The receiver in accused swindler Allen Stanford's civil fraud case is suing about 200 investors for as much as $545 million they collected from certificates of deposit alleged to be at the center of a $7 billion Ponzi scheme.
The investors named in the lawsuit are said to have unfairly cashed out before the U.S. Securities and Exchange Commission filed civil charges and seized Stanford's assets and businesses in February.
"The CD proceeds the Stanford investors received from Stanford International Bank (SIB) were not, in fact, their actual principal or interest earned on the funds they invested," said the lawsuit, filed in federal court in Dallas on Monday.
"Instead, the money used to make those payments came directly from the sale of SIB CDs to other investors," the lawsuit said.
Ralph Janvey, the court-appointed lawyer charged with returning assets to Stanford investors, attempted to settle with the investors before filing the lawsuit.
Some of those investors have returned the amounts they received in excess of their principal investment in the CDs issued by SIB in Antigua, and more settlements are expected, according to the court papers.
Janvey is pursuing the claims under fraudulent transfer law and principles of unjust enrichment after a federal appeals court in New Orleans ruled last month that he could not sue the investors using a different legal claim.
Stanford faces criminal charges that he defrauded thousands of investors around the globe through CD sales. He has pleaded not guilty and is in a Houston jail awaiting trial.
The case is Ralph S. Janvey v. James R. Alguire et al, U.S. District Court, North District of Texas, No. 09-cv-00724.
© 2016 Thomson/Reuters. All rights reserved.