EFTA00596488

EXHIBIT A EFTA00596488 IN THE CIRCUIT COURT OF THE FIFTEENTH JUDICIAL CIRCUIT IN AND FOR PALM BEACH COUNTY, FLORIDA JEFFREY EPSTEIN, Complex Litigation, Fla. R. Civ. Pro. 1.201 CASE NO. \MCCOMB v. Plaintiff, 50 2009 CA 0 h 03 SCOTT ROTHSTEIN, individually, BRADLEY J. EDWARDS, individually, and COPY L.M., individually, RECEIVED FOR FILING Defendants. oic 0 1Mg EMIVIONIt PUCK COMPLAINT GlAilit QQMPTR9 66011 PINWIT CIVIk,P1\1 1algi Plaintiff, JEFFREY EPSTEIN, (hereinafter "EPSTEIN"), by and through his undersigned attorneys, files this action against Defendants, SCOTT ROTHSTEIN, individually, BRADLEY J. EDWARDS, individually, and L.M., individually. Accordingly, EPSTEIN states: SUMMARY OF ACTION Attorney Scott Rothstein aided by other lawyers and employees at the firm of Rothstein, Rosenfeldt, and Adler, P.A. for personal greed and enrichment, in betrayal of the ethical, legal and fiduciary duties to their own clients and professional obligations to the administration of justice, deliberately engaged in a pattern of racketeering that involved a staggering series of gravely serious obstructions of justice, actionable frauds, and the orchestration and conducting of egregious civil litigation abuses that resulted in profoundly serious injury to Jeffrey Epstein one of several targets of their misconduct EFTA00596489 Epstein v. RRA, et al. Page 2 and others. Rothstein and RRA's fraud had no boundary; Rothstein and his co- conspirators forged Federal court orders and opinions. Amongst the violations of law that are the subject of this lawsuit are the marketing of non-existent Epstein settlements and the sanctioning of a series of depositions that were unrelated to any principled litigation purpose but instead designed to discover extraneous private information about Epstein or his personal and business associates (including well-known public figures) in order to defraud investors and support extortionate demands for payment from Epstein. The misconduct featured the filing of legal motions and the pursuit of a civil litigation strategy that was unrelated to the merits or value of their clients' cases and, instead, had as its improper purpose the furthering of Rothstein's misrepresentations and deceit to third party investors. As a result, Epstein was subject to abusive investigatory tactics, unprincipled media attacks, and unsupportable legal filings. This lawsuit is filed and will be vigorously pursued against all these defendants. The Rothstein racketeering enterprise endeavored to compromise the core values of both state and federal justice systems in South Florida and to vindicate the hardworking and honest lawyers and their clients who were adversely affected by the misconduct that is the subject of this Complaint. Plaintiff reserves the right to add additional defendants — co-conspirators as the facts and evidence is developed. GENERAL ALLEGATONS 1. This is an action for damages in excess of $15,000.00, exclusive costs, interest, and attorneys' fees. EFTA00596490 Epstein v. RRA, et al. Page 3 ing and works in Palm Beach 2. Plaintiff, EPSTEIN, is an adult and currently is resid County, Florida. , is an individual residing in 3. Defendant, SCOTT ROTHSTEIN ("ROTHSTEIN") in the State of Florida. In Broward County, Florida, and was licensed to practice law license in the midst of the November 2009, ROTHSTEIN voluntarily relinquished his law A"). He was disbarred by the implosion of Rothstein, Rosenfeldt and Adler, P.A. ("RR mber 1, 2009, ROTHSTEIN Florida Supreme Court on November 20, 2009. On Dece County, Florida. was arrested and arraigned in Federal Court in Broward ging partner and CEO of 4. At all times relevant hereto, ROTHSTEIN was the mana RRA. and were the principal 5. Defendant, ROTHSTEIN and Stuart Rosenfeldt, are owners of equity in RRA and each co-founded RRA. an individual residing in 6. Defendant, BRADLEY J. EDWARDS ("EDWARDS"), is the State of Florida. At all Broward County, Florida and is licensed to practice law in agent, associate, partner, times relevant hereto, EDWARDS was an employee, shareholder, and/or other representative of RRA. Beach County, Florida. 7. Defendant, L.M. ("L.M."), is an individual residing in Palm RRA, ROTHSTEIN and At all times relevant hereto, L.M. was represented by ntial participant in the EDWARDS in a civil lawsuit against Epstein and was an esse lly changing prior sworn scheme referenced infra by, among other things, substantia ulent scheme for the testimony, so as to assist the Defendants in promoting their fraud EFTA00596491 Epstein v. RRA, et al. Page 4 promise of a multi-million dollar recovery relative to the Civil Actions (defined below) involving Epstein, which was completely out of proportion to her alleged damages. 8. Non-party, RRA is a Florida Professional Service Corporation, with a principal address of 401 East Las Olas Blvd., Suite 1650, Fort Lauderdale, FL 33401. In addition to its principal office, RRA also maintained seven offices in Florida, New York, and Venezuela, and employed over 70 attorneys and 200 support staff. RRA also maintains an office at 1109 NE 2d Street, Hallendale Beach, Florida 33009-8515. RRA, through its attorneys, including those named as Defendants herein, conducted business throughout Florida, and relevant to this action, conducted business and filed lawsuits on behalf of clients in Palm Beach County, Florida. (RRA is currently a debtor in bankruptcy. RRA is not named as a Defendant). FACTUAL ALLEGATIONS 9. The United States in United States of America v. Scott W. Rothstein, Case No. 09-60331CR-Cohn, United States District Court, Southern District of Florida, has brought an action for Racketeering Conspiracy, 18 U.S.C. § 1962(d) against Scott W. Rothstein who was the chief executive officer and chairman of RRA. Within the information which was filed, the United States of America has identified the enterprise as being the law firm, RRA, through which Rothstein in conjunction with "his co- conspirators" (not yet identified by the USA) engaged in the pattern of racketeering through its base of operation at the offices of RRA from sometime in 2005 up through and continuing into November of 2009. Through various criminal activities, including mail fraud, wire fraud and money laundering, the United States of America asserts that EFTA00596492 Epstein v. RRA, et at Page 5 Rothstein and his co-conspirators unlawfully obtained approximately $1.2 billion from investors by fraud in connection with a Ponzi scheme. The USA further alleges that "Rothstein and co-conspirators initiated the criminal conduct alleged in the instant Information in order to personally enrich themselves and to supplement the income and sustain the daily operation of RRA." In essence, in the absence of Rothstein and his co- conspirators conducting the Ponzi scheme, the daily operation of RRA, which included payroll (compensation to lawyers, staff, investigators, etc.), accounts payable including unlimited improper, harassing and potential illegal investigation on cases, including Epstein-related matters, would in all likelihood would not have been sustainable. A copy of the information is attached as Exhibit 1 to this action. 10. As more fully set forth herein, RRA held itself out as legitimately and properly engaging in the practice of law. In reality, ROTHSTEIN and others in RRA were using RRA to market investments, as described below, so as to bilk investors out of hundreds of millions of dollars. ROTHSTEIN and others in RRA devised an elaborate plan through which were sold purported confidential assignments of a structured pay-out settlements, supposedly reached on behalf of RRA for clients, in exchange for immediate payments to these clients of a discounted lump sum amount. Investors were being promised in excess of a 30% return on their investment which was to be paid out to the investors over time. While some of the cases relied upon to induce investor funding were existing filed cases, it is believed that the confidential, structured pay-out settlements were all fabricated. EFTA00596493 Epstein v. RRA, et al. Page 6 11. Based on media reports, Federal Bureau of Investigation (FBI) press conferences and releases and the Information the massive Ponzi scheme and pattern of criminal activity meant to lure investors began sometime in 2005 and continued through the fall of 2009, when the scheme was uncovered by some of the investors and the FBI. As of November of 2009, civil lawsuits were and continue to be filed against various Defendants as result of their massive fraudulent and criminal scheme. 12. This fraudulent and illegal investment scheme is also evidenced by the filing of Amended Complaint For Dissolution And For Emergency Transfer of Corporate Powers to Stuart A. Rosenfeldt, Or, In The Alternative, For the Appointment of A Custodian or Receiver by ROSENFELDT, and RRA, against ROTHSTEIN, individually. (Case No. 09 059301, In the Circuit Court of the Seventeenth Judicial Circuit, Broward County, Florida, Complex Business Div.), (hereinafter "RRA dissolution action, and attached hereto as Exhibit 2). 13. Plaintiff references the RRA dissolution action for the sole purpose that it acknowledges that RRA and ROTHSTEIN were in fact conducting an illegal and improper investment or Ponzi scheme based on promises of financial returns from settlements or outcomes of supposed legal actions, including the actions brought against Plaintiff EPSTEIN. The RRA dissolution action alleges in part that — "ROTHSTEIN, the managing partner and CEO of the firm (RRA), has, according to assertions of certain investors, allegedly orchestrated a substantial misappropriation of funds from investor trust accounts that made use of the law firm's name (RRA). The investment business created and operated by ROTHSTEIN centered around the sale of EFTA00596494 Epstein v. RRA, et al. Page 7 ment of RRA dissolution interests in structured settlements." See Preliminary State action, Exhibit 2 hereto. used in communications 14. In furtherance of the scheme, RRA's letterhead was settlements. RFtA's trust regarding investment opportunities in purported structured rs or wire transfer of monies account was used to deposit hundreds of millions of dolla guaranteed payments. from duped investors and other victims. RRA personally and fraudulent Court 15. Rothstein's scheme went so far as to manufacture false District Judge, Kenneth A. opinions/orders including forging the signatures of U.S. it in other cases. It is not Marra and U.S. Circuit Court Judge, Susan H. Black, 11th Circu d matters. See Composite yet known if he forged similar documents in Esptein relate Exhibit 3 hereto. led on a daily basis through 16. The details of this fraudulent scheme are being revea t estimate of the financial various media reports and court documents. The most recen rs. scope of the scheme is that it exceeds $1.2 billion dolla a defendant in three civil 17. Relevant to this action, EPSTEIN is currently named as handled by RRA and its actions alleging, inter alia, sexual assault and battery that were of which is filed in federal attorneys including EDWARDS prior to its implosion - one .C. S.D. Fla.)