By Eileen O'Grady
Houston (Reuters) - Jailed tycoon Allen Stanford spent the night under psychological observation by federal detention officials, authorities said on the third day of a hearing on whether he is fit to stand trial for fraud.
Jail officials told a federal judge in Houston on Thursday that they acted "in an abundance of caution" after the testimony on Wednesday of a medical expert who said Stanford, 61, had been suicidal in the past.
Stanford, who has been in custody since his 2009 arrest, is accused of defrauding his investors through a $7 billion Ponzi scheme.
His lawyers argue he is not competent to go on trial as scheduled next month because a jailhouse fight and a drug addiction has left him with memory loss. Prosecutors say they think Stanford may be faking amnesia and that prison medical experts have deemed him competent to go on trial.
On Thursday, Stanford was heard in court complaining to his attorneys at the defense table about the psychological evaluation. He told them that he did not sleep all night.
Dr. Ralph Lilly, a neuropsychologist, testified on Wednesday that Stanford had been suicidal at some period since his arrest and was still considered a suicide risk.
After Wednesday's hearing, Stanford was moved to a more secure room but was not put under suicide watch, staff attorney Jennifer Hansen of the federal detention center in Houston told U.S. District Judge David Hittner.
Hansen told the court she had requested that Stanford be under psychological observation again Thursday night.
The judge has said he plans to issue a ruling on Stanford's competency later on Thursday after the hearing concludes.
(Reporting by Eileen O'Grady; Editing by Martha Graybow and Lisa Von Ahn)