Feb. 7 (Bloomberg) -- Republican and Democratic campaign committees have returned $1.7 million in contributions convicted Texas financier R. Allen Stanford made from proceeds of his $7 billion investment fraud, his receiver said.
Two Democratic committees and three Republican ones were ordered by a U.S. appellate court in October to return contributions Stanford made from 2000 to 2008 to his court-appointed receiver, who is marshaling assets to repay investors.
“They all finally paid as of two weeks ago,” Kevin Sadler, lead attorney for court-appointed receiver Ralph Janvey, said in an e-mail. “The Democratic Senatorial Campaign Committee’s share was about $1.2 million.”
The committees had argued they were legally entitled to keep the donations, which were spent long ago on a variety of campaigns.
Stanford, 62, is serving a 110-year prison sentence after he was convicted in March of swindling investors of $7 billion through bogus certificates of deposit at Antigua-based Stanford International Bank Ltd. He is appealing his conviction.
Stanford and his companies donated $950,000 to the DSCC; $238,500 to the National Republican Congressional Committee; $202,000 to the Democratic Congressional Campaign Committee; $128,500 to the Republican National Committee; and $83,345 to the National Republican Senatorial Committee, according to the receiver’s website.
The appeals court upheld a lower-court award of interest on the donations, bringing the total funds the five committees had to repay to more than $1.7 million, according to court papers.
Matthew Acosta, an attorney for the Democratic committees, declined to comment on the return of the funds in a phone interview today. Mark Shank, who represented the Republican committees, didn’t immediately respond to voice or e-mail messages seeking comment.
Previously, Janvey had recovered $169,535 in Stanford donations to individual politicians, who returned the money after learning of the fraud. He continues to seek repayment of roughly $100,000 in additional contributions to other politicians, according to the most recent tally on his website.
Investors swindled by Stanford may receive an interim distribution payment worth a penny on the dollar of their losses, Janvey said in a court filing in January.
Janvey asked a judge’s permission to pay more than 17,000 investors an initial distribution of $55 million, according to the filing in federal court in Dallas.
The case is Janvey v. Democratic Senatorial Campaign Committee Inc. et al, 11-10704, U.S. Court of Appeals for the Fifth Circuit (New Orleans).
To contact the reporter on this story: Laurel Brubaker Calkins in Houston at email@example.com.
To contact the editor responsible for this story: Michael Hytha in San Francisco at firstname.lastname@example.org.