David Hittner

Justice Served Up September 14, 2012

English: Mug shot of Allen Stanford. (Photo credit: Wikipedia)

Stanford Financial Chief Investment Officer Gets 3 Years in Prison (Bloomberg) - Talk about the deal of the century for prison time, Laura Pendergest Holt (39) was scheduled to begin defending herself at trial about this time but instead took a plea deal to avoid the same fate of her boss Allen Stanford (serving 110 years in prison). Prosecutors had settled on a take-it-or-leave-it deal for U.S. District Judge David Hittner of 36 months for Holt on the charge of obstructing justice (nothing associated with the Ponzi scheme itself). Even though Hittner agreed to accept the plea and the sentence, he had received a number of letters from victims telling him to reject the deal in an effort to get her more prison time. Holt was not allowed to self-report to prison and was taken into custody. She leaves behind a husband to care for her 16 month old daughter.

Do Ethics Courses Fall Short In Business Schools (Daily Herald) - Perhaps it is a call for business schools to look at doing something different. With large white-collar cases involving graduates of Harvard, Wharton (Penn), Southern Cal and more .... it may be time for a change in the way ethics is taught. Perhaps the answer is that there is a little ethical fading in all of us that we need to be aware of in order to fend off that temptation that is surely coming our way.

10 More Arrested in Long Island Rail Road Disability Fraud (NY Times) - I think this is a fascinating case of usually hard-working people who found an easy way out by claiming they were unable to work ... a kind of self-retirement because "I deserve it!" Ten more people from the LIRR were arrested on Tuesday, bringing to total to 32 being charged for getting a doctor to say they could not work and collected benefits. Perhaps this is a wake up call to the many who cheat on workers compensation claims .... but I doubt it.

CA Woman Steals $550k From Employer Only To Be Scammed Herself (Acorn) - A once loyal employee of Advantek (promotional marketing company) based in California, was caught taking $550k by passing 170 checks to herself over a year's period. When busted, she told why she needed the money ... to bail out her on-line boyfriend from Spain who was said to be held in U.S. Immigration. It turned out, that the boyfriend was a scammer himself who was part of a Nigerian criminal enterprise.

Federal Inmate's Family Gets Settlement For Missed Diagnosis of Cancer (Press & Guide) - The federal prison system does have healthcare for inmates, but here's a story of pure neglect. Timothy Bell was sentenced to a 30 month prison term for a non-violent drug charge. For 18 month, he complained to prison doctors and adminstrators of discomfort he was feeling near the pits of his arms. Finally, after several attempts to get some medical attention, he was transferred to a medical prison where he was diagnosed with stage 4 non-Hodgkin's lymphoma. Bell was released from prison on November 10, 2009, a year later he died at the age of 39. Yesterday, the federal government agreed to pay his family nearly a million dollars as a settlement. So much for government healthcare.

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Laura Pendergest Holt

Stanford Financial Group

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Fraud

Justice Served Up March 6, 2012

Allen Stanford Jury in Deadlock - For 3 days the jury has been deliberating in the trial of accused Ponzi schemer Allen Stanford. The jury sent a note tho Judge David Hittner that they could not reach a verdict. Judge says, "keep on going, this trial is as good as you're going to get."

Sam Antar Speaks Out and Attendee Let's Him Have It on Evaluation - Sam Antar, convicted felon and prominent white-collar speaker on the circuit, gave a presentation in Philadelphia last fall. One of the audience members gave an "anonymous" evaluation that called Antar "A piece of shit". The man making the comment was subsequently fired and guess who has come to his defense to have him reinstated? Sam Antar! Interesting perspective.

Chris Tappin, U.K. Citizen, Denied Bail - The saga continues over U.K. citizen Chris Tappin who was extradited from the U.K., a bit over a week ago, to stand trial in the U.S. on charges that he attempted to send military-grade batteries to Iran. Denying bail leaves Tappin in solitary confinement in a U.S. jail awaiting trial. The U.K. is concerned about the extradition of its citizens to stand trial in the U.S.

Misdemeanor Drug Charges have Big Impact on Former Boeing Employees - People who were caught up in the sale of presciption drug scandal involving employees at a Boeing helicopter plant near Philadelphia, are suffering some serious consequences for their actions. Should they have been treated as criminals, or people with a drug habit who needed help? They lost their job, now many are losing their homes.

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Justice Served Up March 1, 2012

The Jury Starts Deliberation in Allen Stanford Trial - After nearly 6 weeks of trial, and Allen Stanford NOT taking the stand, federal judge David Hittner, gave instructions to the jury to determine the fate of Stanford who is accused of a multi-billion dollar Ponzi scheme. Prosecutor William Stellmanch said in his closing statements of Stanford, "For him [Stanford], the bank was his ATM". Ali Fazel, Stanford's attorney claimed, "Just because you're indicted with something doesn't mean you're guilty." We'll see.

Will There Be Criminal Charges at MF Global - Unlike other white-collar crimes, the people at the middle of bad decisions at MF Global were some smart folks, many that either were lawyers or had access to lawyers at the final minutes of the meltdown of the firm. DealBook did a good job of putting together some possible ways criminal charges could go down.

