Kennedy Leads Amicus Brief on Behalf of Stanford Ponzi Scheme Victims

Statement

Sen. John Kennedy (R-La.), joined by Sen. Bill Cassidy (R-La.), today filed an amicus brief in the case of Zacarias vs. Janvey. The case asserts the rights of victims of Robert Allen Stanford, who orchestrated the second-largest Ponzi scheme in U.S. history.

Zacarias vs. Janvey seeks to overturn a Fifth Circuit Court ruling that grants receivers--who are appointed by courts to oversee victims' claims for restitution--the power to block individual investors from pursuing their claims against Stanford and his accomplices. The senators' brief argues that the receiver, Ralph Janvey, and the district court have exceeded the judicial power the U.S. Constitution and Congress have granted them.

"The court appointed Mr. Janvey to help make Allen Stanford's victims whole again. Instead, he's keeping those victims from pursuing justice on their own. He's failing to deliver on his duties. Hardworking Louisianians have already been defrauded, and now the system is kicking them while they're down. The bottom line is that neither the receiver nor the court has the authority to prevent men and women from fairly asserting their claims against Stanford and his no-good sidekicks. The court must reverse this decision and restore the victims' right to recover what Stanford stole from them," said Kennedy.

In 2012, Stanford was convicted for leading a Ponzi scheme in which he sold $8 billion in fraudulent certificates of deposit from his offshore bank, Stanford International Bank. More than 1,000 Louisianians from Baton Rouge, Covington and Lafayette lost significant amounts of their life savings to the fraud. Since the Ponzi scheme was uncovered, less than five percent of the $8 billion has been returned to the victims.

"A receiver--as a creature of the district court--may not wield powers that exceed those properly granted to the district court itself. In rubber stamping the receiver's request to bar claims that the receiver had no standing to assert itself, the district court has strayed beyond the judicial powers granted to it in Article III and by Congress. Such actions constitute judicial law-making and usurp Congress's legislative power," says the senators' brief.

The text of the brief can be found here.

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