The prosecution rested its case after 3 and half weeks of presenting Allen Stanford as the leader of a massive, multi-billion dollar Ponzi scheme.
The week started with Lula Rodriguez, a former Stanford Financial employee who was in charge of public relations (talk about a tough job). She joined Stanford in March 2008, and her testimony revealed that the job never got any better as it progressed. When the Madoff Ponzi scheme was revealed, she said there was a sense of fear within Stanford Financial that clients woudl pull their investments in response. Rodriquez's job was to develop talking points for investors and others who inquired about Stanford's operations. Allen Stanford did not make her job easy. Rodriquez said she learned that Mr. Stanford had a $20 million sponsorship of a cricket tournament only after he scheduled a news conference to talk about it. Where did the money come from for this? Rodriguez said she had no idea and Mr. Stanford was less than forthcoming.
Another witness, FBI Agent Robert Martin, took the stand as one of the last witnesses the government called prior to resting its case. Martin is a banking (fraud) expert and his job was to track the money. "All of it [money] was going into his 100% owned companies, his possessions, his expenditures," Martin said in his testimony. Martin's analysis was that there was a $7 billion "hole" between the bank's actual and reported assets at the time regulators seized Stanford's operations on suspiciion of fraud in February 2009. His story matched the testimony of CFO James Davis and Antigua banking regulators. Even the "legitimate" businesses of Mr. Stanford's ran into problems. Two Caribbean airlines that he owned went through $33 million before shutting down. Unfortunately for investors, they never wanted or knew that their investment was in any airline.
As the defense started to present its case, it gave a list of 26 potential witnesses that it "might" call. Missing from that list was Allen Stanford, who the defense team said would testify. They can still call him to the stand but right now it does not look like they will. Their first witness was Joan Stack, who headed global human resources for Stanford Financial from 2007-2009. Stack testified that Mr. Stanford was missing during critical times when investors wanted to hear from him and that James Davis, Stanford Financial's CFO, was the guy calling the shots. Davis has pled guilty and was the star witness for the prosecution. His testimony was that he was a puppet for Stanford....nobody wants to be the one in charge of an alleged Ponzi scheme.
Chances are that this trial is coming to a quick end within the next week. Mr. Stanford's best defense may be that he is not fit to be prosecuted because he does not understand where he is (reference earlier defense strategy to have case delayed because of Stanford's mental state as a result of a prison beating). Allen's own rambling testimony may be his best defense. I think it is hard to defend that a CEO did not know what was going on inside of his own company. It did not work for the CEO's of Enron (Ken Lay) and WorldCom (Bernie Ebbers)....it won't work for Stanford, and nobody has called the company legitimate yet...not even the first defense witness.