ibnlive » Business

Jan 22, 2013 at 11:48pm IST

US: Ex-Stanford executive James Davis gets 5 years for $7 billion swindle

Houston: A judge on Tuesday sentenced the star prosecution witness in the trial of convicted Texas financier R Allen Stanford to five years in prison for bilking investors of more than $7 billion in one of the biggest Ponzi schemes in US history. James M Davis, who was sentenced in a Houston federal court, was facing up to 30 years in prison after pleading guilty in 2009 to three fraud and conspiracy charges.

Prosecutors say Stanford persuaded investors to buy certificates of deposit from his Caribbean bank, then used that money to bankroll a string of failed businesses and his own lavish lifestyle.

Davis is the former finance chief for Stanford's various companies. He testified that he and Stanford faked the bank's profits and fabricated documents to hide the fraud.

Ex-Stanford exec gets 5 years for $7 bn swindle

Stanford used investors' money to bankroll a string of failed businesses and for his own lavish lifestyle.