By Bill Lodge
Advocate staff writer
October 24, 2012
Campaign contributions totaling $1.6 million and steered to Democratic Party and Republican Party election committees years ago by since-convicted swindler Robert Allen Stanford must be returned to a receiver’s fund for victims, an appellate panel ruled Tuesday.
Stanford was convicted this year on charges that he led a scheme that defrauded more than 20,000 investors worldwide of more than $7 billion. Approximately $1 billion of those losses were suffered by residents of the Baton Rouge, Lafayette and Covington areas, according to estimates by Baton Rouge attorney Phillip W. Preis and state Sen. Bodi White, R-Central.
Dallas attorney Ralph Janvey, court-appointed receiver for any Stanford assets that can be recovered, filed suit in February 2009 for recovery of campaign contributions made to Republican and Democratic election committees between 2000 and 2008. And U.S. District Judge David Godbey, of Dallas, ruled in favor of Janvey’s demands for return of the $1.6 million.
The Democratic Senatorial Campaign Committee, Democratic Congressional Campaign Committee, Republican National Committee, National Republican Senatorial Committee and National Republican Congressional Committee sought reversal of Godbey’s decision.
But a three-judge panel of the 5th U.S. Circuit Court of Appeals in New Orleans ruled Tuesday that the $1.6 million must be paid into Janvey’s receivership for the benefit of Stanford’s victims.
That decision was made by Circuit Judges James L. Dennis, of New Orleans; E. Grady Jolly, of Jackson, Miss.; and Fortunato P. Benavides, of Austin, Texas.
The two Democratic committees received a combined total of $1.15 million that belonged to Stanford investors, the panel ruled. The three Republican committees received a combined total of $450,345.
Dennis, Jolly and Benavides concluded that Godbey correctly ruled that Janvey demonstrated that Stanford “gave contributions to the committees with actual intent to defraud” his investors.
The five committees argued that Janvey waited too long to file suit over political contributions that were made in 2008 and earlier years.
The appellate judges noted, however, that Janvey demanded return of the $1.6 million on Feb. 19, 2009, just three days after he was appointed receiver for Stanford assets.
“The committees’ argument misses the mark,” the appellate judges added. “Even if the existence of the donations was discoverable (immediately), their fraudulent nature was not.”
Stanford is serving a prison term of 110 years.