Florida Ponzi lawyer: partners involved in scam

MIAMI (AP) — The former Florida lawyer convicted of running a $1.2 billion Ponzi scheme claims both his partners at a now-defunct Fort Lauderdale law firm knew about and profited from the illegal activity, according to transcripts of testimony released Wednesday.

The disbarred attorney, Scott Rothstein, said in a sworn deposition that ex-partners Russell Adler and Stuart Rosenfeldt knew about and benefited financially from the Ponzi scam that collapsed in fall 2009. The scam involved investments in fake legal settlements.

"If you're asking me if they knew that there were illegal activities going on in the law firm, the answer is yes," Rothstein said. "They knew that we were moving money illegally in and out of the law firm."

Rothstein, 49, is testifying behind closed doors through Friday in several civil lawsuits arising from the implosion of his Ponzi scheme and bankruptcy of the once high-flying law firm Rothstein Rosenfeldt Adler. The transcript released Wednesday was from the first day of his unusual two-week deposition, which began Dec. 12.

Rothstein is serving a 50-year prison sentence after pleading guilty to operating the scheme, a sentence he hopes to get reduced by cooperating in the ongoing criminal probe and civil lawsuits. Both Adler and Rosenfeldt are under criminal investigation, and attorneys representing them denied Rothstein's claims about their involvement in the scam.

"Mr. Rosenfeldt knew nothing of the illegal activities by Mr. Rothstein," said Rosenfeldt's attorney, Bruce Lehr.

Added Adler lawyer Fred Haddad: "We would expect Mr. Rothstein to say whatever he has to say to get out of prison in his lifetime."

Haddad also said a document connected to the scheme that appears to contain Adler's signature is a forgery. Rothstein has admitted forging the signatures of at least two federal judges on other documents.

Rothstein, however, said in his deposition he has nothing to gain by lying.

"I would be a fool to lie. I risk dying in prison if I lie. Okay? I have no intention of dying in prison," he said.

Rothstein named other people at his former firm who were supposedly involved in various aspects of the Ponzi scheme, while many others were not. So far, counting Rothstein, eight people have been indicted, and more charges are expected in the coming months.

The scam arose from a series of bridge loans Rothstein said he needed to support the law firm.

"Simply put, it took on a life of its own," he said.

Asked why, he replied simply: "Greed."

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