Lesson from Stanford DIY Appeal

Chidem Kurdas

Allen Stanford, serving a 110-year sentence for the massive Ponzi scheme that swindled the savings of tens of thousands of people, has persisted in his appeal of the criminal conviction despite what looks like a discouraging start.

He represents himself in the appeal, having asked to be relieved of his latest court-appointed attorney and granted the wish.

Recently he appeared to seek a way to get legal help without having a lawyer. He asked that the appeals court provide him with the services of a law clerk to vet his briefs. He’d like “a qualified law clerk” to review his appeal and make sure it meets the requirements.

The appeals court clerk turned down this motion forthwith on the ground that the court provides no such service. Judges’ clerks are usually fresh law school graduates who gain experience by clerking for a year or two.

Although I lack sympathy for Mr. Stanford – knowing the damage to his victims – I have to acknowledge his sad legal predicament. By engaging in a selfie appeal, he bucks the prime directive of the legal system—namely to provide income for attorneys.

Note to those with DIY ambitions: this is a system in effect rigged against such projects. However, lawyers were happy to let Stanford go alone because he is by all reports a pain to work with. He now faces a mid-September deadline for filing a brief. The appeal was given a very low chance of success at the outset. 

Not many attorneys would argue for the grounds on which he wants to reverse his conviction, such as the U.S. having no jurisdiction over his business because the fake bank that issued fake certificates of deposit was in Antigua. While operating globally, he ran a brokerage headquartered in Houston, selling the CDs to thousands of Americans. There is no serious question that the U.S. has jurisdiction.

The scheme went on for many years despite being identified as a likely fraud by an examiner of the U.S. Securities and Exchange Commission. High-level SEC officials did not want to confront Stanford, who had far-reaching government connections and hired influential former regulators to discourage investigators. He was generous to politicians across the spectrum, including the current White House incumbent.

The SEC examiner tried repeatedly to have the agency stop Stanford, only to be frustrated and eventually deprived of her position by a Kafkaesque bureaucracy where apparently no good deed goes unpunished. For more on Stanford’s political and regulatory shenanigans, click for Sticky Wicket  

After Bernard Madoff confessed to fraud, the government finally took action against Stanford. In the aftermath, regulators took steps that resulted in an even worse situation for the victims, among them working class people who thought they were putting their retirement money in a safe investment. This sequel to the con game is one of the stories I relate in Ponzi Regulation.

Stanford went through scores of lawyers in various lawsuits since he was arrested in 2009. He initially used the remnants of his loot to pay for big names but in later years became dependent on Texas taxpayers to meet millions of dollars in legal expenses. After being long touted in the media as a high-flying billionaire, he is now indigent.

He demanded that the state spend more on his defense during the lengthy criminal trial and objected to the lawyer assigned for his appeal. Incidentally, in his heyday he wasn’t much of a taxpayer, establishing residence in the Virgin Islands to minimize his tax liability, lobbying Congress for tax breaks and when nothing else worked simply avoiding payment by not declaring income.


Tags: , ,

Leave a Reply

Please log in using one of these methods to post your comment:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: