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Rothstein Fallout¶
Prosecutors outline restitution plan for Ponzi victims¶
August 02, 2010¶
Federal prosecutors have outlined their restitution plan in Scott Rothstein’s criminal case for 218 victims of his Ponzi fraud, saying they have legitimate claims totaling $188 million.¶
By: John Pacenti¶
The recovery percentage remains to be seen as the government culls what is left of the one-time power broker’s fallen empire through confiscated cash and the sale of homes, cars, boats, jewelry and other luxury items.¶
U. S. District Judge James I. Cohn in Fort Lauderdale has set an Aug. 30 deadline for the restitution to victims of the $1.2 billion Ponzi scheme. Rothstein is serving a 50-year prison sentence.¶
The government is certain to have far less than $188 million to distribute, officials said.¶
Herbert Stettin, the court-appointed trustee for Rothstein’s defunct Fort Lauderdale law firm, has criticized the government for insisting it be the main distributor of funds rather than the bankruptcy court.¶
Attorney Paul Singerman, a Berger Singerman partner representing Stettin, said he wants to study the filing and exhibits. He said the trustee already has spent countless hours going over claims.¶
“I will be very interested to see the government’s methodology,” he said.¶
More people with legitimate claims may be added to the list, but prosecutors have excluded 97 people seeking restitution.¶
Restitution will be made through a cash-in/cash-out methodology accounting for investments and supposed earnings during the course of the fraud.¶
John Pacenti can be reached at (305) 347-6638.¶
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8/3/2010¶