(Jane Doe is a court (Jane Doe v. Epstein, Case No. 08-CIV-80893, U.S.D filed in state court in the 15th named Defendant herein), and two of which have been (L.M. v. Epstein, Case No. Judicial Circuit Court, Palm Beach County, State of Florida, 502008CA028058XXXXMB 502008CA028051XXXXMB AB; E.W. v. Epstein, Case No. EFTA00596495 Epstein v. RRA, et al. Page 8 Actions," and L.M is a named AB), (hereinafter collectively referred to as the "Civil st and September of 2008. Defendant herein). The Civil Actions were all filed in Augu investment or Ponzi scheme was 18. What is clear is that a fraudulent and improper in of the named Defendants, which in fact conducted and operated by RRA and certa dant in the Civil Actions. scheme directly impacted EPSTEIN as a named defen quoted in a November 2009 19. Miami attorney and developer, Alan Sakowitz, was a potential investor in August of article as saying that he had met with ROTHSTEIN as it was all a Ponzi scheme 2009, but became suspicious. He stated "I was convinced was hiding behind a legitimate and I notified the FBI in detail how Scotty ROTHSTEIN witz was also quoted as saying law firm to peddle fake investments." Attorney Sako and former law enforcement ROTHSTEIN had sophisticated eavesdropping equipment ' garbage looking for damaging officers who would sift through a potential defendants defendants could be in essence evidence to use with investors to show how potential the value of any legitimate blackmailed into paying settlement that far exceeded damage claim. multiple Rothstein related 20. Ft. Lauderdale attorney William Scherer represents used the "Epstein Ploy ... investors. He indicated in an article that RRA/Rothstein had money. He would use. . .cases as a showpiece as bait. That's the way he raised all the s he allegedly structured as bait for luring investors into fictional cases. All the case ." In fact, on November 20, were fictional. I don't believe there was a real one in there a 147 page Complaint against 2009, William Scherer, on behalf of certain clients, filed Barnett, TD Bank, N.A., Frank ROTHSTEIN, David Boden, Debra Villegas, Andrew EFTA00596496 Epstein v. RRA, et al. Page 9 Preve asserting various Spinosa, Jennifer Kerstetter, Rosanne Caretsky and Frank behind the RRA facade; and allegations that further prove the massive Ponzi scheme Complaint naming additional as of November 25, 2009, a 249 page Amended Defendants was filed. IN, David Boden, Debbie 21. In addition, and upon information and belief, ROTHSTE Jenne (all employees of RRA) Villegas, Andrew Bamett, Michael Fisten and Kenneth ings during which false through brokers or middlemen would stage regular meet nts that existed or RRA had statements were made about the number of cases/clie share actual case files against EPSTEIN and the value thereof. They would show and Thus, the attorneys and clients from the EPSTEIN actions with hedge fund managers. that otherwise may have have waived any attorney-client or work- product privileges existed. of the actual Civil Action 22. Because potential investors were given access to some name of an existing Plaintiff files, investor-third parties may have became aware of a sed disclosure of her legal who had filed anonymously against Epstein and had oppo name. ARDS claiming the need 23. In all other instances, by RRA, ROTHSTEIN and EDW able to effectively for anonymity with regard to existing or fabricated clients, they were was a key element in the use initials, Jane Doe or other anonymous designations which make the investors believe fraudulent scheme. Fictitious names could be created to many other cases existed against Epstein. EFTA00596497 Epstein v. RRA, et al. Page 10 represented by RRA and 24. In each of RRA's Civil Actions, the Plaintiffs are or were its attorneys, including ROTHSTEIN and EDWARDS. Civil Actions another fifty 25. In addition, investors were told that in addition to the , with the potential for hundreds (50) plus anonymous females were represented by RRA attorneys would sue Epstein of millions of dollars in settlements, and that RRA and its high-profile friends. unless he paid exorbitant-settlement amounts to protect his 26. Upon information and belief, EDWARDS knew or should have known that Ponzi scheme and/or were ROTHSTEIN was utilizing RRA as a front for the massive (and other claims) involving selling an alleged interest or investment in the Civil Actions Epstein. attorneys of RRA) knew 27. Further evidencing that EDWARDS (and possibly other on of the massive Ponzi or should have known and participated in the continuati mber 24, 2009, reported on scheme, a front-page Palm Beach Post article, dated Nove cutors against "dozens of the recent filing of an amended forfeiture complaint by prose urants and other assets — ROTHSTEIN's real estate properties, foreign cars, resta cco, along with millions more including $12 million in the lawyers bank account in Moro e further reported that - donated to political campaigns and charitable funds." The articl his massive Attorney Scott ROTHSTEIN tapped into millions of dollars from Fort Lauderdale investment scam to cover payroll costs at his expanding ay. law firm, federal authorities said in court records released Mond n in one ROTHSTEIN's law firm (RRA) generated revenue of $8 millio million, recent year, yet his 70-lawyer law firm had a payroll of $18 EFTA00596498 Epstein v. RRA, et al. Page 11 prosecutors said. ROTHSTEIN, who owned half of RRA used investors' money from his Ponzi scheme to make up the shortfall, they said. Subsequent articles and court filings have reflected ROTHSTEIN received compensation in excess of $35.7 million in 2008 and $10.5 million in 2009, while his partner Rosenfeldt received greater than $6 million in 2008. 28. ROTHSTEIN attempted to lure the entity known as D3 Capital Club, LLC, ("D3"), by offering D3 "the opportunity" to invest in a pre-suit $30,000,000.00 court settlement against EPSTEIN; yet this supposed settlement never existed and was entirely fabricated. To augment his concocted story, ROTHSTEIN, upon information and belief, invited D3 to his office to view thirteen (13) banker's boxes of case files in Jane Doe (one of the Civil Actions)' in an attempt to substantiate that the claims against EPSTEIN were legitimate and that the evidence obtained against him by RRA, ROTHSTEIN, and EDWARDS (the "Litigation Team") was real. 29. Upon information and belief, ROTHSTEIN and others offered other investors like the entity D3 fabricated investment opportunities in the Civil Actions involving EPSTEIN. Fisten (a former Dade County police officer with a questionable police record and RRA investigator) and Jenne (a former attorney, Broward County Sheriff and felon) assisted ROTHSTEIN in making these offers by providing confidential, privileged and work- product information to prospective third-party investors. It appears that 13 out of the 40 boxes seized by the FBI as part of its investigation at RRA consisted of files relating to the Civil Actions involving EPSTEIN, as reported by counsel for the Bankruptcy Trustee. Until those boxes can be reviewed, as well as other discovery, Epstein will not know the depth of the fraud and those involved. EFTA00596499 Epstein v. RRA, et al. Page 12 and fabricating settlements 30. By using the Civil Actions against EPSTEIN as "bait" able to lure investors into regarding same, ROTHSTEIN and others were which, in turn, was used to fund ROTHSTEIN'S lair and bilked them of millions of dollars continuing the massive Ponzi the litigation against EPSTEIN for the sole purpose of scheme. tion Team, individually and in 31. As part of this scheme, ROTHSTEIN and the Litiga a concerted effort, may have unethically and illegally: sale of an interest In non- a. Sold, allowed to be sold and/or assisted with the able and non- settled personal injury lawsuits (which are non-assign s (including those transferable) or sold non-existent structured settlement cases involving Epstein); non-lawyers; b. Reached agreements to share attorneys fees with Jane Doe) "up c. Used investor money to pay plaintiffs (i.e., L.M., E.W. and Civil Actions; front" money such that plaintiffs would refuse to settle the ions in violation of d. Conducted searches, wiretaps or intercepted conversat state or federal laws and Bar rules; and to, unreasonable and e. Utilized the judicial process including, but not limited ring the Ponzi unnecessary discovery, for the sole purpose of furthe scheme. eys, including the Litigation 32. Any such actions by ROTHSTEIN, and other attorn ion of various Florida Bar Rules, Team, directly or indirectly, would potentially be a violat EFTA00596500 Epstein v. RRA, et al. Page 13 various conflicts of issues including prohibiting the improper sharing of fees or costs and rules. have known of the improper 33. Evidencing that the Litigation Team knew or should continuation of the scheme, purpose that ROTHSTEIN was pursuing in the EIN cases to pursue issues and ROTHSTEIN used RRA's Litigation Team in the EPST s pled in the Civil Actions, but evidence unrelated to and unnecessary to the claim i scheme orchestrated by significantly beneficial to lure investors into the Ponz ROTHSTEIN and other co-conspirators. s claimed their investigators 34. Upon information and belief, ROTHSTEIN and other ard Epstein's private jet where discovered that there were high-profile individuals onbo others) copies of a flight log sexual assaults took place and showed D3 (and possibly and international figures. purportedly containing names of celebrities, dignitaries, ingly pursued flight data 35. For instance, the Litigation Team relentlessly and know with these famous individuals and passenger manifests regarding flights EPSTEIN took and no illicit activities took knowing full well that no underage women were onboard ropriately attempted to take the place. ROTHSTEIN and the Litigation Team also inapp bolster the marketing scam that depositions of these celebrities in a calculated effort to was taking place. of EPSTEIN'S pilots, and 36. One of Plaintiffs' counsel, EDWARDS, deposed three in Iraq). The pilots were sought the deposition of a fourth pilot (currently serving EDWARDS never asked one deposed by EDWARDS for over twelve (12) hours, and clients) as it related to question relating to or about E.W., L.M., and Jane Doe (RRA EFTA00596501 Epstein v. RRA, et al. Page 14 EIN'S planes. But EDWARDS transportation on flights of RRA clients on any of EPST tions about the pilots' thoughts asked many inflammatory and leading irrelevant ques could only have been asked and beliefs (which will never be admissible at trial) which by using the depositions to sell the for the purposes of "pumping" the cases and thus cases (or a part of them) to third parties. Epstein wanted to make 37. Because of these facts, ROTHSTEIN claimed that therefore he had offered certain none of these individuals would be deposed and various potential plaintiffs in $200,000,000.00 to settle the claims of RRA female clients r settlement by EPST EIN actions against EPSTEIN. The offer of a $200 million dolla made. was completely fabricated; no such offer had ever been he intended to take the 38. EDWARDS' office also notified Defendant that depositions of and was subpoenaing: l); (i) Donald Trump (real-estate magnate and business mogu nal attorney (ii) Alan Dershowitz (noted Harvard Law professor, constitutio and one of EPSTEIN'S criminal defense attorneys); (iii)Bill Clinton (Former President of the United States); (iv)Tommy Mottola (former President of Sony Record); and (v) David Copperfield (illusionist). aintances of EPSTEIN with 39. The above-named individuals were friends and acqu the years. None of the whom he knew through business or philanthropic work over er with any of the Litigation above-named individuals had any connection whatsoev Team's clients, E.W., L.M. or Jane Doe. EFTA00596502 Epstein v. RRA, et al. Page 15 40. EDWARDS filed amended answers to interrogatories in the state court matters, E.W. and L.M., and listed additional high profile witnesses that would allegedly be called at trial, including, but not limited to: (1) Bill Richardson (Governor of New Mexico, formerly U.S. Representative and Ambassador to the United Nations); and (ii) Any and all persons having knowledge of EPSTEIN'S charitable, political or other donations;2 41. The sole purpose of the scheduling of these depositions or listing high profile friends/acquaintances as potential witnesses was, again, to "pump' the cases to investors. There is no evidence to date that any of these individuals had or have any knowledge regarding RRA's Civil Actions. 