Alleged ponzi-schemer Allen Stanford has dropped a lawsuit seeking $7.2 billion from federal law enforcement because he says they violated his constitutional rights, but indicated that he could refile once the criminal case against him concludes.Stanford sued Justice Department officials as well as Federal Bureau of Investigation and Security and Exchange Commission agents last month for allegedly violating his Fourth, Fifth, Sixth and Eighth Amendment rights (guarding against unreasonable searches and seizures; abuse of government authority in a legal procedure; protecting rights related to criminal prosecutions; and cruel and unusual punishment, respectively).
Stephen R. Cochell, a Texas-based lawyer for Stanford, wrote in a motion filed last week that the claims in the action “will be preserved without pursuit of this case at this time.” A federal judge ordered the case dismissed on Monday.
In the suit, Stanford had alleged that agents of the U.S. “conspired to deprive Mr. Stanford of his civil rights by and through tactics taken under color of law, but which violate basic constitutional principles” and “used over $51,000,000 of Mr. Stanford’s own money to fund their investigation” while opposing attempts by Stanford to defend himself.
Stanford alleged that he came under scrutiny because the SEC was being criticized in late 2008 and early 2009 for failing to detect misconduct by Bernie Maddoff.
A judge ruled in January that Stanford was incompetent to stand trial and recommended he undergo treatment for his reported traumatic brain injury, addiction to an anti-anxiety medication and major depressive disorder at a federal facility with suitable medical capabilities. Stanford, whose full name is Robert Allen Stanford, is currently inmate #35017-183 and is being held in Butner, N.C.