By Jon Burstein, Sun Sentinel
8:17 PM EST, December 23, 2011
Convicted fraudster Scott Rothstein said he paid off law enforcement officers, judges and local politicians as he handed off about $1 million in bribes, according to attorneys who sat through his extraordinary testimony the past two weeks.
"We were involved in public corruption with politicians," said Rothstein in transcripts of his Dec. 14 testimony released early Friday evening. "We were involved in public corruption with law enforcement. We were involved in activities with mob-related individuals. We were involved in activities involving the physical threats of other individuals. We were involved in the public corruption side of purchasing of political positions. We were involved in the manipulation of the judiciary."
But when it came to Rothstein naming those public officials who fell under his sway or detailing mob activities, a federal prosecutor sitting through the deposition prevented the disbarred attorney from answering the questions. That could be an indication that federal authorities believed Rothstein's answers could jeopardize ongoing investigations, according to Robert Jarvis, a law professor at Nova Southeastern University.
Rothstein wrapped up what been called "The Big Deposition" early Friday afternoon, having spent 10 days behind closed doors in a Miami federal courtroom answering questions from more than 30 attorneys. Those attorneys are involved in an array of litigation arising from the bankruptcy of Rothstein's shuttered law firm, Rothstein Rosenfeldt Adler, and various lawsuits filed by investors.
Attorneys who participated in the questioning fell in two distinct camps: those who believe Rothstein is coming clean and those who say it's just more lies from an accomplished con man seeking to get his 50-year prison sentence reduced.
Rothstein, 49, pleaded guilty in 2010 to five felony charges arising from his $1.4 billion Ponzi scheme, the largest financial fraud in South Florida history.
Until the past two weeks, his whereabouts had been unknown for months. Ever since it was revealed that he worked as a federal informant to sting an alleged Mafioso, he has been in a witness protection program within the federal prison system, his location a tightly held secret.
A common theme that emerged in the first three days of testimony released so far was how Rothstein gathered investors and seduced people to do his bidding by offering them "a rock star lifestyle" or what he also called "the Rothstein lifestyle."
"In its simplest terms, it is the ability to do whatever you want whenever you want, wherever you want by whatever means you can think of," said Rothstein in describing it. "Chartering jets, not waiting in lines at any restaurant or any club, wearing the most expensive clothes, having access to the best clothiers, the best shoemakers, having access to the finest jewelry."
Rothstein said he would have "boys' night out," where a group would head to a local strip club and have sex with prostitutes.
He estimated that over the course of the four-year fraud, he blew through up to $150 million covering his personal expenses alone. Beyond the decadent lifestyle, he said he cultivated relationships with politicians to further cement his reputation.
“The perception of power yields actual power,” he said. “It’s the closeness to these individuals, the ability to actually call them…It was the ability, for example, to be sitting in my office and contact the governor with a potential investor sitting in the office, just to chat or be able to have the governor call you when an important investor was in the room just to chat.”
Starting in 2006, Rothstein became a major player in the political fundraising world with nearly $3 million in contributions flowing from him, his law firm and his employees to federal, state and local races. He was named a delegate to the 2008 Republican National Convention and was appointed to a panel that picks the judges who sit on the 4th District Court of Appeal in West Palm Beach.
One wall of Rothstein's law firm was lined with photos of the sharp-dressed attorney with an array of politicians, including numerous pictures of him with former Gov. Charlie Crist.
And when it came to how he avoided scrutiny by law enforcement, he offered a simple answer.
"I utilized law enforcement itself," he said in the transcripts released Wednesday. He did not elaborate.
Rothstein had around-the-clock, off-duty police details at his Fort Lauderdale mansion. Rothstein made a great show of touting his law enforcement connections within the Broward Sheriff's Office and Fort Lauderdale Police Department.
William Scherer, an attorney representing investors claiming losses of more than $100 million, said Rothstein became "the great corrupter of our community."
"I'm saddened by what I heard about our town, our community, our local officials, our profession and our judiciary," Scherer said.
But Scherer said he found Rothstein's testimony to be believable and much of what was said is corroborated by mountains of documents in the case.
Sam Rabin, a defense attorney representing a former bank official implicated by Rothstein, described the deposition as another performance by "a master con man."
"He is a skilled liar and manipulator," said Rabin, who represents former TD Bank officer Frank Spinosa. "He's hurt a lot of people in the past and if the government permits it, he's going to hurt a lot of people in the future."
The transcripts of Rothstein's final seven days of testimony will be released over the next two weeks. Attorneys said Rothstein goes into even more detail about his activities, including who within his circle had sex with escorts.
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