42. In furtherance of their illegal and fraudulent scheme against EPSTEIN, ROTHSTEIN, EDWARDS (who either know or should have known) and, at times, L.M. in her Civil Action against EPSTEIN: a) Included claims for damages in Jane Doe's federal action in excess of $50,000,000.00 rather than simply alleging the jurisdictional limits. b) Organized a Jane Doe TV media interview without any legitimate legal purpose other than to "pump" the federal case for potential 2 These high-profile celebrity "purported" witnesses have no personal knowledge regarding the facts on these "Three Cases", but were being contacted, subpoenaed or listed to harass and intimidate them and Epstein, and to add "star appeal to the marketing effort of the Ponzi scheme. EFTA00596503 Epstein v. RRA, et al. Page 16 in Palm investors or to prejudice Epstein's right to a fair trial Beach County. named partner in c) EDWARDS, Berger and Russell Adler (another RRA) all attended EPSTEIN's deposition. At that time, had no outrageous questions were asked of EPSTEIN which could be bearing on the case, but so that the video and questions shown to investors. irrelevant d) Conducted and attempted to conduct completely Civil discovery unrelated to the claims in or subject matter of the witnesses Actions for the purpose of harassing and embarrassing thousands and EPSTEIN and causing EPSTEIN to spend tens of defending of dollars in unnecessary attorneys' fees and costs was what appeared to be discovery related to the Civil Actions but entirely related to the furtherance of the Ponzi scheme. the spring of e) After EDWARDS was recruited and joined RRA in against 2009, the tone and tenor of rhetoric directed to cases changed EPSTEIN used by Attorney EDWARDS and Berger from dramatically in addressing the court on various motions matory being substantive on the facts pled to ridiculously inflam when and sound-bite rich such as the July 31, 2009, transcript nce EDWARDS stated to the Court in E.W./L.M.: "What the evide as is really going to show is that Mr. Epstein — at least dating back EFTA00596504 Epstein v. RRA, et al. Page 17 itted, back to far as our investigation and resources have perm attempt to 1997 or '98 — has every single day of his life, made an we're not sexually abuse children. We're not talking about five, not talking talking about 20, we're not talking about 100, we're n to law about 400, which, I believe, is the number know . . and it enforcement, we are talking about thousands of children. ed is through a very intricate and complicated system that he devis h him that where he has as many as 20 people working underneat he is paying well to schedule these appointments, to locate these girls." legally f) As an example, EDWARDS filed an unsupportable and sfer of deficient Motion for Injunction Restraining Fraudulent Tran erty of Assets, Appointment of a Receiver to Take Charge of Prop ntial Epstein, and to Post a $15 million Bond to Secure Pote Judgment, in Jane Doe v. Epstein Case No. 08-CV-80893- the Marra/Johnson. The motion was reported in the press as was ultimate goal (i.e., to "pump" the cases for investor following). of However, the Court found "Plaintiffs motion entirely devoid evidence . . . ", and denied the motion in toto. he g) ROTHSTEIN told investors he had another 52 females that ve, represented, and that Epstein had offered $200 million to resol EFTA00596505 Epstein v. RRA, et al. Page 18 million, but that he could settle, confidently, these cases for $500 separate and apart from his legal fees. known h) ROTHSTEIN and the Litigation Team knew or should have al value that their three (3) filed cases were weak and had minim for the following reasons: (i) L.M. — testified she never had any type of sex with Epstein; worked at numerous strip clubs; is an admitted prostitute and call girl; has a history of illegal drug use (pot, painkillers, Xanax, Ecstasy); and continually asserted the 5th Amendment during her depositions in order to avoid answering relevant but problem questions for her; E.W. — testified she worked at eleven (11) separate strip clubs, including Cheetah which RRA represented and in which ROTHSTEIN may have owned an interest; and E.W. also worked at Platinum Showgirls in Boynton Beach, which was the subject of a recent police raid where dancers were allegedly selling prescription painkillers and drugs to customers and prostituting themselves. Jane Doe (federal case) seeks $50 million from Epstein. She and her attorneys claim severe EFTA00596506 Epstein v. RRA, et al. Page 19 emotional distress as a result of her having voluntarily gone to Epstein's home. She testified that there was never oral, and or sexual intercourse; nor did she ever touch his genitalia. Yet, Jane Doe suffered extreme emotional distress well prior to meeting Epstein as a result of having witnessed her father murder his girlfriend's son. She was required to give sworn testimony in that matter and has admitted that she has lied in sworn testimony. Jane Doe worked at two different strip clubs, including Platinum Showgirls in Boynton Beach. ridiculous and irrelevant discovery such as i) Conducted Leonard subpoenaing records from an alleged sex therapist, Dr. ted Bard in Massachusetts, when the alleged police report reflec named that EPSTEIN had only seen a chiropractor in Palm Beach alleged Dr. Bard. No records relating to EPSTEIN existed for this ds was sex therapist, Dr. Bard, and the alleged subpoena for recor tor appeal; just another mechanism to "pump" the cases for inves beha lf of j) Allowed a Second Amended Complaint to be filed on sex," yet L.M. alleging that EPSTEIN forced the minor into 'oral vaginal L.M. testified that she never engaged in oral, anal, or EFTA00596507 Epstein v. RRA, et al. Page 20 intercourse with EPSTEIN and she had never touched his genitalia. k) Told investors, as reported in an Associated Press article, that celebrities and other famous people had flown on EPSTEIN'S plane when assaults took place. Therefore, even though none (zero) of RRA's clients claim they flew of EPSTEIN'S planes, the Litigation Team sought pilot and plane logs. Why? Again, to prime the investment "pump" with new money without any relevance to the existing claims made by the RRA clients. I) After EDWARDS joined RRA, EDWARDS and former Circuit Judge William Berger filed and argued motion to make the Non- Prosecution Agreement (NPA) between Epstein and USAO public. But, RRA, EDWARDS and Berger, and their three clients, already had a copy of the NPA. They knew what it said and they knew the civil provisions in the agreement had no impact whatsoever on the three pending Civil Actions. The concept behind certain civil provisions in the NPA was to allow an alleged victim to resolve a civil claim with Epstein, maintain her complete privacy and anonymity and move on with her life. As an assistant United States Attorney stated at a hearing in federal court, the NPA was not designed "to hand them a jackpot or a key to a bank." EFTA00596508 Epstein v. RRA, et al. Page 21 to magnify his financial gain 43. ROTHSTEIN, with the intent and improper motive tment and/or Ponzi scheme, had so continue to fund the fraudulent and illegal inves the Civil Actions. EDWARDS demand excessive money from EPSTEIN in had no legitimate purpose in 44. The actions described in paragraph 42 above herein r were meant to further the pursuing the Civil Actions against EPSTEIN, but rathe IN so that he and others could fraudulent scheme and criminal activity of ROTHSTE ng and non-existent claims fraudulently overvalue the settlement value of the existi against EPSTEIN to potential investors. me, RRA and its 45. As a result of the fraudulent investment or (Ponzi) sche have compromised their clients' attorneys in the Civil Actions against EPSTEIN may have been unable to give interests. ROTHSTEIN and the Litigation Team would had been promised a financial unbiased legal counsel because outside investor(s) tiff received payments from interest in the outcome of the actions. Additionally, if a plain ly could impact the plaintiff's investment monies while her action is pending, this clear or shade their testimony (i.e. decision of whether or not to settle the current litigation to further promote the commit perjury) to gain the greatest return on the investment and Ponzi Scheme. L.M.'s state civil 46. The truthfulness of L.M.'s allegations and testimony in seek a multi-million dollar action have been severely compromised by the need to us settlements of tens of payout to help maintain RRA's massive fraud. Because fictitio sented to "investors" in this millions of dollars in cases relating to EPSTEIN were repre ed to create a fiction that Ponzi scheme, RRA and the attorneys in the Civil Actions need EFTA00596509 Epstein v. RRA, et at Page 22 l facts behind her action would included extraordinary damages. However, the actua ordinary measures were never support such extraordinary damages. Therefore, extra against EPSTEIN. undertaken to create an entirely inflated value of her claims she admitted to having a. Though she held herself out as a "victim" of Epstein, of abuse. She returned over and over again to him despite her current claim since the age of 15. has now admitted, under oath, to being a call girl/escort 280:16-19). She (in her deposition September 24, 2009 Transcript "DT" ) and "I am a testified 'Well, I lived life as a prostitute," (see DT 156:7 L.M. admitted her prostitute when I make money" (see DT 156:12-13). from prostitution activity with men other than Epstein to making $1,000 a day 157:11-158:21). on maybe more than 20 occasions in one year alone (DT she collected from L.M. admitted under oath to keeping a list of amounts "Psalms" that she "Johns" in "two or three" lined books including a book of circumstances, her obtained from a religious store (DT 152:1-14). Under the "Johns" during that claim for damages against EPSTEIN, one of L.M.'s many to produce the same period, would be so incredible and certainly not likely extraordinary settlements promised to "RRA's investors." and RRA, L.M. 47. In April 2007, before she was represented by EDWARDS, FBI. She was represented gave sworn taped recorded testimony to the agents of the e of EPSTEIN in a very by a lawyer other than EDWARDS at that statement. She spok central allegations on which positive and friendly terms and directly contradicted the L.M.'s civil action against Epstein is now based. However, once in the hands of EFTA00596510 Epstein v. RRA, et al. Page 23 All of a sudden she wanted to EDWARDS and RRA, L.M.'s story changed dramatically. of millions of dollars. sue EPSTEIN and like other RRA clients, sought tens was insistent that a. For example, in her sworn statement to the FBI, L.M. conclusion of she "Jeffrey is an awesome man." (p. 21 — FBI); At the because he's an stated: "I hope Jeffrey, nothing happens to Jeffrey shame that he has to awesome man and it really would be a shame. It's a t do nothing go through this because he's an awesome guy and he didn' wrong, nothing." (pp. 57-58 - FBI). In fact, L.M. spoke so highly of ney's office EPSTEIN and her interactions with him that the US Attor ney could not informed a federal court in July 2008 that the US Attor consider L.M. a victim. n her Yet, by September 24, 2009, the date on which L.M. bega d by RRA and deposition in her civil action and now represente rted sexual EDWARDS, L.M.'s new and very different tale about purpo EIN had been misconduct under the supposed influence of EPST HSTEIN scam was thoroughly rehearsed and her role into the ROT that: complete. In her deposition in her civil action, L.M. declared "I, I don't really care about money." (DT 206:8) right for "He needs time in jail. He doesn't want to be — this is not him to be on the streets living daily . . ." (DT 219:21-23) EFTA00596511 Epstein v. RRA, et al. Page 24 because of "You don't think my whole life I have lived that shifty life Jeffrey Epstein?" (DT 222:7-8) ), L.M. was b. In her sworn FBI testimony (pre-EDWARDS and RRA ved no inappropriate emphatic that her interactions with Epstein invol site: sexual touching in any way. In fact, it was exactly the oppo any kind of O: Did he at any point kiss you, touch you, show affection towards you? A: Never, never. (p. 21 - FBI) . . . Q: So he never pulled you closer to him in a sexual way? y is an A: I wish. No, no, never, ever, ever, no, never. Jeffre awesome man, no. (p. 21 - FBI) 2009, Yet, L.M. filed her second amended complaint in April EPSTEIN in after EDWARDS joined RRA, the allegations against raph 12 of L.M.'s complaint became even more salacious. In parag g other L.M.'s Second Amended Complaint, L.M. alleges amon things, that: minor "Jeffrey Epstein coerced, induced, or enticed . . .the then These acts Plaintiff to commit various acts of sexual misconduct. te and included, but were not limited to, fondling and inappropria or inducing illegal sexual touching of the then minor Plaintiff, forcing ct..." the then minor plaintiff into oral sex or other sexual miscondu EFTA00596512 Epstein v. RRA, et al. Page 25 L.M. testified that c. In her sworn FBI statement (pre-EDWARDS and