Ben Barnes Sued for $5 million by Stanford Receiver
March 25, 2010
By Stanford Receiver
Democratic lobbyist and former Texas Lieutenant Gov. Ben Barnes has been slapped with a $5 million lawsuit over lobbying and
consulting services he provided to R. Allen Stanford, the indicted financier accused of running a multibillion-dollar Ponzi
scheme.
The suit was filed on Mar. 15 by Ralph Janvey, the receiver appointed by the court to recoup the investors' losses. It alleges
that Barnes raked in millions doing consulting and lobbying work for Stanford's fraudulent investment empire since 2005.
Stanford is accused of bilking tens of thousands of investors out of nearly $8 billion, in one of the largest phony investment
schemes of all time.
Barnes's attorney, Jay Madrid, said that the lawsuit was baseless because his client was unaware that Stanford's businesses
were illegitimate at the time the services were provided. "This lawsuit is without merit and creates a dangerous precedent for
service providers in all fields," said Madrid in a written statement. "This is particularly true of those who deal in good faith
with entities that have all the characteristics of legitimate enterprises but who after-the-fact become subject to receiverships,
bankruptcies or similar business failings."
But the lawyer for the court-appointed receiver said that that argument does not absolve Barnes of responsibility. "In a
fraudulent transfer action, lack of knowledge of the fraud is not a defense," attorney Kevin Sadler told the NLPC over email.
He said that Barnes must prove that he was both unaware of the fraud and that the services he provided to Stanford were
equivalent in value to the fees he collected.
"Barnes will not be able to establish the affirmative defense of objective good faith and reasonably equivalent value. His
services left creditors of the Stanford entities with nothing of value," wrote Sadler.
The lawsuit alleges that in many cases Barnes's company "performed services [for Stanford] that simply furthered the Ponzi
scheme." This work reportedly included consulting Stanford on how to reduce his personal federal income taxes through the Virgin
Islands tax incentive laws and providing investment advice. The lawsuit also says that marketing work done by Barnes for
Stanford's businesses "had the unfortunate effect of attracting new victims to [Stanford's] fraudulent investment scheme."
Barnes, a heavy-hitter in Democratic political circles, is no stranger to financial scandals. While serving as Texas Lt. Gov.
the early 1970s, allegations that Barnes and other state politicians accepted bribes for political favors surfaced in an
incident known as the Sharpstown scandal. Barnes was never charged, but the episode helped contribute to his exit from career
politics.
Now a successful lobbyist, Barnes is still very much involved in the political arena. Last September, he hosted a Democratic
Congressional Campaign Committee fundraiser for House Speaker Nancy Pelosi (D-CA) at his home in Austin, TX. Barnes and his
wife have given $249,800 in political contributions in 2010, with 100 percent of those contributions going toward Democratic
candidates, according to Open Secrets.
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| Anonymous wrote on October 29, 2011 at 01:30 |
|
Watch this Obama! What happens with this corrupted Democratic lobbyist Ben Barnes? Are you also involved in this Ponzi Scheme? :-D |