Years ago, defendants made millions off investments with R. Allen Stanford and his related financial companies. But those “net winners,” whose money came from Stanford’s massive Ponzi scheme, now have to return the profits they received to a court-appointed receiver in charge of recovering billions, according to a recent decision from the U.S. Court of Appeals for the Fifth Circuit.
Stanford was convicted in 2012 of fraud and sentenced to 110 years in federal prison. Receiver Ralph S. Janvey has spent years trying to recover the $7 billion Stanford and his companies sold in the form of fraudulent certificates of deposit—paying high returns to early investors in Stanford’s scheme in order to create credibility with future investors. A trial court ordered the investors who’d received profits off their investments to return them to the receiver—orders they appealed to the Fifth Circuit.
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