RRA), the individual who first brought L.M. to EPSTEIN's doesn't want any home, told L.M. "make sure you're 18 because Jeffrey underage girls? (p. 8 - FBI). sented by Yet at her September, 2009 deposition now repre EDWARDS and RRA, L.M. told a very different story: Mr. Epstein Q: My question was what did Carolyn tell you to tell about your age? A: She said it didn't matter. Q: That's your recollection about what she said? r. Don't A: Yes, she said — I remember her saying it doesn't matte worry about it. (DT 199:20-25) s made d. Pre-EDWARDS and RRA, L.M. testified to the FBI : "I alway - FBI). sure — I had a fake ID, anyways saying that I was 18." (p. 8 2009 depo, she Yet, when questioned about her fake ID at her September stated: Q: And did you have a fake ID? A: No. Q: Have you ever had a fake ID? EFTA00596513 Epstein v. RRA, et al. Page 26 A: No. (DT 300:5-8) ied e. In her FBI statement (pre-EDWARDS and RRA), L.M. testif ied that women she about others L.M. brought to the Epstein home. L.M. testif and content with their brought to EPSTEIN's home were eager for the opportunity experiences: 'd A: None of my girls ever had a problem and they'd call me. They use they beg me, you know, for us to go to Jeffrey's house beca , and love Jeffrey. Jeffrey is a respectful man. He really is. I mean about he all thought we were of age always. This is what's so sad it. (p 30 - FBI). left Q: Did any of the girls complain about what happened after they there? y. A: No. You asked me that question. No, everybody loved Jeffre (p. 44 - FBI) with A: Every girl that I brought to Jeffrey, they said they were fine ts in the it. and like for example [E.W. — another of RRA's clien the Civil Actions], a lot of girls begged me to bring them back for FBI) money. And as far as I know, we all had fun there. (p. 45 - EFTA00596514 Epstein v. RRA, et al. Page 27 did a "180" at her Yet, with EDWARDS and RRA as her attorneys, L.M. September, 2009 deposition in saying: mind. A: . . . Once they were there, they were scared out of their said L.M. They did it anyways and some of them walked out and ever don't ever do this to me again. That was the worst thing that happened to me. (DT 170:6-11) 3) . . . A: And then, a lot of girls weren't comfortable. (DT 171:1 L.M. made f. The above represent only a few of the dramatic changes S/RRA and after she in her testimony prior to her representation by EDWARD hired ROTHSTEIN, EDWARDS and RRA. me, L.M. may knowingly 48. As a result of the fraudulent investment or (Ponzi) sche or committed a fraud on the have compromised her alleged interests in her Civil Action, court. n set of facts involving 49. RRA and the Litigation Team took an emotionally drive Palm Beach Billionaire and alleged innocent, unsuspecting, underage females and a ving the cases based sought to turn it into a gold mine. Rather than evaluating and resol voluntary and consensual on the merits (i.e. facts) which included knowledgeable, pstein psychological and actions by each of the claimants and substantial pre-E l sexual experiences pre- emotional conditions of each of the claimants and substantia orders and objections Epstein, RRA and the Litigation Team sought through protective ad forged ahead with to block relevant discovery regarding their claimants. They inste in into settling the cases. discovery the main purpose of which was to pressure Epste EFTA00596515 Epstein v. RRA, et al. Page 28 Fortunately, their tactics have not been successful. As Magistrate Judge Linnea 2009 (DE 299 in Federal Case Johnson wrote in a discovery order dated September 15, r: #08-80119) in denying Plaintiffs' Motion for Protective Orde clear that the childhood of "This is his [Epstein's] right. The Record in this case is and neglect, which in many of the Plaintiffs was marred by instances of abuse ges claimed by the turn may have resulted, in whole or in part, in the dama Plaintiffs." 2009 (DE 377 in Federal In addition, in an Omnibus Order dated October 28, Case #08-80119) Magistrate Judge Linnea Johnson wrote: Plaintiff's damage claims, "Here the request at issue goes to the very heart of the sexual history, but requesting not only general information relating to Plaintiff's ved compensation or inquiring as to specific instances wherein Plaintiff recei ulted, battered, or consideration for sex acts, claim other males sexually assa lascivious acts on her. abuses her, and/or claim other mates committed lewd or their sexual history As a global matter, Plaintiffs clearly and unequivocally place case has negatively in issue by their allegations that Epstein's actions in this ust in men," "sexual affected their relationships by, among other things, "distr problems in personal intimacy problems," "diminished trust," "social problems," " teenage pregnancy," relationships,' " feeling of stress around men," "premature Considering these "antisocial behaviors," and "hyper-sexuality and promiscuity." is entitled to know allegation, there simply can be no question that Epstein al activity" or "lewd whether Plaintiffs were molested or the subject of other "sexu EFTA00596516 Epstein v. RRA, et al. Page 29 and lascivious conduct" in order to determine whether there is an alternative basis for the psychological disorders Plaintiffs claim to have sustained, whether Plaintiffs engaged in prostitution or other similar type ads and how certain acts alleged in the Complaint materially affected Plaintiffs' relationships with others or how those acts did not have such an affect on those relationships and/or whether Plaintiffs suffered from the alleged emotional and psychological disorders as a result of other sexual acts prior to the acts alleged in the Complaint. To deny Epstein thus discovery, would be tantamount to barring him from mounting a defense." 50. ROTHSTEIN, EDWARDS and L.M.'s actions constitute a fraud upon EPSTEIN as RRA, ROTHSTEIN and the Litigation Team represented themselves to be acting in good faith and with the bests interests of their clients in mind at all times when in reality, they were acting in furtherance of the investment or Ponzi scheme described herein. EPSTEIN justifiably relied to his detriment on the representations of RRA, and Defendants, ROTHSTEIN, EDWARDS and L.M. as to how he conducted and defended the Civil Actions brought against him. 51. As a direct and proximate result of the fraudulent and illegal investment or Ponzi scheme orchestrated by ROTHSTEIN and as yet other unknown co-conspirators and as a result of the litigation tactics undertaken by the Litigation Team and L.M. as set forth herein, Plaintiff EPSTEIN has incurred and continues to incur the monetary damages including, but not limited to, having to pay an amount in excess of the Civil Actions' true value as a result of them refusing to settle in that a percentage of any payment by EFTA00596517 Epstein v. RRA, et al. Page 30 tors; incurring significant EPSTEIN may have been promised to third party inves ts refusal to conduct settlement additional legal fees and costs as result of Defendan use any monies paid by negotiations in a forthright and good faith manner beca tment; and incurred significant EPSTEIN is in reality a promised return on an inves was not relevant, material attorneys' fees and costs in defending the discovery that but which was done for the and/or calculated to lead to the admissibility of evidence, sole purpose of "pumping" the cases to investors. of the fraudulent and criminal 52. EPSTEIN has also been injured in that the scope that EPSTEIN has been or racketeering activity so permeated the RRA law firm brought against him. In prevented from fully and fairly defending the civil actions continuation of the massive essence, the very existence of RRA was based on the nspirators. In order to Ponzi scheme orchestrated by ROTHSTEIN and other co-co co-conspirators used continue to bring in monies from investors, ROTHSTEIN and other red lawsuits, as a means the Civil Actions against EPSTEIN, along with other manufactu of obtaining massive amounts of money. caused to EPSTEIN — 53. ROTHSTEIN, EDWARDS and L.M. are liable for damages individually, and jointly and severally. Count I - Violation of 44772.101, et seq., Fla. Stat. - Florida Civil Remedies for Criminal Practices Act — Against All Defendants gh 53 as if fully set forth 54. Plaintiff realleges and incorporates paragraphs 1 throu herein. EFTA00596518 Epstein v. RRA, et at Page 31 collectively constitute an 55. RRA, ROTHSTEIN, EDWARDS and L.M. each and enterprise pursuant to §772.102(3), Fla. Stat. (2009). of crimi nal activity as 56. ROTHSTEIN, EDWARDS and L.M. engaged in a pattern defined in §772.102(3) and (4), Fla. Stat. (2009). itted multiple predicate 57. As alleged herein, ROTHSTEIN and EDWARDS comm including violations of Florida acts in violation of §772.103(1), (2), (3) and (4), Fla. Stat., Chapter 817, relating to Statutes - Chapter 517, relating to securities transactions; includes L.M.); Chapter fraudulent practices, false pretenses, and fraud generally (which includes L.M.); and Chapter 831, relating to forgery; §836.05, relating to extortion (which lly more than two predicate 837, relating to perjury (which includes L.M.). Substantia ated settlements outlined acts (i.e., the selling of or participation of the sale of fabric as the improper litigation herein, including the Civil Actions involving Epstein as well d. tactics outlined above) occurred within a five-year time perio EDWARDS and L.M.'s 58. As a direct and proximate result of ROTHSTEIN, d. violations of §772.103, Fla. Stat., EPSTEIN has been injure EIN is entitled to threefold of 59. Pursuant to §772.104(1), Fla. Stat., Plaintiff EPST and court costs, and such his actual damages sustained, reasonable attorney's fees other damages as allowed by law. entry of a judgment for WHEREFORE, Plaintiff EPSTEIN respectfully demands the damages against all the named Defendants. Count II — Florida RICO - "Racketeer Influenced and Corrupt Organization Act" Pursuant to 44895.01, et sea.. Fla. Stat. (2009), Against All Defendants EFTA00596519 Epstein v. RRA, et al. Page 32 gh 53 as if fully set forth 60. Plaintiff realleges and incorporates paragraphs 1 throu herein. each and collectively, 61. RRA, along with ROTHSTEIN, EDWARDS and L.M., ). constitute an enterprise pursuant to §895.02(3), Fla. Stat. (2009 S and L.M. were and 62. During all times relevant hereto, ROTHSTEIN, EDWARD are associated with the enterprise, RRA, and each other. ns associated with the 63. Defendants, ROTHSTEIN, EDWARDS and L.M., as perso conducted or participated, enterprise, RRA and each other (as an enterprise), unlawfully pattern of racketeering, § directly or indirectly, in such an enterprise through a 895.03(3), Fla. Stat., as alleged above herein. S and, potentially, L.M.'s 64. The breadth and scope of ROTHSTEIN, EDWARD FBI, as numerous civil lawsuits racketeering activity continues to be investigated by the filed by persons who have against some of the Defendants and others continue to be nal charges have only been been damaged. As of the filing of this Complaint, crimi brought against ROTHSTEIN. the selling of fabricated 65. Substantially more than two predicate acts (i.e., ving Epstein as well as the settlements outlined herein, including the Civil Actions invol five year time period. improper litigation tactics outlined above) occurred within a ARDS engaged in a 66. Pursuant to §895.02, Fla. Stat., ROTHSTEIN and EDW of crimes as defined in § pattern of "racketeering activity" through the commission relating to securities; Chapter 817, 895.02(1)(a)-(b), Fla. Stat., including Chapter 517, ding L.M.) generally; relating to fraudulent practices, false pretenses, and fraud (inclu EFTA00596520 Epstein v. RRA, et al. Page 33 tion (including L.M.); Chapter Chapter 813, relating to forgery; §836.05, relating to extor 837, relating to perjury (including L.M.). the following relief against 67. Pursuant to §895.05, Fla. Stat., Plaintiff seeks Defendants, ROTHSTEIN, EDWARDS and L.M.: selves of a) Ordering ROTHSTEIN and EDWARDS to divest them any interest in the enterprise, RRA; of conduct b) Enjoin all Defendants from engaging in the same type and activities as described herein; and from c) Temporarily enjoining ROTHSTEIN, EDWARDS and L.M., EPSTEIN the continuation of the Civil Actions brought against st