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Rothstein’s ex-buddies brace for criminal charges

 

A lot of people who benefitted from their association with Scott Rothstein could soon face criminal charges.

 

Scott Rothstein was deposed for days by attorneys trying to recover money lost in his Ponzi scheme. The things he said could help the feds file charges against his ex-cronies.
Scott Rothstein was deposed for days by attorneys trying to recover money lost in his Ponzi scheme. The things he said could help the feds file charges against his ex-cronies.
Charles Trainor Jr

jweaver@MiamiHerald.com

When Scott Rothstein was arrested in late 2009 for running more than a billion-dollar investment scam, everyone wondered who else was in on it.

If you are to believe the extraordinary testimony the convicted South Florida attorney recently gave in civil cases brought by hundreds of his fleeced investors, the cast of potential criminal co-conspirators reads like credits in an epic movie entitled “The Great Ponzi Scheme.”

Rothstein, 49, who once lived in a waterfront mansion and chartered private jets, testified he blew $150 million on a “rock-star lifestyle” that allowed him to swagger in legal, business and political circles to create the illusion of power to peddle his Ponzi. But he also alleged he gave out cash like “Santa Claus hands out candy canes” to influence lawyers, politicians, judges and police officers, declaring that “bribes” and “public corruption” were another layer to his lifestyle of “greed.”

The middle-aged con man, now desperate to reduce his 50-year sentence so he doesn’t die in prison, fingered so many colleagues and associates during his so-called Big Deposition that the federal criminal investigation could result in far more defendants than first envisioned, according to lawyers familiar with the evidence.

“The criminal case is two or three times bigger than I thought, and I thought it was pretty big to begin with,” said Fort Lauderdale attorney William Scherer, who is representing 55 investors who lost $185 million in Rothstein’s racket.

“It went way beyond the Ponzi scheme — illicit businesses, money laundering, political campaign donations, mob connections, escort services, jewelry deals. He was the great corruptor of our community, and he rolled it all into this vast criminal enterprise.”

Charles Lichtman, a lawyer for the trustee handling the bankruptcy of Rothstein’s 70-attorney law firm, said his testimony over a two-week period in December “suggested that a fairly significant number of people got caught up in the fraud and could conceivably be prosecuted for a variety of bad acts.

“If you look at the fraud as a wheel, he was at the center and there were dozens of spokes coming out,” Lichtman said.

Rothstein, who was consumed with hustling money from others during the latter part of the past decade, fled Fort Lauderdale for Morocco in October 2009. His scheme of selling phony confidential legal settlements out of his Las Olas Boulevard law firm to wealthy investors from Florida, New York and Texas had suddenly crashed. His investors had lost more than $360 million.

On the lam, Rothstein had three choices: remain a fugitive living on $16 million he had wired to himself; take his own life with a cocktail of pills and vodka; or return to South Florida to face the feds.

Rothstein says he grew a conscience and decided to come home, giving prosecutors, the FBI and Internal Revenue Service an insider’s view of how he orchestrated one of Florida’s biggest financial frauds. Rothstein, now imprisoned in an undisclosed location under the federal witness protection program, has helped authorities prosecute seven others accused of playing supporting roles in his scheme.

But those prosecutions — including the firm’s chief operating officer, Debra Villegas; a fellow firm lawyer, Howard Kusnick; two tech-support employees, Curtis Renie and William Corte; a nightclub owner, Stephen Caputi; Rothstein’s uncle, William Boockvor; and an administrative assistant, Marybeth Feiss — have been mere rehearsals for blockbuster indictments likely to come later this year.

dealsaver
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