Texas financier R. Allen Stanford, jailed on charges of bilking investors out of $7 billion, was hospitalized Thursday with an irregular heartbeat and high pulse, just hours before his ex-finance chief became the first person to plead guilty in the case.
Stanford was set to appear in a Houston federal courtroom for a hearing on whether he can get a new attorney. His current lawyer, Dick DeGuerin, has asked for permission to quit the case because he doesn't have assurances he will be paid.
In the same courtroom, Stanford's former chief financial officer, James M. Davis, pleaded guilty Thursday to three counts: conspiracy to commit mail, wire and securities fraud; mail fraud; and conspiracy to obstruct a Securities and Exchange Commission investigation.
"I did wrong. I'm sorry. I apologize. I take responsibility for my actions," Davis, 60, said as he left the federal courthouse after his hearing.
Davis' attorney David Finn said his client has been cooperating with prosecutors for the last six months and the guilty plea is part of a deal with the Justice Department in exchange for a possible reduced sentence.
Davis faces up to 30 years in prison when he is sentenced. While a sentencing date of Nov. 20 was set, Finn said he believes that will be delayed.
As part of his plea agreement, Davis was also ordered to forfeit $1 billion in proceeds he made from his illegal actions.
Finn said authorities have seized all his client's assets and Davis, who had made between $5 million and $6 million in the last decade, is broke and now doing manual labor on a family farm in Michigan, making $10 an hour. Davis is originally from Mississippi.
Stanford, Davis and other executives of the now defunct Houston-based Stanford Financial Group are accused of orchestrating a massive Ponzi scheme by advising clients to invest more than $7 billion in certificates of deposit from the Stanford International Bank in the Caribbean island of Antigua, creating false records to inflate the bank's assets and then misusing the money, in part to pay for Stanford's lavish lifestyle.
DeGuerin said Stanford was taken from the privately run prison where he is being held outside Houston at about 5:30 a.m. Thursday to the Conroe Regional Medical Center.
U.S. District Judge David Hittner said Stanford had an irregular heartbeat and an "extremely" high pulse.
A spokeswoman for the medical center declined to release any information Thursday to The Associated Press.
DeGuerin said Stanford has high blood pressure and told reporters after the hearing he doesn't think his client has received good medical care since being jailed. DeGuerin said he didn't have a condition update on Stanford.
"I wouldn't be surprised if stress exacerbated his condition," said DeGuerin, who added he wasn't planning on visiting Stanford in the hospital.
Finn said he didn't think it was a coincidence Stanford fell ill on the day Davis pleaded guilty in the case.
"I think it had everything to do with my client and I and prosecutors gathering in the courtroom today," he said.
DeGuerin suggested the money bilked from investors went to Davis but Finn said his client was used and manipulated by Stanford.
Hittner postponed a hearing scheduled for Thursday in which he would hear arguments about Stanford's legal representation.
Stanford was considered one of the richest men in the U.S. with an estimated net worth of more than $2 billion. But he claims he is now penniless.
Last month, Stanford's spokesman said the jailed financier had hired Washington, D.C.-based attorney Robert Luskin, who also represents former White House political adviser Karl Rove. But Luskin also wants assurances he'll get paid, and Hittner won't release DeGuerin until an attorney takes the case unconditionally.
Stanford, along with three former company executives, have pleaded not guilty to various charges, including wire and mail fraud, in a 21-count indictment issued June 18. Stanford has been jailed without bond since then, considered a flight risk by Hittner.
Also indicted is Leroy King, the former chief executive officer of Antigua's Financial Services Regulatory Commission. King, accused of taking bribes from Stanford to overlook irregularities at his bank, is awaiting extradition to the United States.
Finn said Davis is helping prosecutors with their efforts to extradite King and locate missing money taken from investors.