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updated: 1/22/2013 11:18 AM

Allen Stanford's CFO James Davis gets five-year prison term

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Bloomberg News

Former Stanford Financial Group Co. finance chief James M. Davis was sentenced to five years in federal prison for his role in a 20-year, $7-billion international fraud scheme.

U.S. District Judge David Hittner imposed the sentence today at a hearing in federal court in Houston. He also sentenced Davis to three years of post-release probation.

Prosecutors had sought a 10-year term for Davis, 64, who pleaded guilty to felony charges in 2009 and testified against financier R. Allen Stanford. Davis's attorney asked the judge to cap the sentence at four years, citing his client's cooperation and early acceptance of responsibility.

"I'm not here telling your honor that Mr. Davis was a saint," the attorney, David Finn, told Hittner today. "From our first meeting he has been remorseful, contrite and has tried to make amends for the harm he has done."

Davis was the second-highest ranking member in Stanford's business empire, which included the Antigua-based Stanford International Bank Ltd. The bank offered certificates of deposit and the Houston-based Stanford Group Co. brokerage sold them. Stanford, who was convicted of lying about what his bank was doing with CD buyers' money, is serving a 110-year sentence at a U.S. prison in Coleman, Florida.

Former Roommates

Davis and Stanford once shared living quarters while they were students at Baylor University in Waco, Texas.

"I'm ashamed and I'm embarrassed," Davis told the judge today. "I've perverted what was right and did wrong. I hurt thousands of investors, I betrayed their trust, also that of associates, neighbors and friends, my family and this court and this country. Everything that I was part of, I failed them and I'm sorry."

Hittner recommended that Davis be sent to a U.S. prison camp near Memphis, Tennessee. Davis must surrender in 60 days.

The case is U.S. v. Davis, 09-cr-335, U.S. District Court, Southern District of Texas (Houston).

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