VOL. 124 | NO. 64 | Thursday, April 2, 2009
Pendergest-Holt Sues Former Stanford Atty.
By Andy Meek
HOT WATER: Chief investment officer of Stanford Financial Group Laura Pendergest-Holt, right, and her attorney, Dan Cogdell, leave a federal courthouse in Houston Feb. 27. Facing charges she obstructed the SEC investigation of the Stanford scandal by lying and omitting key details, she had to post a $30,000 cash bond. -- AP PHOTO/PAT SULLIVAN
Laura Pendergest-Holt, the chief investment officer of Stanford Financial Group, has filed a lawsuit against Stanford’s former attorney and his firm that claims they “hung her out to dry” and seeks damages of more than $20 million.
Pendergest-Holt has a criminal case pending against her in connection with what federal investigators have described as a massive investment fraud perpetrated by Stanford executives. A native of Baldwyn, Miss., Pendergest-Holt worked in Stanford’s East Memphis office in The Crescent Center from the mid-1990s through 2007.
The target of the complaint she filed Monday in U.S. District Court for the Northern District of Texas is former Stanford attorney Thomas Sjoblom as well as the international law firm of Proskauer Rose LLP.
Sjoblom was the only person from Stanford in the room with Pendergest-Holt in the U.S. Securities and Exchange Commission’s Fort Worth office Feb. 10. That’s when she faced five representatives of the SEC’s Division of Enforcement to give testimony under oath in the SEC’s Stanford probe.
Her testimony provided fodder for the civil and criminal complaints that followed.
But Sjoblom did not make it clear to her that he represented the interests of the company and not her own, according to the lawsuit.
“(Pendergest-Holt) reasonably and actually believed that defendants were there assisting her as her lawyers, were representing her interests and were protecting her interests,” the lawsuit says. “Instead, the defendants acted not in the best interest of (Pendergest-Holt), but were, instead, acting in the best interests of (Stanford chairman) Allen Stanford, and the Stanford Companies and Defendants.”
The suit goes on to allege that the night before Sjoblom met with Pendergest-Holt to prepare her for her SEC testimony, he solicited a multimillion dollar retainer from Stanford’s chairman, a Texas billionaire, to represent him personally. Sjoblom could not be reached for comment.
At one point during Pendergest-Holt’s February testimony, Sjoblom was asked whom he represented by Kevin Edmundson, the assistant regional director in the SEC’s Forth Worth Office.
“Just so we’re clear, Mr. Sjoblom, do you represent the witness here today?” Edmundson asked, according to a court transcript of the testimony.
“I represent the company Stanford Financial Group and affiliated companies,” Sjoblom replied.
Asked SEC branch chief Michael King: “And do you represent anybody else in connection with this matter?”
Sjoblom answered, “I represent the companies, is who I represent.”
Edmundson tried one more time.
“Just so we’re clear,” Edmundson said. “As I understand your statement, you do not, as far as you’re concerned, represent the witness here today?”
Replied Sjoblom, “I represent her insofar as she is an officer or director of one of the Stanford-affiliated companies.”
In quick succession
That situation changed almost immediately after Pendergest-Holt’s testimony. Sjoblom gave notice to the SEC Feb. 11, the day after Pendergest-Holt’s testimony, that his firm was no longer Stanford’s counsel.
He followed that up with a Feb. 12 fax to Edmundson and left a voicemail message for him the next evening.
Sjoblom typed a note on his BlackBerry to Edmundson a little after 4 p.m. Feb. 14 in which Sjoblom said, “I disaffirm all prior oral and written representations made by me and my associates ... to the SEC staff regarding Stanford Financial Group and its affiliates.”
Pendergest-Holt filed her lawsuit this week the day before former employees of her old Stanford office in Memphis – which has been shuttered along with the rest of Stanford’s operation – were allowed back in one last time. Former employees were allowed in from 9 a.m. to 6 p.m. Tuesday to retrieve documents and any other personal belongings they had not removed, according to a schedule from the receiver in charge of examining the company’s finances.
Stanford’s chairman also within the past few days filed an answer to the allegations against him in Texas and asked that his assets be unfrozen so he can hire a lawyer to defend himself.