TUPELO – Seventy-five-year-old Burl L. “Walt” Walton has gone back to work after his entire retirement was lost in the crash of the Stanford Financial Group scandal.
Walton of Tupelo, who again secures used cars for area sales lots, recently filed what is believed to be the first Lee County lawsuit against a Stanford official. He seeks to regain his $430,183.09 and unspecified punitive damages.
In an 11-page legal allegation, Walton accuses former Stanford financial planner Neal Clement of Saltillo of knowingly deceiving him when, in January, he asked Clement to sell his Stanford International Bank certificates of deposit. Walton asked that the sale proceeds be transferred to an existing Pershing LLC account.
“Clement stated that was ‘a good idea,’” the lawsuit states. “At no time during the conversation did Defendant Clement ever advise Walt that Pershing had stopped processing wire transfers from Stanford.”
The lawsuit represents only the plaintiff’s side of the story. Clement could not be reached for comment, and attempts Monday to contact his Jackson attorneys were unsuccessful.
Walton’s legal action insists Clement should have known about Stanford’s financial problems, but never told him, despite their five-year investment relationship.
In February, the U.S. Securities & Exchange Commission sued Stanford’s top executives, including founder Allen Stanford, accusing them of engineering a massive fraud totaling about $7 billion. Assets were placed into receivership and frozen.
The SEC insisted Stanford and the others claimed their CD yields were safe and higher than other U.S. banks’ CDs because of SIB’s offshore tax advantages and favorable international investments.
Walton claims Clement reassured him about the investment’s safety by telling him he had invested $8 million from his own father. But later Clement apparently withdrew his father’s investment from the CDs, according to the lawsuit.
Walton says Clement told him that after the receiver gained control, any request prior to Feb. 6, would be honored and that his funds were being transferred to his Pershing account.
These assurances were false, states the lawsuit filed in Lee County Chancery Court.
While the receiver prohibited certain lawsuits against Clement and other SFG advisers reimbursed by commissions and compensations earned by the alleged fraud, Walton’s lawsuit – filed by Tupelo attorney Claude Clayton – insists Walton isn’t seeking any assets related to those payments.
“The false and misleading representations and omissions by Defendant Clement were made for the purpose of inducing the plaintiff to purchase and/or not sell or cash-out securities from Stanford,” the lawsuit states.
“The plaintiff … believed them to be true.”
Contact Patsy R. Brumfield at (662) 678-1596 or firstname.lastname@example.org.
Patsy R. Brumfield/NEMS Daily Journal