HOUSTON (Reuters) - Former billionaire Allen Stanford was sentenced to 110 years in prison on Thursday for running a $7 billion scheme in which he stole money from his investors to finance an extravagant lifestyle in the Caribbean.
U.S. District Judge David Hittner said Stanford’s actions were among the most “egregious criminal frauds,” and investors who lost money said Stanford’s crimes were worse than those of Bernard Madoff, another Ponzi schemer.
In March, a jury convicted Stanford of 13 charges including fraud and conspiracy for selling certificates of deposit from his bank in Antigua to thousands of investors in the United States and Latin America. He had already spent some of those proceeds on yachts, girlfriends, sponsorship of a cricket tournament and other accoutrements of a high-rolling life.
Stanford denied committing fraud or running a Ponzi scheme and, in a statement that went on for 40 minutes, he blamed the U.S. government for ruining a business he said had enough assets to repay its depositors. “They destroyed it and turned it to nothing,” he said.
Stanford insisted: “I am not a thief.”
Prosecutor William Stellmach told the judge: “This is a man utterly without remorse. He treated his victims like roadkill.”
One of the victims, Angela Shaw, said Stanford preyed on retired teachers, veterans and refinery workers - unlike Madoff, who targeted the wealthy.
“He stole more than millions. He stole our lives as we knew them,” Shaw said.
Madoff pleaded guilty in March 2009 to running a Ponzi scheme and is serving a 150-year sentence. A third major Ponzi schemer, Minnesota businessman Tom Petters, is serving a 50-year prison term for a $3.65 billion scheme.
Attorneys who have followed the Stanford case said the judge was justified in handing him such a long sentence.
“The number can easily be justified by the size of the money involved in the fraud, the lack of remorse, no acceptance of responsibility, impact on the victims and financial institutions,” said Wendell Odom, a Houston-based attorney. “But when you think about 110 years and know that is a life sentence, it is very sobering.”
Philip Hilder, a former federal prosecutor and criminal defense attorney in Houston, said Hittner likely just followed the federal sentencing guidelines.
“While it is exorbitant, the judge sentenced to what the guidelines called for,” Hilder said.
During a six-week trial earlier this year, jurors heard how Stanford International Bank in Antigua issued certificates of deposit with above market interest rates that were peddled by an army of highly incentivized brokers. Customers in the United States and Latin America were promised a safe, highly liquid investment, but Stanford invested the money in real estate, and private equity companies.
He also spent the funds building a lavish lifestyle for himself and his estranged wife, children and girlfriends. He owned yachts, mansions in Florida and the Caribbean and spent millions of dollars promoting the sport of cricket by sponsoring international tournaments from his base on Antigua.
In a memo to the court last week, prosecutors said Stanford used the firm’s private jets to fly a tailor from Bergdorf Goodman in New York to Antigua to take his measurements and to fly in koi for his pond on the island of St. Croix, prosecutors said.
Hittner told the packed hearing that he had personally read each one of the 350 letters written by defrauded investors detailing the impact on their lives.
“I owed it to each writer to consider them,” the judge said.
Defense attorney Ali Fazel told reporters he was worried the judge would give Stanford, 62, the full 230 years sought by prosecutors, but nonetheless described the sentence as harsh. “It will be tough on him,” said Fazel, adding that the sentence would be appealed.
Stanford’s attorneys had asked for a sentence of about three years, the same amount of time he has been in federal custody.
Stanford will remain in a federal detention center in Houston for the next 30 to 60 days while the Bureau of Prisons decides where he will serve his sentence.
After court adjourned, Stanford’s mother, Sammi Stanford, said she had been prepared for a sentence that will keep her son in prison for the rest of his life. “I didn’t expect anything different.”
Reporting by Anna Driver and Eileen O'Grady; editing by Gunna Dickson