Investors ask court to free funds in Stanford case
Court Alerts
Investors unable to access $1.7 billion connected to companies owned by Texas billionaire R. Allen Stanford asked a federal appeals court Monday for access to their money.
The holders of about 4,000 accounts had their constitutional rights violated when a district judge in Dallas froze their Stanford-related assets, according to documents filed with the 5th U.S. Circuit Court of Appeals in New Orleans. The pleading also argues that the judge and a court-appointed receiver don't have jurisdiction over an Antigua-based bank connected to the alleged fraud.
The Securities and Exchange Commission filed a lawsuit in February accusing Stanford and his top financial officer of running a "massive Ponzi scheme" that defrauded investors of about $8 billion. Stanford has denied the allegations, and did so again Monday night during a tearful interview aired on ABC's "World News with Charles Gibson."
Attorney Michael Quilling, who represents about 35 account holders, said a favorable ruling on his pleading would result in the court unlocking the 4,000 accounts that the receiver has so far declined to release. He also questioned whether Dallas attorney Ralph Janvey, the court-appointed receiver, has jurisdiction in the case, calling Janvey "a king without a country."
"The big issue here is that right now thousands of Americans are having their due process rights trampled under the guise of an order that is based on no jurisdiction," Quilling said. "This is a second victimization. (Account holders) were victimized by the bank and its fraudulent practices and are now being victimized by the court and the receiver."
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