Allen Stanford ‘Not Credible’ on Amnesia Claim

R. Allen Stanford, charged with leading a $7 billion investment fraud, may be faking amnesia and should be tried in January as scheduled, prosecutors said, citing a prison medical evaluation.

Stanford’s scores on medical and neuropsychological tests “were sufficiently low as to evidence that he either was not trying or was faking,” Assistant U.S. Attorney Gregg Costa said, citing a doctor’s report. The prosecutor, in the proposed court order filed yesterday, asked U.S. District Judge David Hittner in Houston to find Stanford competent to stand trial.

A doctor who evaluated the defendant at a federal prison in Butner, North Carolina, “concluded that Stanford’s performance indicated that he was ‘blatantly simulating cognitive defects/known to be malingering,’” Costa said.

Stanford, 61, has been imprisoned as a flight risk since his June 2009 indictment on charges of defrauding investors through a scheme built on allegedly bogus certificates of deposit at Antigua-based Stanford International Bank Ltd.

Hittner delayed the trial, which had been set for last January, after three doctors testified that Stanford was incapable of assisting in his defense. They said Stanford had become addicted to anxiety drugs prescribed in prison and could be suffering lingering effects of a head injury suffered in a 2009 inmate assault.

‘No Viable Alternative’

Ali Fazel, Stanford’s lead criminal-defense attorney, urged Hittner in a separate court filing to reject the Butner medical evaluation and continue delaying Stanford’s trial. Fazel asked the judge to rely on the testimony of experts Stanford’s defense team plans to present at a competency hearing next week in Houston.

“The accused’s mental condition has not so improved as to permit the proceedings to go forward,” Fazel said in a proposed order asking Hittner to find Stanford unfit for trial, citing the addiction and head-trauma issues. “The court has no viable alternative but to disagree” with the Butner doctors’ certification of Stanford’s competency, he said.

“We believe the Butner report the government is citing doesn’t indicate what they say it does,” Fazel said in a brief phone interview. He declined to comment further, citing Hittner’s order barring attorneys from publicly discussing the case.

‘Retrograde Amnesia’

Stanford first began complaining of “extensive retrograde amnesia” from the jailhouse attack sometime after he arrived at Butner in February, according to the prosecutors’ filing. “Stanford has recently repeatedly claimed being ‘completely amnestic to his life prior to the assault, stating that 59 years were stolen,’” Costa said in the filing, citing the Butner report.

Stanford claimed to be unable to recall life events “including his romantic encounters with various female partners, past vacation and holiday activities with his children, visits with famous politicians, as well as details of his business and banking operations,” Costa said. Stanford claimed family members had to “educate” him about his previous life, and the former billionaire “indicated feeling bad after being informed by his family that he was known as a ‘womanizer,’” Costa said, citing the Butner report.

Prosecutors claim Stanford skimmed more than $1 billion of investor funds to finance a lavish lifestyle that included a fleet of jets and yachts, several mansions and a private Caribbean island, as well as financial support for women with whom he has had children.

Spontaneous Recall

“FMC Butner concluded that Stanford’s complaints of memory loss were ‘not credible’ based on the fact that he had ‘no difficulty spontaneously recalling personal and business information” during the period after his September 2009 assault and before he got to Butner, Costa said in the filing.

Prison staffers, who monitored Stanford’s inmate e-mail and phone conversations, said he appeared to have no trouble discussing certain current events and personal experiences with family members while still incarcerated in Houston following the attack, Costa said in the filing. Stanford also represented himself in May 2010 at a Houston court hearing, where he “spoke cogently and with significant recall of events in arguing his case,” Costa said.

Robert Bennett and Kent Schaffer, both former Stanford attorneys, “also confirmed that, following the assault, Stanford did not have any difficulty recalling information that predated the assault,” according to the filing.

Brain Scan

In addition to more than 16 different neuropsychological tests administered by prison and outside doctors, Stanford underwent a magnetic brain scan in March that showed “no evidence of damage to any part of Stanford’s brain that processes memory,” Costa said. “Specifically, the neurologist found that Stanford’s reported memory deficits were ‘grossly out of proportion to expected memory loss’ from a head trauma,” Costa said.

Stanford’s defense team has tried “to excuse Stanford’s suspiciously low performance on the tests on the ground that he was depressed and sleep deprived,” Costa said in the filing. He said the doctors who evaluated Stanford for his defense offered no explanation “as to why, even assuming depression and fatigue, Stanford’s performance would be worse than subjects with advanced dementia or mental retardation.”

If Hittner determines Stanford is mentally fit, his trial will begin Jan. 23.

The case is U.S. v. Stanford, 09-cr-342, U.S. District Court, Southern District of Texas (Houston).

To contact the reporter on this story: Laurel Brubaker Calkins in Houston at laurel@calkins.us.com

To contact the editor responsible for this story: Michael Hytha in San Francisco at mhytha@bloomberg.net

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