Crossing Over to Help Prosecutors
by: Pat Hernandez, July 13, 2009 10:07:30 pm
James Davis was the former CFO for the Stanford Financial Group. Founder R. Allen Stanford, remains in a private federal lockup in Conroe, after he was indicted on a variety of charges related to bilking thousands of investors in what prosecutors claim was a Ponzi scheme. The 60-year old Davis, a former college roommate of Stanford, pleaded not guilty to charges of conspiracy to commit
mail, wire and securities fraud and conspiracy to obstruct an SEC investigation. The initial plea gives prosecutors time to alert victims to their right to be heard.
"You're always hopeful that if you cooperate and assist, you'll be rewarded for your cooperation and assistance."
Attorney David Finn represents Davis. He says his client will eventually accept responsibility.
"We've been cooperating for over three months. We've had several meetings at the Dallas U.S. Attorney's office and we were here almost all of last week, debriefing and answering questions."
Gerald Treece: "You were suspicious of this when he wasn't named in the original indictment. And now we see the reasons for that separation is that he's been working with the government all along."
Professor Gerald Treece at the South Texas College of Law, says the government's case against the Stanford Group is not going to be successful unless it has cooperating witnesses.
"This case is in need of someone who's inside the boardroom making decisions, to explain that what was happening here wasn't negligence, but it was fraud. The fact that he's entered a plea agreement, also makes him pretty fair game for the defense lawyers, to argue that he is just selling out these other people. They haven't done anything. They're gonna blame this fella, the financial officer. And so, even though it's another day and another time, the script for these type of financial scandal cases seems pretty much to be the same, be it Enron, be it WorldCom now, the Stanford Group."
Davis was released on a half-million dollars bond. He is to change his plea to guilty as charged as part of a deal with the government. His trial is to begin September 8th with jury selection.
Pat Hernandez, KUHF...Houston Public Radio News.