Seven charges against Allen Stanford dropped

Allen Stanford, 61, could still face 20 years in prison if convicted on any of the fraud counts.

TEXAS, United States, Friday May 6, 2011 – US prosecutors have unexpectedly dropped seven of the 21 criminal charges it filed against fraud accused Allen Stanford in 2009.

An amended, 14-count indictment was filed at the US District Court in Houston on Wednesday. Five counts of mail fraud, two counts of wire fraud and part of a conspiracy charge were dropped but it is unclear why the indictment has been narrowed.

What’s left are five counts each of mail and wire fraud, obstructing a US Securities and Exchange Commission (SEC) investigation, conspiracy to obstruct the SEC probe, conspiracy to commit wire and mail fraud (omitting securities fraud from the original indictment), and conspiracy to commit money laundering.

Stanford, 61, who allegedly defrauded investors out of US$7 billion through the sale of fraudulent certificates of deposit through his Stanford International Bank (SIB) in Antigua, could still face 20 years in prison if convicted on any of the fraud counts.

The court has set May 19 as the date for the former billionaire to be arraigned on the new indictment. Stanford is currently at a hospital in federal prison getting treatment for addiction to anti-depressants and his court case has been postponed until he gets over his addiction and is ruled competent to trial.

Reuters news agency quoted Stanford’s lawyers, Ali Fazel, as saying that the date for the new arraignment would have to be changed because "someone who is incompetent cannot be arraigned."

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