By Patsy R. Brumfield / Daily Journal
HOUSTON, Texas – I’m here in the 8th floor courtroom where the Stanford trial action resumes at 10 a.m. Thought I’d bring you some notes and other things before I’m back typing James Davis’ testimony, etc.
• Just met a charming older man, Fabio, who’s been here for most of the trial. He says he worked with Davis and Stanford during the early 2000s and understands completely why NEMS reads want to track what’s happening.
• Yesterday, Davis said Stanford International Bank Ltd., thru which the CDs were sold, was 30-45 days from drying up, cash-wise, in early 2009. That’s when Allen Stanford came up with the idea, he says, to inflate a $63.5M real estate holding into a $1billion “infusion” by Stanford into the bank.
Of course, he said, it was all on paper and never happened.
• If you read my story today in the Daily Journal, you’ll see that Davis admitted to cheating on his first wife with his second wife, whom he met when she was 17 and was their babysitter. Then he admitted to an affair with Baldwyn native Laura Pendergest-Holt, who became Stanford chief investment officer.
Then, he admitted to cheating on Laura with her cousin, then with his administrative assistant, but he utterly denied committing adultery with some kind of investment consultant with a Swedish kind of surname.
Hard to say if the jury will give all this much weight, in addition to Davis’ admissions he was a coward, a cheater, a swindler, a fraudster, a liar.
Ugh, I’m sure the government cringed but knew it was coming. Likely they’ll attempt to shore all this up when they get to re-direct after the defense is done initially.
• Stanford decided to open the U.S. brokerage business in 1995, starting in Baton Rouge. When he felt like sales weren’t high enough, he fired the first two co-presidents and hired Davis’ nephew-in-law, Danny Bogard, to run it.
Davis said DB was totally qualified after running North and South American operations for a telecommunications firm.
• Stanford came up with the Top Producers Club incentive program to energize the sales staff and make it worth their while to perform, with bonuses etc. Davis described their TPC meetings as ” Extravaganza, Hollywood, lot of sizzle, excitement. skits, videos, special speakers.”
• Davis said Stanford suggested hiring Davis’ son, Zach, to succeed him with the company, but Davis insisted his son would never allow the fraudulent behavior. “Absolutely not,” Davis said he told him.
• Davis said in January 2009, just months before their financial world exploded with SEC accusations in federal court, the general counsel Mr. Alvarado told him, He said “Jim, this is serious shit. You’ve got to get Mr. Stanford engaged. We have to have a meeting. They have subpoenaed you and Mr. Stanford.”
• Before Stanford came to the Stanford high-ups meeting in Miami in January 2009, Davis said he told him, “He said that he had his head out of his ass and that he was now ready to come to the meeting, he would fly to Miami and lead us out of the wilderness.”
• After Davis made public to this high-ups group some details about the contents-secret Tier 3 assets, which Stanford used, he said, Stanford said to him, “You melted.”
• Davis said, on the even of the bank’s collapse, he asked Stanford to am $880 million loan to pay expenses for his Baldwyn real estate investments. He also said he was 50/50 with Holt on the downtown Baldwyn coffeeshop.
Ultimately, he got $990 million, which the defense questions if Stanford approved or Davis just withdrew because he knew how.
• DAvis said he’s been living in Michigan and working for a fruit farm. He said he’s living on social security “and a small pension.” Across the years for Stanford, he said he was paid total $14 million and in the end was paid $2 million in salary and bonuses.
• Davis said he borrowed money from his mother-in-law to pay for a private attorney soon after he realized his legal jeopardy. Now, his attorney has public defender status and is being paid by the taxpayers. Davis said all his assets were seized by the court-appointed receiver.
• He still hasn’t filed his 2008 and 2009 income tax reports, DAvis said, because he doesn’t have any records to do so, with them in the receiver’s possession.
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