Superseding indictment drops seven counts against R. Allen Stanford

The federal government filed a superseding indictment on May 4 against R. Allen Stanford of Houston that drops seven counts of the 21 criminal counts against him. The superseding indictment in United States v. Robert Allen Stanford brings a total of 14 counts against the former chairman of Stanford Financial Group: one count of conspiracy to commit wire fraud and mail fraud, five counts of wire fraud, five counts of mail fraud, one count of conspiracy to obstruct SEC investigation, one count of obstruction of SEC investigation and one count of conspiracy to commit money laundering. It drops two wire fraud counts and five mail fraud counts. The government alleges in the superseding indictment that, beginning in 1990, Stanford and others “perpetrated a scheme to defraud investors who purchased SIB [Stanford International Bank] CDs of billions of dollars by soliciting funds under false pretenses, failing to invest those funds as promised, misappropriating funds for personal use, creating and disseminating false and fraudulent documents to investors falsely showing how their funds had been invested, and funneling bribes to Antiguan regulators and the Outside Auditor to conceal the scheme.” Stanford will be arraigned on the charges in the superseding indictment, but he pleaded not guilty to the charges in the February 2009 original indictment. Stanford is currently is custody at the Federal Medical Center at Butner Federal Correctional Complex in Butner, N.C. He is undergoing treatment to end his dependence on prescription drugs, according to testimony at an evidentiary hearing on his competency in January. Stanford’s trial was set for January, but U.S. District Judge David Hittner of the Southern District of Texas delayed it after finding Stanford was mentally incompetent to stand trial. Robert Scardino, a partner in Scardino & Fazel in Houston, who represents Stanford says, “The government has obviously decided to change somewhat its approach to prosecuting Mr. Stanford.” Scardino declines further comment because of a gag order Hittner imposed in the case. Gregg Costa, an assistant U.S. attorney in the Southern District of Texas who is the lead prosecutor, declines comment, citing the gag order.
-- Brenda Sapino Jeffreys