, he is demanding damages of $7.2bn, plus compensation for mental anguish.
By Stephen Foley in New York
Friday, 18 February 2011
Source: The Independent