CaribWorldNews, HOUSTON, TX, Weds. April 21, 2010: A September hearing will have to decide whether the legal defense fees for accused Ponzi schemer, R. Allen Stanford will be paid by him or a British insurer.
U.S. District Judge Nancy Atlas on Tuesday scheduled a September hearing to determine whether Stanford and the three executives accused along with him of bilking investors out of $7 billion as part of a massive Ponzi scheme will have to foot their legal fee or whether Lloyd`s of London will have to pay up.
Lloyd`s of London says the insurance policy does not pay on charges of money laundering, which Stanford and the others are accused of doing.
But an appeals court last month ruled that legal fees for Stanford and the executives must continue being paid by the insurer. However, the appeals court also said that a lower court must determine if money laundering was committed in order for the policy to be invalid.
The dispute over payment of legal fees is part of a civil lawsuit filed by Stanford and the executives against Lloyd`s and is separate from the criminal case.
Stanford and the three executives have all pleaded not guilty to the fraud charges.