FORT LAUDERDALE
Federal agents raid Scott Rothstein's law offices
Federal authorities turned up the heat on Fort Lauderdale lawyer Scott Rothstein as he sought to cooperate with prosecutors investigating his alleged multimillion-dollar investment scam.
BY AMY SHERMAN AND JAY WEAVER
jweaver@MiamiHerald.com
Dozens of federal agents on Wednesday night raided the Fort Lauderdale law offices of attorney Scott Rothstein, a swaggering lawyer under investigation for allegedly masterminding an investment scam that could reach hundreds of millions of dollars.
FBI and IRS agents seized documents, computer files and other records from Rothstein Rosenfeldt Adler's 16th-floor offices, 401 E. Las Olas Blvd.
``I just made sure they knew where everything was,'' partner and firm co-founder Stuart Rosenfeldt told The Miami Herald. ``I signed the consent to search for things not in the warrant. I gave them full access to the entire office. The safe, I unlocked it.
``I found the keys for all but one door to a room [where] I honestly suspect things were damaging to my partner. I gave authorization to remove the lock.''
Rothstein, 47, has been accused by his investors and law partners of wiping them out. He is cooperating with federal investigators and identifying others who may be involved in the alleged Ponzi scheme, sources familiar with the probe said Wednesday.
People in Broward County legal circles have wondered how Rothstein -- a man-about-town who lived large and donated millions to charities and politicians -- could have pulled off the alleged scheme without colleagues at the law firm knowing about it.
Investigators are looking into allegations that Rothstein bilked investors by selling them falsified lawsuit settlements, and that he stole from client trust funds and operating accounts at his 70-attorney law firm, the sources said.
Rosenfeldt has repeatedly said that he didn't know about Rothstein's alleged wrongdoing before news broke last week.
``When we established a partnership we delegated responsibilities: He was the money man. I was the law man,'' Rosenfeldt, a 50 percent co-owner ofthe firm, told The Miami Herald on Wednesday. ``I trusted him with my life. He controlled everything when it came to money.''
Rosenfeldt's name, however, is included in a Toronto Dominion Bank letter addressed to Rothstein in early October that allows either lawyer to approve the distribution of settlement payments to Rothstein's investors. A Toronto Dominion branch in Fort Lauderdale held some of Rothstein's accounts for investors claiming he bilked them.
``I never saw that letter,'' Rosenfeldt told The Herald. ``I am finding he used my name a lot when I didn't know it.
``I didn't know I had control over the distribution of the [investment] funds,'' he added. ``I don't know if that letter is real. I don't know if he communicated with [the bank] about my authority. I was a signatory on a host of accounts.''
Rothstein returned from Morocco on Tuesday after leaving Fort Lauderdale on Friday, just as the news began leaking out. On Saturday, he texted his law colleagues apologizing for ``letting you all down.''
The message continued: ``I am a fool. I thought I could fix it but got trapped by my ego and refusal to fail and now all I have accomplished is hurting the people I love.''
Russell Adler, the firm's third name partner, has hired Fort Lauderdale criminal defense attorney Fred Haddad. Adler could not be reached for comment.
Rothstein and his defense attorney, Marc Nurik, have disclosed details of his alleged scheme to prosecutors, FBI agents and IRS agents at the U.S. attorney's office in Fort Lauderdale, sources said.
The ``structured settlements'' were proceeds from employment discrimination cases sold to investors who were promised lucrative returns for fronting most of the payouts.
Investigators are also examining Rothstein's relationship with Toronto Dominion Bank.
On Wednesday, Rosenfeldt told The Herald that he first learned something was wrong on Friday, when some of Rothstein's investors called him to report that they were missing millions of dollars.
Rosenfeldt said when he checked the firm's operational accounts Sunday, he saw grim numbers. The balance: $117,000.
He said Rothstein had exclusive oversight over the firm's money.
Rosenfeldt said he last asked to see the firm's books a few years ago. Rothstein agreed, but then changed the subject. Rosenfeldt said he and Rothstein did not discuss cash flow, budgeting or auditing.
``Scott did all of that,'' he said. ``Scott told me we had audits being done regularly.''
Rosenfeldt said that he knew that Rothstein was running some kind of investment business, but did not know the details.
``He told me he was working for a hedge fund identifying and buying businesses to be in hedge fund portfolios,'' he said.
But one lawyer representing investors who claim they got burned by Rothstein said Rosenfeldt was aware of his partner's ``structured settlement'' investment fund.
Mark F. Raymond, an attorney who specializes in securities litigation at Broad and Cassel, said one investor told him that Rosenfeldt was at an initial meeting in March 2009, at which Rothstein explained structured settlements.
Rosenfeldt disputed that account.
``I never met with any of the settlement funding investors where such business wasdiscussed,'' he said in ane-mail.
Raymond also said that David Boden, an attorney who worked out of the law office on Rothstein's investment dealings, was at the March meeting. ``He was the point person for Rothstein on structured settlements,'' he said.
Several attempts to reach Boden this week at the firm and his home were unsuccessful.























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