Another Jew, another Ponzi Scam

[CrackSmokeRepublican]

MIAMI (Reuters) - A disbarred Florida lawyer surrendered to the FBI on Tuesday and pleaded not guilty to charges he ran a complex Ponzi scheme that bilked investors out of more than $1 billion.

Scott Rothstein, who fled to Morocco in late October but returned to Florida in early November, was denied bond during a brief appearance before a federal magistrate in Fort Lauderdale.

He was charged with racketeering conspiracy under a statute often used to prosecute organized crime chiefs and drug lords.


Rothstein, who was disbarred last week by the Florida Supreme Court, also was charged with mail, wire and bank fraud, and money laundering. He faces up to 20 years in prison on the racketeering charge and up to 100 years if convicted on all counts, plus forfeiture of tens of millions of dollars in illegal profits.

The FBI said that Rothstein, 47, had been selling shares in fabricated legal settlements to unsuspecting investors since at least 2005, using new investor money to pay previous investors in the classic Ponzi scheme model.

He claimed to have won lucrative awards in workplace discrimination and whistle-blower lawsuits, when no such settlements existed, federal investigators said.

Rothstein pleaded not guilty to all the charges. His lawyer, Marc Nurik, said after the hearing that Rothstein was "going to try to do the right thing" for his investors.

"My client wishes to see that legitimate investors get paid their money back," Nurik told journalists, without specifying how that might be done.

FBI and IRS agents raided Rothstein's Fort Lauderdale law office in November and seized his waterfront home, yacht and other properties in Florida, New York and Rhode Island.

Investors have already begun filing lawsuits saying they were cheated and should get a share of the assets. Lawyers for the alleged victims said the scheme was so massive and complex that Rothstein could not have acted alone.

The Miami Herald said federal prosecutors would ask a grand jury to consider criminal charges against his alleged co-conspirators, possibly including former employees of his now-defunct firm.

He was chief executive and managing partner in the firm of Rothstein Rosenfeldt Adler PA, which was placed in receivership in November.

Rothstein, a frequent campaign contributor who was often photographed with politicians, lived a lavish life with opulent homes and a fleet of foreign sports cars. He used his connections and charm to lure wealthy friends and patrons to invest with him.

Early on Tuesday morning, television cameras showed him being led into the FBI headquarters with his hands cuffed behind his back.

(Reporting by Jane Sutton, editing by Jim Loney and Vicki Allen)

http://www.iraq-war.ru/article/211973

[CrackSmokeRepublican]

Scott Rothstein's rise and fall
After law school, 'he was always looking for more,' says one of Ponzi scheme suspect's ex-friends

By Robert Nolin, Lisa J. Huriash and Scott Travis, Staff writers

11:06 p.m. EST, December 5, 2009


Before the spiky hair and foul-mouthed bravado, before the mansions, yachts, cars and celebrities, before the crushing fraud charges and stark jail cell, Scott Rothstein was a curly-haired youth who serenaded a high school girlfriend with Beatles tunes.

"He was a very nice Jewish kid, cute, loved to sing," said Stacey Mahler Hayes, now of Long Island. "The kind of kid you'd bring home to your mother."

Somewhere during Rothstein's growth from earnest teenager to motivated law student to ambitious attorney, he chose a path that ended, according to an FBI agent, with him masterminding what could be the largest fraud in South Florida history.

"Once he became an attorney, and he was trying to move up, and he saw that money ... that's when he really started to change," said Jay Ravede, a Plantation insurance agent who knew Rothstein during college, law school and his early days as a lawyer. "He was always looking for more. He wanted to make more money."

And he did, according to the federal racketeering and fraud charges filed against him last week. Prosecutors said that after engineering a massive Ponzi scheme in 2005, Rothstein raked in $1.2 billion from investors and spent much of it on a lavish lifestyle.

He is now in a jail cell in Miami awaiting a trial tentatively scheduled for January. He has pleaded not guilty.

Rothstein's beginnings were humble. The son of a salesman who specialized in condoms and flavored toothpaste, Rothstein, 47, moved in 1976 from the Bronx to Lauderhill, where his parents rented an apartment.

"Very lower middle class," was how Leonard "Butch" Brunky, Rothstein's best friend from those days, described it.