Canada Sturggles With Inmate Costs of $112,000/inmate - Now this is in Canadian dollars but still this is high. Once component driving these costs is healthcare. For those wondering about costs in the U.S., it has been estimated that it costs about $45,000 to house an inmate in the U.S. Maybe they have nicer prisons up north, eh?

Big Healthcare Fraud Bust in New York - Just a day after we found out about the largest healthcare fraud in history ($358 billion) in Texas, New York busted another one....but this one was "only" $279 billion! Over half a trillion in fraud this week....nice work. Whereas the Texas case concerned Medicaid and Medicare, this one related to rip-offs of private insurers who provided auto insurance. In all, 36 were arrested, of which 10 were licensed physicians and 3 practicing attorneys.

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Justice Served Up February 27, 2012

Here is what is hot today in news:

Gulf Oil Spill Trial Delayed - BP, based in London, UK, was set to defend itself on, or limit the liability of, civil penalties associated with the oil spill in the Gulf of Mexico in 2010. The trial has been delayed a week, but news is that BP is close to a settlement to close its $20 billion Gulf Coast Claims Facility and move the remaining $14 billion to plaintiffs who contend the spill harmed their businesses and properties. To date, BP has paid $6 billion in claims. This settlement would be separate from BP's talks on fines with the U.S. government....those negotiations continue.

Allen Stanford's Defense Team's Expert Accountants Unpaid Bills - Marcum, a large New York based accounting and advisory firm, is on the hook for over $3.2 million for adding in the defense of Allen Stanford during a trial that has now lasted 5 weeks. The U.S. government is paying the legal fees of Stanford since he claims he has no financial means to defend himself. Judge David Hittner, the presiding judge, had approved the $3.2 million budget for the services of Marcum but the final say on what the firm will be paid falls to U.S. Appeals Court Judge Edith Jones, who also oversees the budgets of federal courts for the district where Stanford's trial is taking place. To date, Marcum has been paid $600,000, and there is no assurance it will be paid another dime. Could the defense use this as a strategy for appeal?

MF Global's Missing Money - There is some focus on a few transactions at the center of the missing money ($1.6 billion) in MF Global money. Those transactions took place in the final hours before MF Global claimed bankruptcy. The person whose name keeps coming up is Edith O'Brien, a senior official at MF Global's Chicago office and the person named in congressional testimony by Jon Corzine as someone responsible for many of the last minute transactions conducted by MF Global. As the detective works continue, there is also a story brewing about who gets paid first with the remaining assets of the company, creditors (hedge funds who bought up steeply discounted MF Global bonds), or customers who have lost a significant amount of their personal wealth?

Olympus Names New President - After being hit with a major accounting scandal that was uncovered by former CEO, Michael Woodford, Olympus is putting its house back in order by naming a new president, Hiroyuki Sasa, the head of its medical equipment marketing business. The move will likely not help investor confidence that Olympus is serious about reform as many had called for someone outside the company to come in to turn things around.

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Allen Stanford Trial Moving Along....SLOWLY

Image via Wikipedia

The trial of Allen Stanford, Stanford Financial Group, is expected to start January 23rd in Houston, TX. Stanford, who was arrested for running a $7 billion Ponzi scheme, has been in prison since June 2009. Dispite not having a trial, all of his assets have been seized and he has no money for a defense....so the U.S. government has picked up the tab. Hard to believe that Forbes had ranked him as the 205th richest person in the U.S. the year prior to his arrest (2008).

Three things have held up this trial. The first was a physical attack by a fellow inmate on Stanford when he was first incarcerated. The injuries were severe, to the head, causing Stanford to undergo treatment. Once Stanford started treatments, he also developed memory loss and then had an addiction to anti-depressants. He was then transferred from his prison in Houston to the Bureau of Prison's facility in Butner, NC to receive advanced medical treatment. Late last year, he was deemed "cured" and routed back to Houston for trial. However, Stanford said he still wasn't feeling well and suffered from memory loss....something that would hinder a good defense at trial. So his defense team asked that the trial be put off. However, on December 22, Judge David Hittner determined that Stanford was faking his symptoms and was competent for trial....so we were off for the trial....oh, wait, there is another problem.

Allen Stanford's defense team, you know the one being paid for by U.S. tax payers, had a set back in that their experts that were to testify in Stanford's defense had not been paid. Yes, expert defense witnesses can be paid for their services....kind of like tying a pork chop around your neck to make the dogs play with you. With this, Stanford's attorneys sought yet another delay until the experts could be paid....those experts had already quit as a result of non-payment. Money was released this week and all the experts are ready to defend Mr. Stanford. So now we're ready to go, right? Not quite.

Stanford's lead defense counsel, Ali Fazel, wanted a delay of trial three more months to prepare more for the trial. It seemed Fazel and his team have spent all their time trying to declare their client incompetent and keeping the defense team paid, that they needed more time to actually prepare to DEFEND their client. Judge Hittner had heard enough and told the defense team to get ready for January 23rd. In his ruling Hittner said, "Stanford, as an indigent defendant, is entitled to a solid, capable and competent defense, not the deluxe or 'perfect' defense that he might have otherwise desired were he still in control of the millions (or even billions) of dollars indicative of his past lifestyle." On with the trial !!!!