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Ft. Lauderdale Lawyer Pleads Guilty in Federal Court

January 28, 2010

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Posted on Jan 28, 2010 12:00am PST
The day that South Florida has been waiting for finally came. Infamous Broward County lawyer Scott Rothstein entered a guilty plea in federal court for operating a massive 'Ponzi" scheme. Rothstein appeared before a United States District Judge and pled guilty to conspiracy to commit money laundering, conspiracy to commit wire fraud and mail fraud and wire fraud. As part of his plea agreement, he agreed to an asset forfeiture of $1.2 billion, 24 pieces of real estate, expensive car, boats, jewelry and bank accounts. Rothstein appeared unshaken as he entered the guilty plea with the assistance of his Miami criminal attorney.

Rothstein was accused of operated a large scheme to defraud investors. In some instances, he received money from investors promising that the money would be lent to clients in the form of bridge loans that would yield a hefty return. Other investors gave money to Rothstein thinking they were buying civil case settlements. The investors were told that they would purchase the settlements at a discount to be repaid over time as at full face value. In both cases, the investments never existed and money invested from new investors was paid to older investors. The four year fraud used numerous bank accounts to facilitate the complex money laundering scheme.

Rothstein is scheduled to appear back in federal court on May 6th for his sentencing hearing. Based on the charges he pled guilty to, he is facing up to 100 years in prison. Most experts believe his sentence will range from 20 to 30 years. According to the special agent in charge of the investigation, "Scott Rothstein used a classic approach to mislead investors - an ostentatious lifestyle, personality and guarantees of sky-high returns-all red flags in the world of Ponzi schemes." Investors became suspicious late last year when they stopped receiving scheduled returns on their investments. Panic followed, which led to the inevitable dissolution of his 70 person law firm in Ft. Lauderdale.

Now that Rothstein has entered a guilty plea, there is no doubt that federal law enforcement agencies and prosecutors will target others purportedly involved in the scheme. Court documents revealed that other members of the now disbanded law firm have criminal culpability for their involvement with Rothstein. Many of those suspected of being involved have retained Broward and Miami criminal attorneys should the hammer fall. Among those being looked at by investigators include Stuart Rosenfeldt and Russell Adler, Rothstein's former law partners and David Boden, Rothstein's former chief counsel. Anyone indicted in the case will face the similar charges of money laundering, wire fraud and mail fraud. If sentences are imposed against any of these individuals, they are not likely to exceed that Rothstein receives in May in light of the fact that he appears to be the mastermind behind the scheme.

Fort Lauderdale Attorney Pleads Guilty in Billion Dollar Ponzi Scheme, PR Newswire, January 27, 2010.
Categories: Federal Crimes
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