By Patsy R. Brumfield/NEMS Daily Journal
HOUSTON, Texas – The trial of Allen Stanford, which will feature key testimony this week from former Northeast Mississippi resident James Davis, began last Monday with selection of a 15-member jury, including three alternates.
Reports say they’ve varied from closely attentive to dozing at times during testimony.
Stanford faces 14 criminal charges, including mail and wire fraud, relating to the collapse of his financial empire and billions of dollars in investor losses. Davis, who was his chief financial officer, pleaded guilty in 2009 for his role in the alleged scam and is now a government witness.
Last week after opening statements by both sides, five witnesses answered questions from lawyers. They were:
* Michelle Chambliess, a former Stanford employee. She said Stanford used her securities license to open the first Stanford Group Co. office to sell certificates of deposit for his offshore bank, Stanford International Bank Ltd. She also said she was fired when her sales dropped off.
She testified that she was told the bank offshore was to avoid federal taxes and to avoid rules for keeping certain levels of reserves on hand.
* Leo Mejia, hired to be president of Stanford’s Idea advertising company. On a trip to take photos of Stanford’s first bank, Guardian Bank in Montserrat, he said he was puzzled with only a few people working there and unplugged computers. On cross-examination, he failed to recognize a photo of that bank and admitted he lied about his education.
He testified that he became uneasy working for the financier because he lost confidence in the accuracy of financial information he was given to include in advertising materials.
After Hurricane Hugo, Guardian was moved to nearby Antigua and its name became Stanford International Bank Ltd.
* Jason Green, former Stanford financial adviser from Baton Rouge, who talked about CD sales and operations. Green said he made sure his clients understood agreements. He tried to say customers lost money after Stanford put hold in withdrawals, but the defense insists it was after the government announced its investigation. Green said he knows someone who lost $27M.
* Joseph James Flynn, 69, of Winter Park, Fla., a former architect, Marine from Vietnam, who retired in 2005 from war-related health problems. He said he was told his CD deposits were covered by Lloyds of London and invested $1.6 million or 90 percent of his life savings. He said he never doubted his financial officer.
* Mark Collinsworth, ex-financial adviser in Stanford’s Memphis and worked with Holt. He validated various financial documents Friday.
Reports say Collinsworth will continue on the stand today, with Antiguan bank regulator Althea Crick to follow.
Stanford is expected to testify in the trial, although his attorneys continue to claim he is not altogether mentally well since a jailhouse beating and subsequent addiction to painkillers. He spent months in a federal medical facility being weaned off the drugs and last December was declared competent by this trial’s presiding judge, David Hittner.
He’s been in jail since soon after his June 2009 arrest, an alleged flight risk.
Authorities say Stanford sank investors’ money in a variety of his own businesses, including two airlines, and that he used up to $2 billion of investors’ money as personal loans to buy homes and yachts and fund cricket matches.
Stanford’s attorneys contend he was a savvy businessman whose financial empire was legitimate and who never failed to pay what was owed to investors.
Stanford’s elderly mother reportedly was in the courtroom twice last week, as well as a woman who says she’s his girlfriend.
Electronic reporting has a hallmark of coverage of the trial, with reporters using Twitter to send out 144-character news events aggregating under the #stanfordtrial hashtag, which is the website’s way of sorting all similar reports so users can find them all in the same place.
However, Hittner banned tweets by anyone but reporters. Government and defense lawyers are under a gag order, which prevents them from speaking with media or commenting electronically about the trial.