RRA until criminal charges have been formally brought again may be and/or any of the Defendants, such that EPSTEIN ns allowed to evaluate whether a stay or dismissal of all Civil Actio against him is merited. attorney's fees and costs, 68. EPSTEIN further seeks an award of his reasonable and such other relief that this Court deems appropriate. nds the entry of a judgment for WHEREFORE, Plaintiff EPSTEIN respectfully dema ts. the relief sought and damages against the named Defendan Count III — Abuse of Process — Against All Defendants through 53 as if fully set forth 69. Plaintiff realleges and incorporates paragraphs 1 herein. EFTA00596521 Epstein v. RRA, et al. Page 34 the actions of Defendants, 70. After instituting the Civil Actions against EPSTEIN, raphs 9 through 53 herein, ROTHSTEIN, EDWARDS and L.M. as alleged in parag constitute an illegal, improper or perverted use of process. ulterior motives or purposes in 71. ROTHSTEIN, EDWARDS and L.M. possessed ss. exercising such illegal, improper, or perverted use of proce s actions, EPSTEIN suffered 72. As a result of ROTHSTEIN, EDWARDS and L.M.' damages. the entry of a judgment for WHEREFORE, Plaintiff EPSTEIN respectfully demands damages against all the named Defendants. Count IV — Fraud Against All Defendants gh 53 as if fully set forth 73. Plaintiff realleges and incorporates paragraphs 1 throu herein. S and L.M. made false 74. ROTHSTEIN, by and through Defendant EDWARD ts, known to be false at the statements of fact to EPSTEIN and his attorneys and agen ation from EPSTEIN and his time made, and/or intentionally concealed material inform EIN to act in reliance thereon. attorneys and agents, for the purpose of inducing EPST ealment by incurring 75. EPSTEIN did so act on the misrepresentation and/or conc ssively defending the civil additional attorney's fees, costs, and expenses in aggre st Plaintiff were being actions whereas in reality, because the Civil Actions again tors and to attempt to extort as exploited and over-valued so as to lure additional inves massive fraud. much money as possible from EPSTEIN so as to continue the EFTA00596522 Epstein v. RRA, et al. Page 35 WHEREFORE Plaintiff EPSTEIN demands judgment against Defendants for damages incurred and for any other relief to which he is entitled under the law. Conspiracy to Commit Fraud Against All Defendants 76. Plaintiff realleges and incorporates paragraphs 1 through 53, and 74 and 75 as if fully set forth herein. 77. ROTHSTEIN, EDWARDS and L.M. conspired to commit a fraud upon EPSTEIN. 78. ROTHSTEIN, EDWARDS and L.M. combined by and through concerted action as detailed herein to accomplish an unlawful purpose or accomplish some purpose by unlawful means. The unlawful purpose was, among other things, the orchestrating and continuation of the massive fraudulent Ponzi scheme and receipt of monies for the continuation of the scheme. The unlawful means includes, but is not limited to, the use of the Civil Actions against EPSTEIN in an unlawful, improper, and fraudulent manner. 79. As a direct and proximate result of ROTHSTEIN, EDWARDS and L.M.'s conspiracy to defraud EPSTEIN, EPSTEIN suffered damages. WHEREFORE Plaintiff EPSTEIN demands judgment against Defendants for damages incurred and for any other relief to which he is entitled under the law. Jury Trial Plaintiff demands Jury Trial on all issues so triable. By: ROBERT . CRITTON, JR., ESQ. Florida r No. 224162 EFTA00596523 Epstein v. RRA, et al. Page 36 rcrit@bddaw.com MICHAEL J. PIKE, ESQ. Florida Bar #617296 meikeebciclaw.com BURMAN, CRITION, LUTTIER & COLEMAN 303 Banyan Blvd., Suite 400 ch, FL 33401 Fax: (Attorneys for Plaintiff) EFTA00596524 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 1 of 36 UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF FLORIDA CASENO9 a603 31 mAGisTRAnHN CR-CO ,u Dca 18 U.S.C. §1962(d) 18 U.S.C. §1956(h) maga 18 U.S.C. §1349 18 U.S.C. §1343 18 U.S.C. § 2 18 U.S.C. §1963 18 U.S.C. §982(a)(1) 18 U.S.C. §981(aX1XC) UNITED STATES OF AMERICA, FILED by ma Plaintiff; DEC 01 309: v. STEVEN M. LARIMORE CLERK U. S. DtST. CT. S. D. of FLA. — FT. LAUD. SCOTT W. ROTHSTEIN, Defendant. INFORMATION The United States Attorney charges that, at all times relevant to this Information: GENERAL ALLEGATIONS 1. Scott W. Rothstein was an attorney admitted to practice law in Florida. Defendant Adler, Rothstein was the Chief Executive Officer (CEO) and Chairman of Rothstein, Rosenfeldt and PA. 2. Rothstein, Rosenfeldt and Adler, P.A. was a law firm with offices located at 401 East approximately Las Olas Boulevard, Fort Lauderdale, Florida and elsewhere. The law firm employed range of specialties, seventy (70) attorneys and engaged in the practice of law involving a wide including labor and employment law. EXHIBIT i Vqt r cif1.71;VAL EFTA00596525 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 2 of 36 COUNT 1, (Racketeering Conspiracy, 18 U.S.C. §1962(d)) 1. The General Allegations of this Information are realleged and expressly incorporated herein as if set forth in full. THE ENTERPRISE 2. The law firm, Rothstein, Rosenfeldt and Adler, P.A. (hereinafter referred to as RRA) was a legal entity organized under the laws of the State of Florida and constituted an Enterprise as that term is defined in Title 18, United States Code, Section 1961(4). The Enterprise engaged in, and the activities of which affected, interstate and foreign commerce. THE RACKETEERING CONSPIRACY 3. From in or about 2005 and continuing through in or about November 2009, in the Southern District of Florida and elsewhere, the defendant, SCOTT W. ROTHSTEIN, being a person employed by and associated with the Enterprise described above, which was engaged in, and the activities of which affected, interstate and foreign commerce, did knowingly combine, conspire, confederate, and agree, with persons known and unknown to the United States Attorney, to violate Title 18, United States Code, Section 1962(c); that is, to conduct and participate, directly and indirectly, in the conduct of the affairs of the Enterprise through a pattern of racketeering activity herein as that tennis defined in Title 18, United States Code, Sections 1961(1) and (5), as set forth below at paragraph 4. 2 EFTA00596526 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 3 of 36 THE PATTERN OF RACKETEERING ACTIVITY 4. The pattern of racketeering activity as defined in Title 18, United States Code, Sections 1961(1) and 1961(5), through which the defendant and his co-conspirators agreed to conduct and participate, directly and indirectly, in the conduct of the affairs of the Enterprise consisted of multiple acts indictable under the laws of the United States, namely: i. Title 18, United States Code, Section 1341 (mail fraud); ii. Title 18, United States Code, Section 1343 (wire fraud); iii. Title 18, United States Code, Section 1956(a)(1) (laundering of monetary instruments); iv. Title 18, United States Code, Section 1957 (engaging in monetary transactions); and v. Title 18, United States Code, Section 1956(h) (conspiracy to launder monetary instruments and engage in monetary transactions. THE PURPOSE AND OBJECT OF THE RACKETEERING ACTIVITY 5. The principal purpose of the racketeering conspiracy was to generate money for the defendant and his co-conspirators through the operation of the Enterprise and through various criminal activities, including mail fraud, wire fraud, and money laundering. 6. The defendant and his co-conspirators agreed to engage in a pattern of racketeering activity through its base of operation at the offices of RRA. The conspirators also utilized other co- locations to further the objectives of the Enterprise. RRA was utilized by the defendant and his conspirators to unlawfully obtain approximately $1.2 billion from investors by fraud in connection investors' funds with an investment scheme commonly known as a "Ponzi" scheme, in which new 3 EFTA00596527 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 4 of 36 are utilized to pay previous investors in the absence of any underlying security, legitimate investment vehicle or other commodity. THE ROLES AND RESPONSIBILMES OF THE CONSPIRATORS 7. The roles of the conspirators were as follows: A. Defendant SCOTT W. ROTHSTEIN was a shareholder, Chairman and CFA of RRA. Through his position at RRA, defendant ROTHSTEIN promoted, managed, and supervised the administration of the Enterprise by fraudulently inducing investors through the use of false statements, documents, and computer records to (1) loan money to purported borrowers based upon fraudulent promissory notes and fictitious bridge loans, and (2) invest funds based upon anticipated pay-outs from purported confidential settlement agreements which had been reached between and among certain individuals and business entities. These settlement agreements were falsely presented as having been reached between putative plaintiffs in civil cases and putative defendants based upon the forbearance of civil claims in sexual harassment and/or whistle-blower cases. B. Other conspirators, known and unknown to the United States Attorney, agreed with one another and with defendant ROTHSTEIN to take actions to further the operation and success investors as of the "Ponzi" scheme, including presenting the aforesaid investments to potential place legitimate investment vehicles, when in fact they were not; fraudulently inducing investors to forth below; funds into these investment vehicles by making material misstatements of facts as set these assuring potential investors and investors that sufficient funds existed to pay returns on into and from, investments, when in fact such funds did not exist; creating, and transferring funds scheme; and realizing various accounts at financial institutions in order to further the unlawful EFTA00596528 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 5 of 36 profits from the operation of the Ponzi scheme through the acquisition of money generated as proceeds from the scheme and through the acquisition of real and personal property. MANNER AND MEANS OF THE RACKETEERING CONSPIRACY 8. It was part of the conspiracy that the defendant agreed that a conspirator would commit at least two acts of racketeering activity in the conduct of the affairs of the Enterprise. 9. Defendant ROTHSTEIN and other co-conspirators initiated the criminal conduct alleged in the instant Information in order to personally enrich themselves and to supplement the income and sustain the daily operation of RRA. 10. Defendant ROTHSTEIN and other co-conspirators fraudulently solicited investors to loan money based upon promissory notes and bridge loans to and from purported clients of RRA. Defendant ROTHSTEIN falsely alleged that clients of RRA requested short-term financing for clients were undisclosed business deals. Defendant ROTHSTEIN falsely alleged that the purported willing to pay high rates of return on loans negotiated by Defendant ROTHSTEIN. In fact, defendant existed. ROTHSTEIN was aware that no such clients or requests for business financing actually 1I. Defendant ROTHSTEIN and other co-conspirators participated in an investment purported scheme commonly known as a "Ponzi" scheme. The "Ponzi" scheme involved the sale of potential confidential settlement agreements in sexual harassment and/or whistle-blower cases. The l settlement investors were told by defendant ROTHSTEIN and other co-conspirators that confidentia available in agreements were available for purchase. The purported settlements wcre allegedly be purchased amounts ranging from hundreds of thousands of dollars to millions of dollars and could at a discount and repaid to the investors at face value over time. S EFTA00596529 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 6 of 36 of RRA and 12. Defendant ROTHSTEIN and other co-conspirators utilized the offices legitimacy and success of the offices of other co-conspirators to convince potential investors of the tunity. the law firm, which enhanced the credibility of the purported investment oppor and misleading 13. Defendant ROTHSTEIN and other co-conspirators made false e potential investors into statements and omissions which were intended to fraudulently induc purchasing the confidential settlements. ing fraudulent 14. Defendant ROTHSTEIN and other co-conspirators