"Neither one of our families had any money. We both came from pretty much nothing," recalled Brunky, now of Washington Township, Mich.

The pair hung out in Rothstein's apartment, playing guitar, or took to the tennis court. Like many of the figures from his past interviewed for this story, Brunky remembered Rothstein fondly.

"He was a very giving, good kid," he said. "If anything shady was going on, Scott was the last one to be involved."

Mark Nichols, now an attorney in Kentucky, graduated from Boyd Anderson High School in 1979, a year before Rothstein.

"He was a great guy, full of energy, very outgoing, very bright, intelligent, possessed leadership qualities," Nichols said.

As a junior, Rothstein played guitar and sang in a rock band, covering songs by Led Zeppelin and Lynyrd Skynyrd, sometimes landing gigs in a restaurant. He also sang in the school choir and a barbershop quartet.

Rothstein, Nichols and others formed a committee to advocate the construction of a school auditorium, organizing a rally of about 200 students before the Broward School Board.

At his class graduation in 1980, Rothstein sang We May Never Pass This Way Again.

Friends from that time are trying to reconcile the guy they knew with the man described in news stories and accused in court documents.

"I don't think he started corrupt," Nichols said.

Hayes, two years younger, experienced Rothstein's tender side.

"He liked me," she said. "We kissed. We made out. He used to sing Yesterday."

http://www.sun-sentinel.com/news/browar ... 8223.story

[CrackSmokeRepublican]

Rothstein Funded Charlie Crist's VP Effort
 (Ugly Rumor of Crist Making Out With Woman Shot Down)
Broward Palm Beach New Times ^ | December 16, 2009 | Bob Norman

Posted on Thursday, December 17, 2009 5:06:39 PM by PJ-Comix

Remember how Charlie Crist emerged on the "short list" to become John McCain's running mate last year?


Maloman Photographers

Crist with the Rothsteins at Versace mansion wedding.

​Well, the behind-the-scenes money that helped make that happen came from, yes, of course, Scott Rothstein. Those were the Ponzi schemer's favorite candidates, after all.

Rothstein, you understand, put huge amounts of his stolen money into the campaign coffers of both Crist and McCain. He put millions of dollars into McCain's campaign, most of it bundled illegally through lawyers in the RRA firm and business associates. So much that Rothstein was made a member of the Arizona senator's unofficial "kitchen cabinet" of top supporters. Rothstein was, in fact, McCain's fourth-ranked fundraiser on the national level, and the Republican nominee kept Rothstein's number in his cell phone and vice versa, says a campaign insider.

Naturally Rothstein wanted his good friend Crist on the ticket and is said to have promised McCain personally that if Crist were chosen, he would raise the money to bring Florida to the GOP's side of the ledger in the general election. Rothstein put vast resources into the Crist-for-VP effort, paying for travel, hotel suites, meals, mailings, and other expenses, according to the insider. He allegedly paid Republican political consultant Roger Stone $50,000 to get to work to make sure Crist was named on the VP shortlist of three in the national media.

Of course, Crist made that shortlist, and Stone clearly worked his magic to help make it happen. He promoted Crist on his blog, StoneZone, which was then sponsored by Rothstein and is read religiously by GOP heavyweights. Remember when the rumor emerged that Crist was caught making out (with a woman!) in an elevator? That was a Stone plant, likely meant to overpower rumors and reports that the governor is gay. There is rampant speculation that Crist's engagement with Carol Rome was initially part of the VP push as well.

Stone wouldn't confirm or deny that he was paid the $50,000, but he confirmed that Rothstein made a considerable effort on behalf of Crist for the vice presidency. "Under federal law, expenditures to promote someone for vice president are not reportable or disclosable," he said. "It's perfectly legal to spend whatever you want."

 

rothsteinmccain.jpg
John, Kim, Scott, Carol, and Charlie from RRA office wall.
​

Now of course in the end McCain, who enjoyed a fundraiser or two at Rothstein's home, didn't choose Crist, instead opting for Sarah Palin.

What needs to be done is a thorough accounting of just how much Rothstein sank into the Crist-for-VP effort and exactly where it went.

Specifically, did Rothstein pay for Crist's travel, hotels, and meals on the McCain campaign trail?
TOPICS: Politics/Elections
KEYWORDS: charliecrist; scottrothstein
Remember when the rumor emerged that Crist was caught making out (with a woman!) in an elevator? That was a Stone plant, likely meant to overpower rumors and reports that the governor is gay.

