Stanford asks to unfreeze funds to pay lawyers

NEW YORK Sun Apr 19, 2009 6:59pm EDT

Texan billionaire Allen Stanford talks during an interview in Miami in this May 1, 2008 file photo. REUTERS/Joe Skipper

Texan billionaire Allen Stanford talks during an interview in Miami in this May 1, 2008 file photo.

Credit: Reuters/Joe Skipper

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NEW YORK (Reuters) - Allen Stanford, the Texas financier facing civil charges for a massive fraud, has asked a judge to unfreeze at least $10 million in assets to allow him to pay his defense attorneys, according to court documents filed on Sunday.

In the document, filed with the Dallas federal court, Stanford's lawyers said: "The cost of Allen Stanford's representation in this court and many others through the years it will take to conclude this litigation will almost certainly exceed $20 million."

The lawyers asked for $10 million to be deposited into an escrow account in the name of Houston criminal defense attorney Dick DeGuerin, Stanford's lawyer.

Stanford, three of his companies and two top aides are accused by the U.S. Securities and Exchange Commission of running an $8 billion fraud involving high-yield certificates of deposit.

The SEC has frozen all of Stanford's personal and corporate assets and placed them under the control of Dallas receiver Ralph Janvey.

The court-ordered freeze leaves Stanford "with no money to retain counsel to defend himself from an avalanche of allegations in civil actions not just across the country, but around the world, not to mention a possible criminal indictment," Jack Nickens, Stanford's civil lawyer, said in the filing.

Nickens said the government seized Stanford's assets after former employees told regulators about the fraud, in which early investors were repaid with funds taken from new investors.

Stanford, who denies the allegations, wasn't given a fair chance to respond before everything he had was seized by the government, Nickens said.

(Reporting by Jui Chakravorty Das; Editing by Jan Paschal;

jui.chakravorty@thomsonreuters.com; +1 646 223 6033; Reuters Messaging: jui.chakravorty.reuters.com@reuters.net )

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