A federal judge in Dallas has ordered the Democratic and Republican parties and their congressional campaign committees to return some $1.75 million in contributions they received from accused Ponzi schemer Allen Stanford and his companies.
The political committees had fought against returning the money, but U.S. District Judge David Godbey ruled in a summary judgment that the contributions were part of the alleged fraud by Stanford, and should be returned to investors.
Godbey noted that there was no indication the political committees acted in bad faith. Nonetheless, he ordered them to pay the money back—plus interest.
The largest recipient, according to court filings, is the Democratic Senatorial Campaign Committee at $950,000, followed by the National Republican Congressional Committee at $238,500, the Democratic Senatorial Campaign Committee at $200,000, $128,500 to the Republican National Committee and $83,345 to the National Republican Senatorial Committee.
Stanford, who faces 14 criminal counts in an alleged global Ponzi scheme, was known for his political connections, helped by generous contributions to both parties.
Court-appointed receiver Ralph Janvey sued the committees in 2010 demanding the money be returned, but the committees argued they should not be held responsible because they could not have known about the alleged $7 billion fraud—which Stanford continues to deny.