made the follow purchase the purported settlements: representations to potential investors in order to induce them to to protect the A. That the purported settlements were highly confidential in order and the executives reputation of the company authorizing the settlement involved; ment and/or whistle-blower B. That the plaintiffs in the purported sexual harass the emotional cases preferred to settle the cases in order to avoid embarrassment of pursuing a claim in a public forum; internal staff and outside C. That RRA originated its own cases from reputation, referrals from other law firms; et sites and well-placed D. That RRA retained a company that owned intern of high quality cases; "800" numbers designed to attract a large volume sexual harassment and/or E. That RRA rigorously screened the purported whistle-blower settlement agreements; 6 EFTA00596530 36 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 7 of F. That RRA utilized former law enforcement personnel and employed highly sophisticated investigative methods in selecting and pursuing claims against purported defendants; ant G. That RRA or other law firms pursued purported settlements with defend companies prior to the initiation of litigation; defendant H. That RRA or other law firms negotiated with the purported the company after such company was made aware of the alleged claim by plaintiff; defendant I. That RRA or other law firms purportedly negotiated with the settlement amount company and reached an agreement which contained the and the payment terms; to the initiation of J. That because the purported settlements occurred prior involved in the litigation, there was no court or governmental entity transaction; to RRA or other K. That the alleged defendant companies sent by wire transfer rted settlements; law firms' trust accounts the full proceeds of the purpo negotiations when L. That during the settlement conference or other settlement schedule, RRA or other a purported plaintiff protested the extended payment option of receiving a law firms presented the purported plaintiff with the ential funding source; discounted lump sum payment from an unrelated confid rted Assignment of M. That RRA or other co-conspirators prepared a purpo acquire the right to the Settlement Agreement in which the investor agreed to 7 EFTA00596531 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 8 of 36 purported settlement payments for a discounted lump sum payment made to the purported plaintiff; y N. That when RRA received the payment by the investor it immediatel disbursed those funds to the purported plaintiff; and payment O. That RRA made payment to the investor pursuant to the purported schedule set forth in the purported settlement agreement. informed potential IS. Defendant ROTHSTEIN and other co-conspirators falsely for the benefit of the individual investors that funds were maintained in designated trust accounts weekly if not more often, by two investor and that these funds were verified on a regular basis, other being an independent financial independent verification sources, one being an attorney and the advisor (hereinafter referred to "independent verifiers"). falsely informed potential 16. Defendant ROTHSTEIN and other co-conspirators established international banking investors that RRA's trust accounts were maintained with a well the Florida Bar, and that access to institution, in accordance with the rules and regulations of of the two independent verifiers. balances in the trust accounts was allegedly monitored by one falsely informed potential 17. Defendant ROTHSTEIN and other co-conspirators the following provisions: investors that due diligence would be undertaken with to ask questions of Defendant A. An "independent verifier" would be permitted the opportunity and ROTHSTEIN and/or other co-conspirators to review structure; to randomly review B. The "independent verifier" would have the opportunity veracity of the information; selected completed transactions to confirm the 8 EFTA00596532 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 9 of 36 , C. The "independent verifier" had already reviewed current transactions to including wire transfers received from defendants and payments made plaintiffs; and speak D. The "independent verifier" would have the opportunity to visit tion to with a senior banking officer at the local branch of the financial institu ents confirm current trust account bank balances through bank statem provided on line; and with a senior banking E. The "independent verifier" had the opportunity to meet to verify the officer to verify that the trust accounts were "locked" and the bank. strength of RRA's financial position and relationship with established numerous trust 18. Defendant ROTHSTEIN and other co-conspirators and current investors of the legitimacy accounts in the name of RRA in order to convince potential such investments. of the confidential settlement agreements and the security of red and used altered bank 19. Defendant ROTHSTEIN and other co-conspirators prepa international financial institution, to statements, purportedly issued from a well-established been received from the purported fraudulently convince potential and current investors that funds had defendant companies and were maintained in trust accounts. and other co-conspirators 20. In order to deceive investors, defendant ROTHSTEIN information regarding the purported trust created, altered and/or maintained fictitious online banking ained in such accounts, the receipt of accounts which falsely reflected the amount of funds maint transmission of funds by wire to the funds wired from the alleged defendant companies and the alleged plaintiffs, 9 EFTA00596533 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 10 of 36 us 21. Defendant ROTHSTEIN and other co-conspirators created false and fictitio ment agreements and documents, including confidential settlement agreements, assignment of settle STEIN, among proceeds, sale and transfer agreements, and personal guaranties by Defendant ROTH other documents. ment and 22. Defendant ROTHSTEIN and other coconspirators facilitated the move ting accounts in order to transfer of funds between and among numerous trust accounts and opera that monies were available perpetuate the scheme. The movement and transfer of such funds insured to investors. in the individual trust accounts in order to make scheduled payments statements to current 23. Defendant ROTHSTEIN and other coconspirators made false purported confidential settlement investors in order to convince them to re-invest in additional agreements. the creation of false and 24. Defendant ROTHSTEIN and other co-conspi rators facilitated the financial institution where the trust fictitious "lock letters" which were issued by an executive at y reflected that the funds and operating accounts were maintained. Such "lock letters" falsel specific investors. maintained in specific trust accounts would only be disbursed to d funds received from 25. Defendant ROTHSTEIN and other co-conspirators utilize investors. investors to pay the promised "return on investment" to earlier ed and conducted a 26. Defendant ROTHSTEIN and other co-conspirators also initiat "Ponzi" scheme. Such clients had scheme to defraud clients of RRA in order to perpetuate the clients, RRA settled the lawsuit retained RRA to institute and file a civil lawsuit. Unknown to the In order to commit the fraud and deceive and obligated the clients to pay $500,000 to the defendant. tors created a false and fraudulent court the clients, defendant ROTHSTEIN and other co-conspira 10 EFTA00596534 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 11 of 36 which falsely alleged that the clients had order purportedly signed by a Federal District Court Judge nt approximately $23 million. The fraudule prevailed in the lawsuit and were owed a judgement of r sferred funds to the Cayman Islands in orde court order also falsely stated that the defendant had tran to avoid paying the judgement. rs falsely advised the clients on 27. Defendant ROTHSTEIN and other co-conspirato to be held ndant's funds, they had to post bonds several occasions that in order to recover the defe caused and other co-conspirators fraudulently in the RRA trust account. Defendant ROTHSTEIN unt controlled ion over several years to a trust acco the clients to wire transfer approximately $57 mill bonds. by defendant ROTHSTEIN, purportedly to satisfy the irato rs caused the funds transmitted by 28. Defendant ROTHSTEIN and other co-consp me unts in order to perpetuate the "Ponzi" sche the clients to be transferred to other RRA trust acco ciated with the Enterprise. and to enrich those co-conspirators who were asso rs were questioned by the clients as 29, Defendant ROTHSTEIN and other co-conspirato nts, defendant to delay the return of funds to the clie to the progress of the alleged lawsuit. In order eral court order purportedly issued by a United States ROTHSTEIN fraudulently created a false Fed date. rn the transmitted funds by a later Magistrate Judge allegedly ordering RRA to retu ugh irators utilized funds obtained thro 30. Defendant ROTHSTEIN and other co-consp nd RRA the oper ation and activities of RRA, to expa the "Ponzi" scheme to supplement and support and to acquire ort staff, to fund salaries and bonuses, by the hiring of additional attorneys and supp of equipment in orde r to enrich the personal wealth larger and more elaborate office space and Enterprisc. persons employed by and associated with the 11 EFTA00596535 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 12 of 36 utilized funds illegally obtained 31. Defendant ROTHSTEIN and other coconspirators tical con tributions to local, state and federal poli through the "Ponzi" scheme to make political state true source of such funds and to circumvent candidates, in a manner designed to conceal the tribution of such funds. and federal laws governing the limitations and con rs used other corporations in order 32. Defendant ROTHSTEIN and other co-conspirato funds utilized scheme to conceal the source of the to launder proceeds generated from the "Ponzi" ote the "Ponzi" scheme. to make political contributions in order to prom es irators paid large bonuses to employe 33. Defendant ROTHSTEIN and other co-consp , the y work. Prior to the receipt of the bonuses of RRA purportedly as an award for exemplar employees' tribu tions to political candidates in the employees were instructed to make large con ution and to illegally ceal the true source of the contrib names. Such conduct was designed to con circumvent campaign finance laws. uding onsp irators distributed lavish gifts incl 34. Defendant ROTHSTEIN and other co-c order to uses to individuals and members of RRA in exotic cars, jewelry, boats, loans, cash and bon firm. te the appearance of a successful law engender goodwill and loyalty and to crea le onspirators made large charitab 35. Defendant ROTHSTEIN and other co-c other legitimate institutions, including hospitals and contributions to public and private charitable me. funds derived from the "Ponzi" sche charitable and nonprofit organizations using irators utilized funds illegally obtained 36. Defendant ROTHSTEIN and other co-consp dly to provide local police departments purporte through the "Ponzi" scheme to hire members of me funds were EIN 's personal residence. "Ponzi" sche security for RRA and defendant ROTHST r to curry favor members of police agencies in orde also used to provide gratuities to high ranking 12 EFTA00596536 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 13 of 36 with such police personnel and to deflect law enforcement scrutiny of the activities of RRA and defendant ROTHSTEIN. 37. Defendant ROTHSTEIN and other co-conspirators utilized funds obtained through the "Ponzi" scheme in order to purchase controlling interests in restaurants located in the Southern District of Florida. Such restaurants were used in part as a mechanism to give gratuities to individuals, including politicians, business associates and attorneys, in order to foster goodwill and loyalty, as a location to solicit potential investors and as a secure location for conspiratorial meetings. 38. Defendant ROTHSTEIN and other co-conspirators associated with affluent and politically connected individuals in order to lure wealthy investors into the "Ponzi" scheme. 