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posted: 9/13/2012 12:01 PM

Ex-Stanford exec gets 3 years for $7B swindle

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Associated Press

HOUSTON -- A once top executive in the now defunct empire of disgraced Texas financier R. Allen Stanford was sentenced to three years in prison on Thursday for her role in helping the once jet-setting businessman bilk investors out of more than $7 billion.

Former Stanford chief investment officer Laura Pendergest-Holt's sentence was part of a plea agreement she had reached with federal prosecutors. The sentence was handed down by U.S. District Judge David Hittner.

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Pendergest-Holt, 38, pleaded guilty in June to one count of obstruction of a U.S. Securities and Exchange Commission proceeding in exchange for the three-year prison sentence.

The obstruction count had carried a maximum prison term of five years. As part of the plea deal, prosecutors will drop 20 other counts she faced, including conspiracy, wire and mail fraud.

Prosecutors said Stanford, 62, used the money from investors who bought certificates of deposit, or CDs, from his bank on the Caribbean island nation of Antigua to fund a string of failed businesses, bribe regulators and pay for a lavish lifestyle that included yachts, a fleet of private jets and sponsorship of cricket tournaments.

The one-time billionaire was convicted in March on 13 of 14 fraud-related counts for orchestrating one of the biggest Ponzi schemes in U.S. history. In June, Hittner sentenced Stanford to 110 years in prison.

Prosecutors said Stanford lied to investors from more than 100 countries, telling them their funds were being safely invested in stocks, bonds and other securities.

Pendergest-Holt, a native of Baldwyn, Miss., was the first person indicted in the case. Prosecutors said she and other executives conspired to hide the bank's true financial health and provide misleading testimony to the SEC in 2009 when it was investigating Stanford's bank.

Two other indicted ex-executives -- Gilbert Lopez, the ex-chief accounting officer, and Mark Kuhrt, the ex-global controller -- are set for trial later this month. A former Antiguan financial regulator was also indicted and awaits extradition to the U.S.

Another indicted ex-executive -- former chief financial officer James M. Davis -- has pleaded guilty and faces up to 30 years in prison.

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