Stanford receiver files $1.8B suit against B.R. and N.O. law firms

The receiver for R. Allen Stanford’s alleged $7 billion Ponzi scheme claims two Louisiana law firms helped Stanford misappropriate more than $1.8 billion by giving false opinions to authorities and referring clients to Stanford in exchange for benefits, Courthouse News Service reports. Court-appointed receiver Ralph Janvey has filed a federal suit against Baton Rouge-based Breazeale Sachse & Wilson and New Orleans-based Adams & Reese. Janvey also sued Adams & Reese attorneys Robert Schmidt and James Austin, Breazeale Sachse & Wilson attorney Claude Reynaud, and Stanford Trust Co. directors Cordell Haymon and Thomas Frazier. In an 84-page federal complaint, Janvey accuses the defendants of negligence, breach of fiduciary duties, aiding and abetting or participating in breaches of fiduciary duty, aiding and abetting or participating in a fraudulent scheme, aiding and abetting or participating in fraudulent transfers, aiding and abetting or participating in conversion, civil conspiracy and negligent retention or supervision. Janvey says the defendant law firms “embarked on their own campaign to enrich themselves at their other clients’ expense,” and that while providing legal services to Stanford Financial they referred their own clients to Stanford. Janvey further claims that Reynaud and Breazeale Sachse & Wilson were brought in to help with Stanford’s purchase of Southern Trust Co., a Baton Rouge-based firm that established the investment retirement account component of the alleged Ponzi scheme. Stanford is currently on trial in Houston; he denies all charges. Read the full story here.