39. Defendant ROTHSTEIN and other co-conspirators associated with well known sports figures and politicians, in public forums and elsewhere, in order to gain greater notoriety and to create the appearance of wealth and legitimacy. Such acts were calculated in part to enhance defendant ROTHSTEIN's ability to solicit potential investors in the "Ponzi" scheme. 40. Defendant ROTHSTEIN and other co-conspirators used funds derived from the "Ponzi" scheme to maintain the appearance of affluence and wealth, by purchasing expensive real of the and personal property, in order to convince potential investors of the legitimacy of RRA and purported investment opportunities. Defendant ROTHSTEIN purchased expensive real property, wealth. personal property, business interests, vessels, vehicles and other indicia of success and All in violation of Title 18, United States Code, Section 1962(d). 13 EFTA00596537 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 14 of 36 COUNT Z (Money Laund ering Consp iracy, 18 U.S.C. §1956(h)) . 1. The General Allegations and paragraphs 5 through 40 of Count 1 of the Information are realleged and incorporated herein by reference. with 2. T1) Bank, N.A., (hereinafter referred to as TD Bank) was a commercial bank Florida. The executive branch offices in thirteen (13) states, including a branch office in Weston, New Jersey. Defendant offices of TD Bank were located in Portland, Maine and Cherry Hill, (38) bank accounts at TD Bank, ROTHSTEIN and RRA maintained approximately thirty-eight which were utilized during the course of the "Ponzi" scheme. Gibraltar Bank) was a 3. Gibraltar Private Bank and Trust (hereinafter referred to as h office in Fort Lauderdale, commercial bank with seven (7) branch offices, including a branc four (4) bank accounts at Gibraltar Florida. Defendant ROTHSTEIN and RRA maintained at least e. Bank, which were utilized during the course of the "Ponzi" schem about November 2009, 4. From in or about 2005 and continuing thereafter through in or elsewhere, the defendant, in Broward County, in the Southern District of Florida and SCOTT W. ROTHSTEIN, known and unknown to the United did knowingly conspire, confederate, and agree with persons violation of Title 18, United States States Attorney, to commit offenses against the United States in Code, Sections 1956 and 1957, that is: ial transactions i. to knowingly conduct and attempt to conduct financ ed the proceeds of a specified affecting interstate and foreign commerce, which involv violation of Title 18, United unlawful activity, that is, mail fraud and wire fraud, in promote the carrying on of States Code, Sections 1341 and 1343, with the intent to conducting and attempting to said specified unlawful activities, and that while rty involved in the fi nancial conduct such fi nancial transactions knew that the prope 14 EFTA00596538 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 15 of 36 in violation transaction represented the proceeds of some form of unlawful activity of Title 18, United States Code, Section 1956(a)(1)(AX0i ii. to knowingly conduct and attempt to conduct financial transactions ed affecting interstate commerce and foreign commerce, which transactions involv and wire fraud, in the proceeds of specified unlawful activity, that is, mail fraud knowing that the violation of Title 18, United States Code, Sections 1341 and 1343, al and disgu ise the nature, transactions were designed in whole or in part to conce specified unlawful location, source, ownership, and control of the proceeds of ct such financial activity, and that while conducting and attempting to condu transactions represented transactions, knew that the property involved in the financial Title 18, United States the proceeds of some form of unlawful activity, in violation of Code, Section 1956(aX I XBXi); and transactions by, iii. to knowingly engage and attempt to engage, in monetary foreig commerce, in n through or to a financial institution, affecting interstate and which property having criminally derived property of a value greater than $10,000, mail fraud and wire fraud, been derived from a specified unlawful activity, that is, ns 1341 and 1343, in violation of in violation of Title 18, United States Code, Sectio Title 18, United States Code, Section 1957. n 1956(h). All in violation of Title 18, United States Code, Sectio COUNT 3 (Mail and Wire Fraud Conspiracy, 18 U.S.C. §1349) h 40 of Count 1 of the Information I. The General Allegations and paragraphs 5 throug are realleged and incorporated herein by reference. h in or about November 2009, 2. From in or about 2005 and continuing thereafter throug a and elsewhere, the defendant, in Broward County, in the Southern District of Florid SCOTT W. ROTHSTEIN, with other persons known and unknown did knowingly combine, conspire, confederate, and agree 18, st the United States in violation of Title to the United States Attorney to commit offenses again United States Code, Sections 1341 and 1343, that is: 1.5 EFTA00596539 36 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 16 of i. to knowingly and with intent to defraud devise and intend to devise a others by scheme and artifice to defraud and to obtain money and property from promises, means of materially false and fraudulent pretenses, representations, and g to be delivered knowing that they were false and fraudulent when made, and causin to the certain mail matter by any private and commercial interstate carrier, according ion of Title 18, directions thereon, for the purpose of executing the scheme, in violat United States Code, Section 1341 devise a ii. to knowingly and with intent to defraud devise and intend to rty from others by scheme and artifice to defraud and to obtain money and prope ons, and promises, means of materially false and fraudulent pretenses, representati transmitting and knowing that they were false and fraudulent when made, and tate and foreign causing to be transmitted by means of wire communications in inters se of executing the commerce, certain signs, signals and sounds, for the purpo scheme, in violation of Title 18, United States Code, Section 1343. THE PURPOSE AND OBJECT OF THE CONSPIRACY defendant ROTHSTEIN and 3. The purpose and object of the conspiracy was to enrich ors and converting the investors' money his co-conspirators by illegally obtaining money from invest above-described "Ponzi" scheme. to their own use and benefit through the operation of the 1349. All in violation of Title 18, United States Code, Section COUNTS 4 and 5 (Wire Fraud, 18 U.S.C. §1343) 40 of Count 1 of the Information I. The General Allegations and paragraphs 5 through are realleged and incorporated herein by reference. below, at Broward and Miami- 2. On or about the dates enumerated as to each count elsewhere, the defendant, Dade Counties, in the Southern District of Florida, and SCOTT W. ROTHS I EIN, d intend to devise a scheme and artifice to defrau did knowingly and with intent to defraud devise and of materially false and fraudulent pretenses, and to obtain money and property from others by means 16 EFTA00596540 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 17 of 36 enses, representations, and promises were false representations, and promises, knowing that such pret g the scheme, transmitted and caused to and fraudulent when made, and for the purpose of executin foreign commerce, as more particularly be transmitte d certain wire communications in interstate and described below: COUNT DATE WIRE COMMUNICATION k to 4 December 2, 2008 Interstate wire transfer sent from TD Ban Gibraltar Bank k from JP 5 October 16, 2009 Interstate wire transfer sent to TD Ban Morgan Chase Sections 1343 and 2. All in violation of Title 18, United States Code, FORFEITURE ALLEGATIONS realleged and by this reference fully 1. The allegations of this Information are certain ing forfeitu res to the United States of America of incorporated herein for the purpose of alleg Rules of uant to 7(c)(2) and 32.2(a), Federal property in which the defendant has an interest purs United States pursuant to the provisions of Title 18, Criminal Procedure. Forfeiture is being sought e 28, United ), as made applicable hereto by Titl Code, Sections 1963(a), 982(a) and 981(a)(l)(C States Code, Section 2461. the Conspiracy set forth in Count 1 of 2. Upon conviction of the offense of RICO United States the ROTHSTEIN, shall forfeit to the Information, the defendant, SCOTT W. following property: purs uant to Section 1962; i. Any interest acquired or maintained against, or property or ii. Any interest in, security of, claim source of influence over, the contractual rights of any kind affording a 17 EFTA00596541 Case 0:09-er-60331-MC Document 1 Entered on FLSD Docket 12/01/2009 Page 18 of 36 enterprise described in the Information which was established, operated, controlled and conducted pursuant to Title 18, United States Code, Section 1962; and ed iii. Any property constituting or derived from proceeds obtain 18, directly and indirectly from racketeering activity pursuant to Title United States Code, Section 1962. set forth in Count 3. Upon conviction of the offense of Money Laundering Conspiracy forfeit to the United States all 2 of the Information, the defendant, SCOTT W. ROTHSTEIN, shall which property shall include: property, real or personal, involved in or traceable to the offense of each i. all money and other property that was the subject ion of transaction, transportation, transmission and transfer in violat Section 1956(h); proceeds obtained ii. all commissions, fees and other property constituting as a result of those violations; and to facilitate the iii. all property used in any manner and part to commit and commission of those violations. Fraud and Wire Fraud 4. Upon conviction of the offense of Conspiracy to Commit Mail 5 of the Information, the defendant, and to Commit Wire Fraud as set forth in Counts 3, 4, and nal, which SCOTT W. ROTHSTEIN, shall forfeit to the United States, all property, real or perso constitutes or is derived from proceeds traceable to the offense. States Code, Sections 5. The property subject to forfeiture, pursuant to Title 18, United 1963, 982(aX1) and 981(a)(1XC), includes but is not limited to: 18 EFTA00596542 Case 0:09-or-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 19 of 36 A. A sum of money equal to $1,200,000,000 in United States currency. B. Real Properties ("RP"): as "Defendant (RP I ) 2307 Castilla Isle, Fort Lauderdale, Florida, hereafter also referred to ents RPI," includes all buildings, improvements, fixtures, attachments and easem rdale Shores found therein or thereon, and is more particularly described as Laude 0210; Reamen Plat 15-31 B Lot 2 Blk 5 with a Folio Number of 5042 12 13 ed to as "Defendant (RP2) 2308 Castilla Isle, Fort Lauderdale, Florida, hereafter also referr and easements RP2," includes all buildings, improvements, fixtures, attachments as: Lauderdale Shores found therein or thereon, and is more particularly described 5042 12 13 0020; Reamen Plat 15-31 B Lot 2 Blic 4 with a Folio Number of also referred to as "Defendant (RP3) 2316 Castilla Isle, Fort Lauderdale, Florida, hereafter attachments and easements RP3," includes all buildings, improvements, fixtures, as: Lauderdale Shores found therein or thereon, and is more particularly described Reamen Plat 15-31 B Lot 3 & Lot 4 W Blk 4 with a Folio Number of 5042 12 13 0030; ter also referred to as"Defendant (RP4) 30 Isla Bahia Drive, Fort Lauderdale, Florida, hereaf attachments and easements RP4," includes all buildings, improvements, fixtures, as: Isla Bahia 47-2713 found therein or thereon, and is more particularly described Lot 63 with a Folio Number of 5042 13 16 0640; a, hereafter also referred to as "Defendant (RP 5) 29 Isla Bahia Drive, Fort Lauderdale, Florid xtures, attachments and easements RPS," includes all buildings, improvements, fi 19 EFTA00596543 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 20 of 36 B found therein or thereon, and is more particularly described as: Isla Bahia 47-27 Lot 35 with a Folio Number of 5042 13 16 0360; referred to as (RP6) 350 SE 2" Street, Unit 2840, Fort Lauderdale, Florida, hereafter also vements, "Defendant RP6," includes that portion of