HOUSTON (AP) — A former employee testifying Monday in the fraud trial of jailed Texas financier R. Allen Stanford told jurors he worked in an office in which unqualified people, including an executive's farm hand and preacher, were hired as financial analysts and where he was asked to alter financial figures.
Mark Collinsworth was called as a prosecution witness, but his testimony seemed to benefit Stanford's defense as he told jurors under questioning by the financier's attorneys that Stanford was unaware of the hiring problems. Collinsworth instead said the person responsible for the troubled working environment was Stanford's right hand man, James Davis, and another company official, Laura Holt.
Prosecutors allege Stanford masterminded the fraud in which he bilked investors out of more than $7 billion in a massive Ponzi scheme centered on the sales of certificates of deposit from his bank in the Caribbean island nation of Antigua. Authorities allege he used depositors' money to fund his lavish billionaire lifestyle.
But Stanford's attorneys contend the financier was a savvy businessman whose financial empire was legitimate. They have suggested Davis, the ex-chief financial officer for the financier's company, is the real culprit behind the financial fraud. Davis has pleaded guilty in the case and is expected to be called by prosecutors this week. Holt has pleaded not guilty and is set to be tried with two other ex-Stanford executives in June.
Collinsworth, who worked as an asset allocation manager at the Memphis, Tenn., office of one of Stanford's companies, testified he felt the preacher at Davis' church and Davis' farm hand should not have been hired as analysts for the company. Stanford businesses, headquartered in Houston, had offices in the U.S., Latin America, the Caribbean and Europe.
"I don't think he should have been an analyst. He just couldn't get a grasp of finance, how the markets worked," Collinsworth said of Davis' preacher.
Collinsworth testified that Holt, the chief investment officer for Stanford's companies and who also worked in Memphis, had invested the company's funds with a hedge fund run by her husband, who previously had been a personal trainer. Collinsworth also said Holt had asked him to change "from negative to positive" figures related to a financial model Stanford's company used to manage its investments. He said he didn't change the numbers but doesn't know if they were altered by someone else.
"It's very clear in your mind Mr. Stanford relied on Mr. Davis and Ms. Holt to run the numbers portion of his business when it came to" the bank? Ali Fazel, one of Stanford's attorneys asked.
"Yes," Collinsworth replied.
But when questioned again by prosecutors, Collinsworth said he didn't know how many times Davis or Holt met with Stanford or what they told him at those meetings.
Stanford is on trial for 14 counts, including mail and wire fraud, and faces up to 20 years in prison if convicted. He was once considered one of the United States' wealthiest people, with an estimated net worth of more than $2 billion.
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