Stanford, Assets Frozen, Can’t Pay Lawyer

Aug 14 2009 | 11:33am ET

Sometimes, constitutional rights can be a double-edged sword. Just ask hedge fund manager and accused Ponzi schemer R. Allen Stanford.

Just like his fellow accused hedge fund fraudster Arthur Nadel, Stanford is having troubled holding onto lawyers because he can’t pay them, thanks to an asset freeze imposed by the Securities and Exchange Commission. His current lawyer wants out, and his proposed new lawyer refuses to sign on unless he can guarantee payment.

Stanford’s current lawyer, Dick DeGuerin, says his client has no money available to pay for legal representation, which is constitutionally guaranteed. And the only way he can get that money is to give up another constitutional right, that against self-incrimination.

Stanford denies running a $7 billion Ponzi scheme. But he needs to show that the frozen assets are untainted to get them unfrozen, and anything he says in doing so could be used against him by prosecutors.

“The U.S. government and parties acting under its authority have coordinated an attack on Mr. Stanford’s constitutional rights,” DeGuerin, who’s stuck with the case until Stanford can find another lawyer, wrote in a filing last month.

Tant pis, says the U.S. attorney’s office.

“Given the clear lack of any constitutional violations, there is no basis for the relief Stanford seeks,” they responded.


In Depth

Q&A: TCA Fund Management's Bob Press on Small-Cap Private Equity

Aug 25 2016 | 8:55pm ET

The emergence of private credit as a replacement for traditional bank financing...

Lifestyle

Kiawah: Island Reversal

Aug 24 2016 | 9:59pm ET

Looking for real estate investments but the typical real estate fare isn’t cutting...

Guest Contributor

Old Hill Partners: Embrace Illiquidity

Aug 9 2016 | 2:39pm ET

The age-old financial concept that higher yields are the result of higher risk and...