Judge denies bail for Stanford

Johnny Hanson Chronicle R. Allen Stanford (shown at Monday’s court date) was recently returned to Houston from Virginia.

R. Allen Stanford won’t trade his orange prison-issue jumpsuit for street clothes anytime soon, a judge ruled Tuesday.

Senior U.S. District Judge David Hittner said Stanford must remain jailed, revoking a magistrate’s order last week granting him release on bail.

Stanford, 59, faces 21 counts of conspiracy, fraud, bribery and obstruction of justice. He’s accused of helping bilk investors in a $7 billion fraud centered on certificates of deposit issued by an offshore bank that was part of his fallen global empire, Houston-based Stanford Financial Group.

His lawyer, Dick DeGuerin, said Hittner’s decision will be taken to the 5th U.S. Circuit Court of Appeals. “We are very disappointed,” DeGuerin said.

Ian McCaleb, a Justice Department spokes-man, said prosecutors “believe the judge made the correct ruling today.”

A Houston grand jury indicted Stanford and four others in the alleged scheme, including a former top regulator in the Caribbean nation of Antigua and Barbuda, where Stanford International Bank is located. A sixth defendant was indicted in Miami, accused of destroying records.

A separate criminal charge in Houston accuses James Davis, Stanford Financial Group’s former chief financial officer, of conspiracy and fraud. His lawyer has said Davis is cooperating with prosecutors. Davis is scheduled to make a first court appearance later this month.

While the others named in the Texas indictment are free pending trial, prosecutors argued that Stanford is a flight risk because he hasn’t lived in the U.S. for 15 years, has global contacts, has access to significant cash from others and has a motive to disappear because he faces decades in prison if convicted.

DeGuerin argued in vain for Hittner to uphold U.S. Magistrate Judge Frances Stacy’s order last week that Stanford be released on $500,000 bond, noting his client’s repeated – and rebuffed – efforts to turn himself in to federal authorities before he was indicted June 18.

Stacy also had ordered that Stanford wear a GPS device and live with his girlfriend in a high-rise apartment in Houston’s museum district, where a friend of his daughter’s paid $36,000 to cover a year’s rent.

Stanford was arrested in Virginia after he was indicted, and brought last week to a Montgomery County facility used to hold federal prisoners.

Hittner noted in his order that Stanford’s professed ties to Houston “are tenuous at best and of recent vintage,” established only when the frequent world traveler and Caribbean resident realized authorities were closing in and a criminal trial was looming.

“Although he claims his children are moving to Houston, that too is only due to Stanford’s impending trial in Houston,” Hittner wrote.

DeGuerin argued that Stanford, identified by Forbes last year as the 205th-richest American with a net worth of more than $2 billion, is penniless since his assets were frozen in February when the Securities and Exchange Commission filed civil charges that he and others ran a “massive Ponzi scheme.”

However, prosecutors suggested that the $36,000 rent paid by his daughter’s friend illustrates Stanford’s access to cash.

Source: http://www.chron.com/disp/story.mpl/front/6505014.html