Legal News

Davis Pleads; Court Orders Asset Sale for Ill Stanford

By Ashby Jones

Strange. We’ve been sitting here for most of August, tapping idly on this keyboard, waiting for more news on the Allen Stanford front. Today, we’re hit with a big wave of it. Let’s bring you up to speed.

Davis Pleads: The world has long known that James Davis, the former CFO of Stanford Bank, planned to plead guilty to three counts of fraud and conspiracy in connection with the meltdown of the bank.

Today, Davis entered that plea in federal court in Houston. Click here for the early story, from the Houston Chron. Davis faces a maximum of 30 years in prison, though his sentence will likely be far less, given his willingness to cooperate.

Stanford Illin’: Meanwhile, Stanford was taken earlier Thursday to the hospital, after his pulse-rate reached 300. Click here for the Bloomberg story. According to the Bloomberg story, Stanford was to have been in court for a hearing on his legal defense and how his lawyer is to be paid. (Earlier this month, news broke that Stanford was swapping attorneys, from Houston-based Dick DeGuerin to Patton Boggs’s Bob Luskin, provided Stanford could come up with the dough to pay Luskin.) In any event, Stanford failed to show up at Thursday’s scheduled hearing; instead he was taken for medical attention.

No word on whether his medical issues had anything to do with where Stanford is being held. In July, Stanford requested he be transferred from a detention center in Conroe, Texas, to one in downtown Houston, as he alleged the conditions in Conroe were “intolerable.” The motion was denied.

A Court-Ordered Sale: Dallas federal judge David Godbey ruled on Wednesday that Stanford’s investments in an Israeli development fund and a luxury Houston hotel can be sold immediately, over objections from the financier that he hasn't been convicted of any wrongdoing. The ruling was a win for court-appointed receiver Ralph Janvey, who had argued that the sale would help stave off capital calls or diluting the investments. Click here for the story, from Bloomberg.

Of course, we’ll report further any news on Stanford’s health or on the status of his legal representation.

Full post as published by Law Blog - WSJ.com on August 27, 2009 (boomark / email).