When R. Allen Stanford and other employees of his company were charged for their roles in a $7 billion ponzi scheme, their assets were immediately frozen. Unfortunately, this left the defendants with no available finances to hire a Houston criminal attorney, so a public defender was instead offered to them.
Because defense of white collar crimes can often add up fast, a judge calculated that the defense of these men will be worth a minimum of one million dollars. Rather than have tax payers spend their money on the matter, the judge has decided that the insurance company, Lloyd’s of London, will be responsible for footing the bill. A company policy states that they will be responsible for legal costs of directors and officers, but Lloyd’s has so far refused to pay for the legal bills on the grounds that the company believes they are guilty.
Judge Hittner rebuked their argument, saying it was “absurd because these circumstances are precisely why corporations procure D&O insurance on behalf of their directors and officers…it would contravene the very purpose of the policies — as well as the policy language itself — to require (the accused) to prove their innocence before being entitled to funds for their defense.”
To read more about the decision, see the article in the Houston Chronicle. Image via colinmford [Flickr].