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VOL. 124 | NO. 205 | Monday, October 19, 2009


Stanford Legal Team Hints at Need for More Time

By Andy Meek

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Lawyers representing R. Allen Stanford, the jailed Texas financier accused of running a massive Ponzi scheme, say they have their work cut out for them.

Court motions filed over the past few days by Stanford’s lawyers as well as prosecutors who have spent about nine months preparing their case show why. Several million pages of documents have been scanned and uploaded onto a computer database all parties are using as they get ready for a trial.

Crumbling empire

But prosecutors have had a big head start, Stanford’s defense team argues. And they say they’ll need much more time to prepare a defense for their client, a man who as recently as last year claimed a spot on Forbes’ list of the richest Americans.

News accounts of a courtroom hearing last week at which Stanford was present describe him as looking sickly and at one point spitting blood into a cup.

Before his downfall earlier this year, Stanford was known for having built a sprawling business empire that at one time employed a contingent of financial advisers in Memphis. Regulators shut the whole operation down in February.

The company that once seemed to possess the Midas touch was dismantled, offices shuttered and employees laid off. Especially crucial to the criminal case now pending in Texas against Stanford: the seizure of millions of files.

After a criminal indictment was returned against Stanford and some of his subordinates this summer, prosecutors began working with an outside contractor to scan case documents into a database called iConnect. It’s an Internet-based, password-protected program routinely used by law firms and corporate legal departments.

All parties involved in the Stanford case held a conference call at the end of July, during which prosecutors walked through how the software works and gave passwords to attorneys who needed them. A project manager for the software is working with prosecutors, and separate project managers are working with each defendant.

That’s to keep a wall between all sides and prevent one from knowing what the other is doing or looking at.

“As of early October 2009, approximately 1.25 million documents had been scanned into the database,” prosecutors wrote in a filing to the Texas judge where Stanford’s case is pending. “This translates to approximately 4.11 million pages, which is 215 gigabytes (of data).

“Additional documents are currently being processed by the contractor, which estimates that this additional data of approximately 1.5 million pages will be uploaded over the next couple of weeks. … The majority of these documents are e-mails obtained off the Stanford Financial Group server for key Stanford employees.”

Much remains

The mountain of evidence, plus the international scope of Stanford’s former businesses and long list of witnesses who needed to be interviewed, are part of the reason Stanford’s attorneys aren’t ready yet.

“In addition to the 4 million documents that the government will make available, there are potentially several million more that are in the possession of the (Stanford) receiver,” Stanford’s attorneys wrote in a recent court filing.

“These documents have been represented to take up 60 terabytes of storage space, which would equal several million pages of documents.

“The amount of information is so vast that (Stanford receiver Ralph) Janvey and the over 100 lawyers that have been examining this information have charged over $35 million for their work.”

It’s the latest example that much of the preliminary work remains unfinished before Stanford and his ex-employees will face a jury, prolonging a story about the financier and his company that once looked very different to Memphians.

Jim Davis, a college roommate of Stanford’s at Baylor University in Waco, Texas, was the company’s dapper, silver-haired chief financial officer who already has copped a plea deal with prosecutors. He was among several Stanford figures well known in Memphis.

Stanford’s company was a major benefactor of local causes such as St. Jude Children’s Research Hospital. And Davis, who used to fly to Stanford’s Memphis office on a company jet from his home in Mississippi, worked here.

Among the company’s myriad local ties, Davis was on the board of the National Civil Rights Museum and gave the keynote address for the museum’s Freedom Awards ceremony in 2006.

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