END OF DAY: Davis admits affair with Holt, says Stanford believed she would be 'loyal'

By Patsy R. Brumfield / Daily Journal


HOUSTON, Texas – James DAvis said he had an affair with Baldwyn native Laura Pendergest-Holt from 2001 to 2003, and that their boss, Allen Stanford thought it was a good thing.
“She will be loyal,” Davis said Stanford told him about his belief she would go along with their fraud of financial hocus-pocus at Stanford International Bank Ltd.
Davis also said his son, Zach, was hired to work in the Memphis office as an analyst, and Stanford spoke about making him his father’s replacement in the multi-billion-scheme.
“Absolutely not!” Davis said he told him.
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3:45: (Full testimony under Stanford Trial News icon)

HOUSTON, Texas – James Davis said Allen Stanford loaned the Antiguan government $40 million and it was never repaid.
Davis spoke about how Stanford decided to move Guardian bank in Montserrat to nearby Antigua before it was shut down there. He said the Montserrat government discovered Stanford’s bankruptcy history.
The former Stanford Financial Group chief financial officer also confirmed a story that Stanford held a “blood oath” ceremony with new regulator Leroy King and his assistant in the night to become blood brothers.
The men allegedly agreed to look the other way as Stanford expanded his financial empire there.

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12:55 P.m. (For full testimony, click icon Stanford Trial News)
HOUSTON, Texas – James Davis, who said he graduated from high school in Baldwyn, told jurors Allen Stanford ruled his empire by fear and flattery.
He also said his former Baylor roommate once yelled at him for changing the office layout and didn’t speak to him again for three months.
Davis is the government’s biggest witness to date in the trial against Stanford, charged with a $7.2 billion Ponzi scheme on investors.
Trial began Jan. 23.
At the very outset of his testimony, Davis said he lied about Stanford International Bank’s investment products. He looked thin and spoke weakly as he admitted his guilty plea and possible 30 years in prison.
(Come back for updates or go to Stanford Trial News icon for rolling updates)
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11:00 – Key government witness James M. Davis’ attorney, David Finn, came into the Allen STanford trial, fueling speculation that his client is here to testify soon.
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HOUSTON, Texas – James M. Davis, the government’s key witness against fallen financier R. Allen Stanford, may be on the stand today, federal courthouse chatter says this morning.

Davis, who once lived and visited west of Baldwyn, was his college roommate’s chief financial officer throughout much of the empire’s modern history. He also started out as controller of Stanford’s banks.

Stanford, 61, is accused of operating a $7.2 billion Ponzi scheme on investors in certificates of deposit bought through Stanford International Bank Ltd. on the Caribbean island of Antigua.

It all came crashing down in 2009 when the U.S. Securities and Exchange Commission accused him and others of fraud.

Stanford insists he was not to blame for the financial collapse – that Davis was the one tinkering daily with the money and that investors were doing fine until the SEC scared them into rushing SIBL for early withdrawals of their investments.

However, government witnesses thus far have painted another picture, of massive spending from bank loans that investors were not told about. They also detailed multi-million-dollar construction projects in Antigua and other enterprises Stanford Financial Group, the corporate umbrella, supported with the mega-loans from the bank.

Davis also was accused in the scheme but pleaded guilty in August 2009. He also is expected to testify in the June trial of Baldwyn native Laura Pendergest-Holt and two others charged similarly.

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