Accused fraudster Allen Stanford is asking a federal court to lift a freeze on $10 million of his assets to pay for his legal defense.
The Texas financier was accused by the Securities and Exchange Commission in February of running a massive Ponzi scheme involving high-yielding certificates of deposit, a charge Stanford denies. Nonetheless, the SEC obtained a total freeze on Stanford's assets and those of his companies, and a criminal investigation by the Justice Department is picking up speed.
In a 12-page filing in federal court on Sunday, his attorneys argue "Allen Stanford will never have resources that remotely approach the resources of the adversaries he faces."
The filing contends the SEC freeze "instantaneously destroyed billions of dollars of net value of Stanford companies worldwide" by causing a run on the bank during a global financial crisis.
The filing asks that $10 million be placed in an escrow account controlled by Stanford's criminal defense attorney, Dick DeGuerin of Houston. And it suggests that the cost of Stanford's defense may ultimately approach $20 million.
The filing includes a blistering attack on the SEC, which it says relied on disgruntled former employees to form the foundation of its case. And, the filing argues, the case did undue damage to an already damaged banking system.
"At a time when the United States government was acting to instill confidence in its banks," the filing says, "it was precipitating a global run on Stanford's banks and investment firms and destroying the credibility that is crucial to any bank, brokerage or investment firm."
The filing says Stanford needs the money to properly defend himself. "In this Court, if not in the court of public opinion, Allen Stanford enjoys the presumption of innocence," it says.