Whew! What a relief! So that ugly rumor that Charlie Crist was caught making out with a woman on an elevator turned out to be false.

BTW, I know a woman who worked at Rothstein's law firm and she tells me that Crist was frantically trying to distance himself from Rothstein just before she lost her job when everything collapsed there. She is still owed for two weeks of unpaid work.
1 posted on Thursday, December 17, 2009 5:06:40 PM by PJ-Comix
[ Post Reply | Private Reply | View Replies]

http://www.freerepublic.com/focus/f-news/2409901/posts

[CrackSmokeRepublican]

SCOTT ROTHSTEIN'S FIRM
Feds pursue more lawyers, campaign violation links in Scott Rothstein case

Federal investigators are scrutinizing the records of Scott Rothstein's former employees -- who gave about $2.2 million to political candidates -- for potential campaign finance and other violations.

Attorneys react to Rothstein arrest

Rothstein's attorney, Marc Nurik addressed the media following the not guilty plea and the U.S. Attorney held a press conference to discuss the case.

Miami Herald Staff


Attorney Kendall Coffey gave the news media a tour of the law offices Scott Rothstein shares with his partners. Rothstein has been accused of massive fraud, involving hundreds of millions of dollars.
WFSL/Sun-Sentinel

Attorneys react to Rothstein arrest
Rothstein's attorney, Marc Nurik addressed the media following the not guilty plea and the U.S. Attorney held a press conference to discuss the case.


Miami Herald Staff

    * Attorneys react to Rothstein arrest
    * A video tour of Scott Rothstein's office
    * Feds seize Scott Rothstein's property

Related Content

    * Defense in murder trial wants to speak to Scott Rothstein
    * Feds swoop into Tallahassee over fraud
    * Feds query legislators about indicted political player Alan Mendelsohn
    * Scott Rothstein partner denies earning $6M
    * Billionaire sex offender says he's a victim of Scott Rothstein
    * Scott Rothstein law partner: I didn't earn $6 million
    * Feds: Scott Rothstein showered police with `gratuities'
    * Army of lawyers picking over remains of Rothstein law firm
    * Scott Rothstein paid himself $35 million last year
    * Hedge funds sank $775 million into Rothstein scheme

BY JAY WEAVER, AMY SHERMAN AND MARC CAPUTO
http://www.miamiherald.com/news/legisla ... 90992.html

[CrackSmokeRepublican]

Chabad Invokes "Clergy Privilege" in Rothstein Ponzi Investigation


Ponzi schemer Scott W. Rothstein's former chabad, the Chabad of Downtown Inc. in Fort Lauderdale, is invoking "clergy privilege" in bankruptcy investigations.

Chabad is a term for a Jewish center run by a strictly orthodox Jewish organization.

This particular chabad, run by Rabbi Schneur Kaplan, was once so connected to Rothstein that its new building on Broward Boulevard carried Rothstein's name on the outside.

Attorneys for Rothstein's former law firm, led by trustee Herbert Stettin, are trying to determine where the proceeds of Rothstein's $1.2 billion Ponzi scheme went. One of the groups they want to investigate is the Chabad of Downtown.

Stettin's investigators have asked the chabad and dozens of other groups and people to sit for depositions or exams in the bankruptcy. In their notices to the bankruptcy court, they include broadly worded requests for records of "any and all communications" between the target and Rothstein.

Stettin's investigators even asked the chabad to produce a list of everyone who donated to it since 2007.

That was overly broad, the chabad's attorney, Reggie David Sanger, wrote in a motion for a protective order against the probe.

"Certain communications requested ... may also fall within the clergyman penitent privilege applicable under federal law," Sanger wrote.

Here, I am left wondering: Did Rothstein confess to the rabbi that he was running a Ponzi scheme, or other incriminating evidence? And, why would that matter, because Rothstein has already pleaded guilty.

Regardless, Sanger seems to have a point that the trustee's request is broad.

U.S. Bankruptcy Judge Raymond Ray has set a hearing on Sanger's motion for April 7 at 1:30 p.m.

http://wakeupfromyourslumber.com/blog/a ... estigation
http://www.bizjournals.com/southflorida ... ilege.html