[ by Melanie Gretchen ]

Allen Stanford didn't act alone in his Ponzi scheme.  Two of his former accounting executives conspired to a hide a fraud scheme that bilked investors of $7 billion via bogus certificates of deposit at Antigua-based Stanford International Bank Ltd, a jury in federal court found.

Stanford's ex-Chief Accounting Officer Gilbert Lopez, 70, and former Global Controller Mark Kuhrt, 40, were found guilty in federal court after a jury of 7 men and 5 women deliberated for 16 hours over 3 days after the 5-week trial.   During closing arguments on 11/14/12, prosecutor Jason Varnado argued that, "They knew the bank was doing one thing and promising investors another, and they helped hide it."  The jury concurred finding each man guilty today of 9 of 10 wire fraud counts and 1 count of conspiracy to commit wire fraud. 

The men face more than 20 years of prison when they are sentenced Feb. 14 by U.S. District Judge David Hittner, who presided over the trial.  The judge ordered both men to be taken into custody, rejecting the government’s recommendation that they remain free on bond.  Going forward, defendants said they will appeal the verdicts, their lawyers said.

Messieurs Lopez and Kuhrt's representation argued their clients were duped by Stanford and finance chief James M. Davis into creating the false financial statements.  The executives relied on returns provided by Stanford and Davis and never intended to falsify company records or break any laws, the defense said.

Stanford, 62, was convicted in March of masterminding the fraud and stealing more than $2 billion of investor deposits and is currently serving a 110-year prison.  Davis, who pled guilty in 2009 and testified against Stanford at his trial, is awaiting sentencing. 

"There’s no doubt whatsoever there was a massive fraud going on, but it was a Stanford and Davis fraud, not a Lopez and Kuhrt fraud." -- Richard Kuniansky, Mr. Kuhrt’s lawyer, in closing arguments Nov. 14.

The case: U.S. v Lopez, 4:09-cr-0342, U.S. District Court, Southern District of Texas (Houston).

For further details, go to [Reuters, 11/19/12].