Fort Lauderdale attorney Stuart Rosenfeldt, the onetime law partner of Scott Rothstein, always maintained he had no part in the notorious Ponzi schemer’s $1.2 billion investment scam.
On Wednesday, Rosenfeldt pleaded guilty in Miami federal court to an unrelated conspiracy charge that he made illegal campaign donations, committed bank fraud and threatened a high-priced prostitute to keep their sexual encounters secret.
By pleading guilty to the single conspiracy count, the 59-year-old Boca Raton resident will face up to five years in prison at his sentencing on Sept. 24 before U.S. District Judge Marcia Cooke. He will also lose his license to practice law. But he avoids the risk of a potential racketeering charge that could have led to stiffer punishment for the former senior partner at Rothstein Rosenfeldt Adler.
“None of these overt acts in the conspiracy in any way helped the Ponzi scheme,” Miami attorney Bruce Lehr said after the plea hearing Wednesday. “It’s a vindication for him, and the dark cloud of Rothstein is moving away. He’s willing to own up to what he did.”
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Lehr credited the U.S. attorney’s office for realizing that contrary to Rothstein’s assertions, no evidence from the law firm’s computers, financial records and emails showed that Rosenfeldt knew about or participated in his former partner’s elaborate investment swindle, among Florida’s largest financial rackets.
After his guilty plea, Rosenfeldt became the 21st co-defendant to be convicted in the ongoing Rothstein investigation conducted by the FBI and Internal Revenue Service.
The prosecutions and plea bargains began to accelerate after Rothstein, who was sentenced to 50 years in prison, testified at the February trial of one of his law firm’s associates, Christina Kitterman. After she was convicted of impersonating a Florida Bar official to help Rothstein keep his investment scheme alive, six other suspects quickly cut deals with prosecutors — including the other partner on the firm’s nameplate, Russell Adler. He pleaded guilty to campaign finance violations and is scheduled to be sentenced later this month.
Rosenfeldt was known as one of South Florida's top labor lawyers, and started the Las Olas Boulevard law firm with Rothstein in 2002.
Rothstein used his 70-attorney law firm to dupe wealthy investors from South Florida to New York into buying legal settlements at steep discounts — with promises of huge profits. The scheme was a fiction and collapsed in late October 1999.
Rosenfeldt always denied that he knew anything about Rothstein's Ponzi scheme, saying that he and Rothstein had an agreement that he would handle the legal side of the firm's operations while Rothstein handled the financial side.
But Rosenfeldt enjoyed what Rothstein called “the rock-star lifestyle,” according to federal prosecutors Lawrence LaVecchio, Jeffrey Kaplan and Paul Schwartz.
Rosenfeldt admitted he made hundreds of thousands of dollars in political contributions to GOP presidential nominee John McCain and U.S. Senate candidate Charlie Crist that were illegally reimbursed by Rothstein through salary bonuses.
Rosenfeldt also acknowledged he committed check-kiting crimes for Rothstein to prop up their law firm’s finances.
Perhaps most embarrassing, Rosenfeldt admitted that he arranged with Rothstein to have law enforcement officers intimidate an “escort” and her boyfriend when Rosenfeldt believed they were about to expose his sexual relationship with the prostitute.
In September 2009, Rosenfeldt, Rothstein and then-Broward Sheriff's Lt. David Benjamin met at the law firm to discuss “having the escort and her boyfriend threatened with arrest,” according to prosecutors.