(Updates with freezing of funds in second paragraph.)
June 17 (Bloomberg) -- R. Allen Stanford’s court-appointed receiver sued the Libyan government wealth fund for $55 million he claims the state withdrew from Stanford’s alleged Ponzi scheme before it collapsed in early 2009, according to the receiver’s lawyer.
Ralph S. Janvey, Stanford’s receiver, also won a temporary freeze on some Libyan government bank accounts in the U.S. until a federal judge can determine if the money should be distributed to investors allegedly swindled of more than $7 billion, said Janvey’s lead attorney, Kevin M. Sadler.
“The payments made to the Libyan defendants were fraudulent transfers, using funds which Stanford obtained by fraud from investors who purchased Stanford’s phony CDs even as the Ponzi scheme was beginning to collapse,’’ Sadler said today by e-mail.
Janvey’s suit was filed under seal June 3 in U.S. District Court in Dallas, Sadler said. The lawsuit couldn’t be independently confirmed using the court’s electronic docket.
Stanford, 61, denies all allegations of wrongdoing. He previously said he met with Libyan sovereign-wealth fund officials shortly before the U.S. Securities and Exchange Commission seized his operations on suspicion of fraud in February 2009.
The Libyans withdrew $12 million of their Stanford investment immediately after this meeting, which occurred in Libya “just three weeks before the SEC filed suit,’’ Sadler said in today’s e-mail.
Order to Freeze
Janvey obtained a court order on June 6 freezing $55 million in Libyan assets in U.S. bank accounts, pending a December hearing before U.S. District Judge David Godbey, Sadler said. The judge oversees the SEC’s case against Stanford and several of his companies.
Stanford faces 14 criminal charges that he deceived investors about the safety and oversight of certificates of deposit sold by his Antigua-based Stanford International Bank Ltd. He is in a prison hospital unit in Butner, North Carolina, until he completes rehabilitation from a prescription-drug dependency he acquired in jail.
The former billionaire has been in custody as a flight risk since his indictment in June 2009. His attorneys have asked for a delay in his criminal trial, now scheduled for September in Houston federal court, until he is found competent to assist in his defense.
The criminal case is U.S. v. Stanford, 09-cr-342, U.S. District Court, Southern District of Texas (Houston). The SEC case is Securities and Exchange Commission v. Stanford International Bank, 09-cv-298, U.S. District Court, Northern District of Texas (Dallas).
--Editors: Charles Carter, Glenn Holdcraft
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