Stanford Receiver Asks Dems & GOP for $1.6M

(CN) - The receiver appointed to recover money from Allen Stanford's alleged $7 billion Ponzi scam says Democratic and Republican campaign committees have blown off his requests to return $1.6 million in donations.

The receiver claims in Dallas Federal Court that the five senatorial and congressional committees that accepted donations from Stanford International Bank did not provide anything in exchange for the money, and "have no legitimate right to retain the funds."

Court-appointed receiver Ralph Janvey says Stanford fraudulently transferred more than $1.6 million to the Democratic Senatorial Campaign Committee, the National Republican Congressional Committee, the Democratic Congressional Campaign Committee, the Republican National Committee, and the National Republican Senatorial Committee.

He says the political organizations have blown off two written demands for return of the money.

R. Allen Stanford and his associates James Davis and Laura Pendergest-Holt sold fraudulent certificates of deposit through Stanford International Bank with false promises of high returns, Janvey says in the complaint.

Janvey says that in 2008, rather than having a "well-diversified portfolio of highly marketable securities," the largest part of the bank's portfolio consisted of "at least $1.6 billion in undocumented 'loans'" to Allen Stanford, as well as "private equity," and "grossly over-valued real estate." Stanford spent investors' money on jets, a yacht, luxury cars, homes, travel and company credit cards and other luxuries, according to the complaint.

Stanford and associates falsified the bank's financial statements and its portfolio's performance, and paid old investors with new money until the scheme collapsed in 2009, the complaint states.

The Securities and Exchange Commission sued Stanford, Davis and Pendergest-Holt, and three Stanford companies in February 2009, and appointed Janvey to track down the money for investors. Stanford surrendered to FBI agents in June 2009.

Janvey demands that the political committees return the money. Lead counsel is Kevin Sadler with Baker Botts.

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