Image: James M. Davis
Michael Stravato  /  AP
Former Stanford Financial CFO James M. Davis arrives at federal court in Houston Thursday.
updated 8/27/2009 11:45:31 AM ET 2009-08-27T15:45:31

Texas financier R. Allen Stanford, jailed on charges of bilking investors out of $7 billion, has been hospitalized with an irregular heartbeat and high pulse, the judge in his case said Thursday.

Stanford was set to appear in a Houston federal courtroom for a hearing on whether he can get a new attorney. His current lawyer, Dick DeGuerin, has asked for permission to quit the case because he doesn't have assurances he will be paid.

In the same courtroom, Stanford's former finance chief, James. M. Davis, pleaded guilty Thursday to three counts: conspiracy to commit mail, wire and securities fraud; mail fraud and conspiracy to obstruct a Securities and Exchange Commission investigation.

Davis' attorney David Finn has previously said that Davis, 60, cooperated with prosecutors and the guilty plea is part of a deal with the Justice Department in exchange for a possible reduced sentence. He will be sentenced on Nov. 20 and faces up to 20 years in prison.

Stanford, Davis and other executives of the now defunct Houston-based Stanford Financial Group are accused of orchestrating a massive pyramid scheme by advising clients to invest more than $7 billion in certificates of deposit from the Stanford International Bank in the Caribbean island of Antigua and then misusing the money.

Before the hearing, DeGuerin said Stanford was taken from the privately run prison where he is being held outside Houston about 5:30 a.m. (1030 GMT) Thursday to the Conroe Regional Medical Center.

U.S. District Judge David Hittner said Stanford had an irregular heartbeat and an "extremely" high pulse.

A spokeswoman for Conroe Regional Medical Center declined to release any information Thursday to The Associated Press.

Hittner postponed a hearing scheduled for Thursday in which he would hear arguments about Stanford's legal representation.

Stanford was considered one of the richest men in the U.S. with an estimated net worth of more than $2 billion. But he claims he is now penniless.

Last month, Stanford's spokesman said the jailed financier had hired Washington, D.C.-based attorney Robert Luskin, who also represents former White House political adviser Karl Rove. But Luskin also wants assurances he'll get paid, and Hittner won't release DeGuerin until an attorney takes the case unconditionally.

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