LOS ANGELES A U.S. judge on Tuesday approved the sale of real estate owned by corporations controlled by alleged swindler Allen Stanford.
Receiver Ralph Janvey, who is charged with recovering assets for Stanford investors, had asked the court to allow CB Richard Ellis to publicly auction the dozens of parcels of properties in the continental United States and U.S. Virgin Islands "in an efficient and cost-effective manner."
"Marketing efforts will begin immediately," Janvey said in a statement. "However, the timing of any sale will necessarily depend on ... relevant market conditions and debt obligations associated with each property."
U.S. District Judge David Godbey approved Janvey's plan but ordered him to notify the Stanford Condominium Owner's Association if he tries to sell property owned by the Stanford Development Corp, and give residents a chance to object.
Stanford, his former chief investment officer Laura Holt and former accounting executives Gilbert Lopez and Mark Kuhrt and an Antiguan regulator, face criminal and civil charges for defrauding investors in a $7 billion Ponzi scheme involving certificates of deposit.
Stanford, 59, is in jail awaiting a January 2011 trial. Stanford, Holt, Kuhrt and Lopez have denied any wrongdoing.
Although Stanford has yet to be tried, the court "has found good cause to believe that defendants violated federal securities laws," according to court documents.
The procedures call for the receiver to select a "stalking horse bidder" to set the floor for the public auction price, and to pay a break-up fee of 3 percent should that bidder not prevail, court documents showed.
Competing offers are to be submitted to the receiver at least five days prior to the auction, the documents showed.
Janvey will post a notice of the proposed sales on its website, here, and in at least one local newspaper for at least four weeks prior to the sale, the order said.
The properties to be auctioned are located in various counties in Texas, Michigan, Tennessee, North Carolina, and Mississippi and in the U.S. Virgin Islands.
Janvey also was granted permission to dispose of certain parcels through private sales, the court order showed.
The case is Securities and Exchange Commission v. Stanford International Bank, Case No. 3-09-CV-0298, U.S. District Court for the Northern District of Texas, Dallas. (Reporting by Gina Keating in Los Angeles; Editing Bernard Orr)