US District Judge, Nancy Atlas, handed down her judgment on Friday, following a four-day trial in August, indicating that lawyers for the insurance company had proven that it was likely that Stanford had committed money laundering and therefore excluded him from coverage.

The ruling also affects former Stanford accounting executives Gilbert Lopez and Mark Kuhrt.

Stanford faces 21 counts of fraud when his trial begins on January 24, 2011. The charges stem from the alleged US$8 billion fraud conducted through the Stanford International Bank (SIB) in Antigua

According to reports, His attorney, Robert Bennett, said that Judge Atlas’ decision was “disappointing, but not unexpected”.

If he is assigned the court-appointed lawyer, Bennett would be paid by the government at a rate of US$125 an hour, a far cry from the US$1,000 an hour which Lloyd’s said the attorney had been charging.