Bloomberg News

Allen Stanford’s Criminal Fraud Trial Delayed Until January

June 21, 2011

(Updates with doctors’ outlook in second paragraph.)

June 21 (Bloomberg) -- Indicted financier R. Allen Stanford’s criminal trial was postponed to January from September so he can complete rehabilitation treatment for dependence on anti-anxiety drugs prescribed by prison doctors.

U.S. District Judge David Hittner in Houston said doctors treating Stanford said that it will take him as long as four more months to kick his dependence on anti-anxiety drugs prescribed after he was severely beaten by another inmate in September 2009.

Hittner found Stanford incompetent to assist in his own defense in January after three psychiatrists testified the former billionaire’s mental capacities were diminished from over-medication and lingering head injuries suffered in the prison fight.

Stanford was moved in February from a Houston jail to the federal medical center at the Butner, North Carolina, prison complex, on the expectation his rehabilitation would take as long as four months. Last month, Hittner scheduled the Stanford Group Co. founder for trial in September based on his expected return to Houston this month.

“However, the court now finds it has no alternative but to grant FMC’s request for an additional four months to continue treating Stanford,’’ Hittner said in a ruling handed down today. “Assuming FMC needs the entire four months to treat Stanford, the court now sets Stanford’s jury trial to commence January 2012.’’

Hittner said if Stanford recovers more quickly and returns to Houston sooner than expected, his trial may be moved up again.

Stanford Denies Wrongdoing

Stanford, 61, denies all wrongdoing in connection with civil and criminal allegations he defrauded investors of more than $7 billion through allegedly bogus certificates of deposit issued by Antigua-based Stanford International Bank Ltd.

Stanford has been incarcerated as a flight risk since his indictment and arrest in June 2009.

Ali Fazel, a lawyer for Stanford, declined to comment on today’s order, citing a ruling by Hittner barring lawyers from publicly discussing the case.

Laura Sweeney, a spokeswoman for the Justice Department, also declined to comment, citing the judge’s gag order.

The criminal case is U.S. v. Stanford, 09cr342, U.S. District Court, Southern District of Texas (Houston). The SEC case is Securities and Exchange Commission v. Stanford International Bank, 09cv298, U.S. District Court, Northern District of Texas (Dallas).

--Editors: Peter Blumberg, Michael Hytha

To contact the reporters on this story: Laurel Brubaker Calkins in Houston at laurel@calkins.us.com; Andrew M. Harris in Chicago at aharris16@bloomberg.net.

To contact the editor responsible for this story: Michael Hytha in San Francisco at mhytha@bloomberg.net.


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