Supreme Court won’t hear Stanford receiver’s appeal Supreme Court won’t hear Stanford receiver’s appeal Associated Press file photo by DAVID J. PHILLIP -- R. Allen Stanford arrives in custody in August 2010 by bill lodge| firstname.lastname@example.org July 11, 2014 Comments Court-appointed receivers searching for billions of dollars stolen from investors by convicted fraud artists Robert Allen Stanford, of Houston, and Bernard Madoff, of New York, were denied consideration of similar appeals Monday by the U.S. Supreme Court. Both receivers had been told by federal appellate courts that they did not have authority to represent certain bilked investors in specific types of litigation. Dallas attorney Ralph S. Janvey is in charge of the five-year-old receivership searching for between $5 billion and $7 billion Stanford stole from victims in Louisiana and places as distant as Venezuela. Janvey was notified by the Supreme Court that justices will not consider his bid for authority to represent any of the more than 20,000 victims in civil suits against former Stanford employees alleged to have assisted Stanford in his crimes. The 5th U.S. Circuit Court of Appeals had ruled Aug. 30 that Janvey could not represent Stanford victims in lawsuits against former Stanford employees, who wanted claims against them decided in arbitration. Kevin Sadler, lead attorney for Janvey, said Monday his client “is disappointed that the Supreme Court declined to review this appeal.” Sadler said that appeal “raised a very important question about the scope of a court-appointed receiver’s powers to recover funds to compensate victims of frauds like the Stanford Ponzi scheme.” Added Sadler: “Whether the receiver must arbitrate his claims against Stanford insiders is still a matter under consideration by the (U.S. District Court in Dallas), and the issue likely will be reviewed by the 5th U.S. Circuit Court of Appeals, for the third time, in 2015.” Meanwhile, Sadler said, Janvey “will continue to pursue his claims in court against those (others) who profited from, aided and abetted or enabled the Stanford Ponzi scheme.” Thus far, Janvey has recovered less than $300 million for the receivership estate. He has paid himself and his team of attorneys, accountants and investigators more than $60 million, while distributing $30 million to victims and using more than $50 million for team expenses. In a related matter in February, the Supreme Court upheld a 2012 ruling by the 5th Circuit that Stanford victims have the right to file class-action civil suits in state courts against people and firms alleged to have aided Stanford in his fraudulent schemes. Scores of Stanford victims have filed such suits in Baton Rouge. Phillip W. Preis, an attorney for many of the Baton Rouge-area victims, said the Supreme Court’s action on Monday does not affect his clients’ lawsuits in the 19th Judicial District Court. Madoff’s case, like Stanford’s, involved a Ponzi scheme. Such schemes involve few, if any actual investments. Instead, criminals like Madoff and Stanford, pocket and spend much of the money they receive from their customers. Early investors are paid dividends that actually are small amounts of later investors’ money. Word of those fake profits draws in even more investors, and the Ponzi criminals pocket even more cash. Madoff pleaded guilty to felony charges in 2008 and is serving a prison sentence of 150 years. Stanford was convicted at trial in Houston and is serving a term of 110 years. He maintains he is innocent of all charges on which he was convicted. Irving H. Picard, the court-appointed trustee in the liquidation of Madoff’s assets, was denied permission by lower courts to represent Madoff victims in suits against banks alleged to have assisted Madoff’s Ponzi scheme. On Monday, the Supreme Court declined to consider Picard’s appeal of that decision. Picard has estimated that Madoff’s customers were swindled out of $17.5 billion. His team has recovered more than $9.8 billion for victims. But Picard’s team fees and expenses are much larger than Janvey’s — about $850 million.