Securities fraud defendant Stanford found incompetent for trial

A U.S. District Court judge in Houston has found financier Allen Stanford incompetent to stand trial. Stanford, who is accused of committing a $7 billion securities fraud, sustained a serious brain injury when he was attacked by an inmate during his pre-trial detention. Since then, he has been over-medicated to the point of addiction and is suffering from diminished mental capacity.

Stanford was indicted in 2009 on 21 counts of securities fraud and money laundering. Prosecutors claim that he created false accounting records, lied to investors and bribed a regulatory official in Antigua in order to operate a massive investor and bank fraud.

Prison violence may be cause of delay in federal white collar crime prosecution

Stanford was denied bond in advance of his federal fraud trial and was sent to the Joe Corley Detention Facility in Conroe, Texas, a private prison facility.

In September 2009, he was sitting in a chair talking on the phone when another inmate grabbed him from behind, causing him to fall, hit his head on a concrete floor and lose consciousness. While he was unconscious, he was severely beaten around the head, which resulted in fractures to his face, eye sockets and nose, which required reconstructive surgery. He also suffered nerve damage.

Stanford was then transferred to another facility, which was operated by the Federal Bureau of Prisons. While there, he coughed up blood and passed blood in his stool. He also lost 40 pounds in 90 days.

At Stanford’s January 6 competency hearing, three psychiatrists — including the one brought in by the government — testified that Stanford suffered from diminished mental capacity and was not competent to effectively assist his defense.

Although the cause of his diminished capacity is not certain, doctors said it could be brain damage from the head injury, profound depression, or over-medication which has led to a prescription drug addiction. All three psychiatrists recommended Stanford be weaned from the medications.

Nevertheless, the U.S. Attorney argued that Stanford is legally competent. However, they did ask the court to move him to a suitable facility for further psychiatric evaluation.

The judge denied a request by Stanford’s criminal defense attorneys that he be allowed to seek treatment at a private facility in Houston. He will be sent instead to a Bureau of Prisons medical facility for treatment and eventual reexamination for competency.