the condominium, impro particularly fixtures, attachments and easements found therein or thereon, and is more er of 5042 10 described as: 350 Las Olas Place Condo Unit 2840 with a Folio Numb AN 1490; hereafter also referred to as (RP8) 2133 Imperial Point Drive, Fort Lauderdale, Florida, , attachments and "Defendant RP8," includes all buildings, improvements, fixtures described as: Imperial easements found therein or thereon, and is more particularly 4942 12 07 2020; Point 1 Sec 53-44 B Lot II 131k 22 with a Folio Number of fter also referred to as "Defendant (RP9) 2627 Castilla Isle, Fort Lauderdale, Florida, herea attachments and easements RP9," includes all buildings, improvements, fixtures, bed as: Lauderdale Shores found therein or thereon, and is more particularly descri of 5042 12 13 0380; Rcamcm Plat 15-31 B Lot 22 Blk 5 with a Folio Number a, hereafter also referred to as (RP10)10630 NW 14th Street, Apt. 110, Plantation, Florid condominiumitownhome, "Defendant RP I 0," includes that portion of the found therein or thereon, and is improvements, fixtures, attachments and easements 1-"C" CONDO UNIT 201 more particularly described as: OPTIMA VILLAGE BLDG 2 with a Folio Number of 4941 31 AC 0110; Florida, hereafter also referred to as (RP11) 227 Garden Court, Lauderdale by the Sea, ngs, improvements, fixtures, "Defendant RP11," includes that portion of the buildi 20 EFTA00596544 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 21 of 36 ularly attachments and easements found therein or thereon, and is more partic AS described as: SILVER SHORES UNIT A 28-39 B POR of Lot 4, BLK 5 DESC TO BEG AT SE COR SAID LOT 4, N 79.37 W 37.75, S 79.37, E 35.75 TO POB AKA: UNIT a VILLAGE TOWNHOMES 227GARDEN with a Folio Number of 4943 18 24 0050; fter also referred to as (RPI2) 708 Spangler Boulevard, Bay 1, Hollywood, Florida, herea attachments and "Defendant RP12," includes all buildings, improvements, fixtures, described as: HARBOR easements found therein or thereon, and is more particularly M 25 S OF NE VIEW 10-5 B PORTION OF LOTS 1 & 2 BLK 2 DESC AS COM 84, S 15.72 TO POB, COR OF LOT 2 ON EFL, W 20.52 ALO S/R/W/L OF ST RD , F 49.07 TO POB S 7.25, F 12.59, S 24.40, W 29.92, N 7.66, W 31.74, N 24.00 23 28 0010; AKA: BAY 1 PORTSIDE with a Folio Number of 5042 a, hereafter also referred to (RP13) 1012 East Broward Boulevard, Fort Lauderdale, Florid vements, fixtures, attachments as "Defendant RP13," includes all buildings, impro particularly described as: and easements found therein or thereon, and is more 100 BLK 17 with a Folio BEVERLY HEIGHTS 1-30 B LOT 1 W 100, LOT 2 W Number of 5042 11 07 0540; a, hereafter also referred to as (RP14) 950 N Federal Highway, Fort Lauderdale, Florid fixtures, attachments and "Defendant RP14," includes all buildings, improvements, particularly described as: 31-48-43 easements found therein or thereon, and is more 5, N TO POB with a Folio S 150 OD FOL DESC, BEG INTER F Ft/W/I4 ST RD Number of 4843 31 00 0401; 21 EFTA00596545 Case 0:09-cr-60331-J1C Document 1 Entered on FLSD Docket 12/01/2009 Page 22 of 36 Florida, hereafter also (R1315)350 Las Olas Boulevard, Commercial Unit 2, Fort Lauderdale, condominium, referred to as "Defendant RP15," includes all portion of that n or thereon, and is improvements, fixtures, attachments and easements found therei CONDO UNIT more particularly described as: 350 LAS OLAS PLACE COMM CU2 with a Folio Number of 5042 10 AP 0020; ed to as "Defendant RP16," (RP16) 361 SE 9 Lane, Boca Raton, Florida hereafter also referr and easements found includes all buildings, improvements, fixtures, attachments therein or thereon; a hereafter also referred to as (RP I 7) 1198 N Old Dixie Highway, Boca Raton, Florid fixtures, attachments and "Defendant RP17," includes all buildings, improvements, easements found therein or thereon; a hereafter also referred to as (RP18) 1299 N Federal Highway, Boca Raton, Florid fixtures, attachments and "Defendant RP I 8," includes all buildings, improvements, easements found therein or thereon; York hereafter also referred to (RP19) 151 East 58 Street, Apartment 42D, New York, New condominium, improvonents, as "Defendant RP I 9," includes all portion of that n; fixtures, attachments and easements found therein or thereo Island hereafter also referred to as (RP20) 11 Bluff Hill Cove Farm, Narragansett, Rhode fixtures, attachments and "Defendant RP20," includes all buildings, improvements, easements found therein or thereon; 22 EFTA00596546 ' Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 23 of 36 also referred to as (RP21) 15 Bluff Hill Cove Farm, Narragansett, Rhode Island hereafter ments and "Defendant RP21," includes all buildings, improvements, fixtures, attach easements found therein or thereon; to as "Defendant (RP22) 353 4 Ave., Unit I2-H, Brooklyn, NY hereafter also referred vements, fixtures, RP22," includes all portion of that condominium, impro attachments and easements found therein or thereon; ndant RP23," includes (RP23) 290W llth St 4I1C, NY, NY hereafter also referred to as "Defe ments and casements all portion of that condominium, improvements, fixtures, attach found therein or thereon; and hereafter also referred to as (121324) Versace Mansion/Casa Casuarina-10% Ownership fixtures, attachments and "Defendant RP24," includes all buildings, improvements, easements found therein or thereon; C. Vehicles and Vessels ("VV"): 7066; (VV1) 1990 Red Ferrari F40 Coupe, VIN: ZFFMN34A5L008 (VV2) 2009 White Bentley Convertible, VIN: SCBDR33W29C059672; WDDAK76F98M001788; (VV3) 2008 Yellow McLaren Mercedes Benz SLR, VIN: 15557LA59223; (VV4) 2007 Black Limousine Ford Expedition, VIN: 1F1FK 011; (VV5) 2009 Red Ferrari 430 Spider, VIN: ZFFEW59A3 80163 L68557UX23044; (VV6) 2007 Silver Rolls Royce Convertible, VIN: SCA I 65; (VV7) 2006 Silver Hummer H1, VIN: 137PH84396E2206 ; (V V8) 2008 Cadillac Escalade, VIN: 1GYEC63858R234458 745; (VV9) 1967 Red Convertible Corvette, VIN: 1946775104 23 EFTA00596547 Case 0:09-cr-60331-J1C Document 1 Entered on FLSD Docket 12/01/2009 Page 24 of 36 , : VF9SA25C28M795153; (VV10) 2009 Black Bugatti Veyron EB 16.4 VIN 71; Convertible, VIN: SCA2D68528UX 160 (VV11)2008 Blue Rolls Royce Drophead 7; (VV17) 2007 87' Warren, Hull # WAR87777B70 ; (VV18) 33' Aquariva, Hull # XFA33R74G405 MA 3661I809; (VV19) 2009 11' Yamaha Jet Ski, Hull # YA MA3626I809; (VV20) 200911' Yamaha VS, Hull # YA 2679G809; (VV21) 2009 11' Yamaha VS, Hull #YAMA SERY001899; (VV22) 1999 55' Sea Ray 540 Sundancer, MA4288K809; and (VV23) 2009 Yamaha Jet Ski, Hull # YA 7. , VLN: ZHWBU8AHXALA0383 (VV 24) 2010 White Lamborghini 1p-670sv D. Tangibles ("1") ut Monday, s and earrings seized on or abo (T1) 304 pieces of jewelry, watches, necklace Scott and Kimberly Rothstein; November 9, 2009 from the residence of 9 from the t Monday, November 9, 200 (-12) 16 DuPont Lighters seized on or abou ; residence of Scott and Kimberly Rothstein the about Monday, November 9, 2009 from (T3) 3 pieces sports memorabilia seized on or ; residence of Scott and Kimberly Rothstein ember 9, 2009 seized on or about Monday, Nov (T4) $271,160 in United States currency berly Rothstein; from the residence of Scott and Kim er 4, 2009, on about Wednesday, Novemb (15) $1,500 in United States currency, seized ldt and the law firm of Rothstein, Rosenfe from the office of Scott W. Rothstein at Adler, P.A.; 24 EFTA00596548 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 25 of 36 (T6) $30,000 in American Express Gift Cards to the attention of Scott Rothstein, obtained from UPS on or about November 12, 2009; (T7) $50,000 in American Express Gift Cards to the attention of Scott Rothstein, obtained from UPS on or about November 13, 2009; (T8) 5 additional watches being voluntarily turned over to the United States; and (T9) Guitar collection of Scott W. Rothstein, located at the residence of Scott and Kimberley Rothstein, valued between $10,000 and $20,000. E. Bank Accounts ("BA") (BA1) Fidelity Investments Stock Account, in the name of Scott W. Rothstein, valued at approximately $1,263,780; (13A2) Gibraltar Bank account 50010085, in the approximate amount of $484,900.68; (13A3) Gibraltar Bank account 50010093, in the approximate amount of $53,448.51; (BA4) Gibraltar Bank account 50012053, in the approximate amount of $71,793.06; (BA5) Gibraltar Bank account 50015214, in the approximate amount of $995,521.42; (BA6) Bank account 178780211819923220000187 at Banque Populaire, Morocco, in the name of Scott Rothstein, in the approximate amount of $12,000,000; (BA7) Bank account at Banque Populaire, Morocco, in the name of Ahnick Khalid, up to the amount of $2,000,000; (BA8) Bank account at Banque Populaire, Morocco, in the name of Steve Caput', up to the amount of $1,000,000; 25 EFTA00596549 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 26 of 36 Rothstein (BA9) Toronto Dominion Bank, N.A. account 6860291266 in the name of contained the Rosenfeldt Adler, P.A. which, on or about November 11, 2009, approximate amount of $54,021.27; name of Rothstein (BA10)Toronto Dominion Bank, N.A. account 6861011556 in the ined the Rosenfeldt Adler, P.A. which, on or about November 11, 2009, conta approximate amount of $10,085.00; the name of Rothstein (BA11)Toronto Dominion Bank, N.A. account 6860420923 in about November 11, Rosenfeldt Adler, P.A, Attorney Trust Account 3, which, on or 2009, contained the approximate amount of $720,892.08; the name of DJB Financial (BAl2)Toronto Dominion Bank, N.A. account 6860422200 in the approximate amount Holding, which, on or about November 11, 2009, contained of $64,970.00; the name of RRA Sports and (BA13)Toronto Dominion Bank, N.A. account 6860755757 11, 2009, contained the Entertainment LLC, which, on or about November approximate amount of $10,490.10; in the name of RRA Goal Line (BA14)Toronto Dominion Bank, N.A. account 6860755781 2009, contained the Management, LLC, which, on or about November 11, approximate amount of $25,216.27; 77714 in the name of Rothstein (BA I 5)Toronto Dominion Bank, N.A. account 68610 11, 2009, contained the Rosenfeldt Adler, P.A., which, on or about November approximate amount of $20,080.00. 26 EFTA00596550 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 27 of 36 F. Business Interests ("BI") share s, of 50,000 shares (BII) Stock certificates, if issued, or the beneficial interest in such chartered stock of capital stock, in Gibraltar Private Bank & Trust, a federally by GBPT, LLC, a savings association, purchased in or about September 2009 Prope rty Management, Delaware Limited Liability Company, by its manager, Bahia , Scott W. Rothstein; LLC, a Delaware Limited Liability Company, by its co-manager (312) Scott W. Rothstein's equity interest in QTask; of Commerce; (B13) Scott W. Rothstein's equity interest in Broward Bank ante; (1314) Scott W. Rothstein's equity interest in Bova Ristor Cucin a; (B15) Scott W. Rothstein's equity interest in Bova ; (316) Scott W. Rothstein's equity interest in Bova Prime Iguana, Pembroke Pines, Florida; (317) Scott W. Rothstein's equity interest in Café USA, LLC; (BI8) Scott W. Rothstein's equity interest in Cart Shield Watches; (B19) Scott W. Rothstein's equity interest in Renato (8110) Scott W. Rothstein's equity interest in Edify LLC; io Vodka; (BD I) Scott W. Rothstein's equity interest in V Georg (B112) Scott W. Rothstein's equity interest in Sea Club; Star Mortgage; (BI13) Scott W. Rothstein's equity interest in North Hunter Marketing; (BI14) Scott W. Rothstein's equity interest in Kip Sports and Entertainment, LLC; (3115) Scott W. Rothstein's equity interest in RRA ing Versace Mansion/Casa Casuarina, includ (B116) Scott W. Rothstein's equity interest in s; 10 year Operating Agreement with 2 ten year option 27 EFTA00596551 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/0112009 Page 28 of 36 (BI17) Scott W. Rothstein's equity interest, and licensing rights, in Alternative Biofuel Company; (BI I 8) Scott W. Rothstein's equity interest in RRA Goal Line Management; (8119) Scott W. Rothstein's equity interest in Iron Street Management, LLC; (8120) Scott W. Rothstein's equity interest in, and loan to, Africat Equity IG Decide; (8121) Scott W. Rothstein's equity interest in, and rents derived from 1198 Dixie LLC; (8122) Scott W. Rothstein's equity interest in, and rents derived from 1299 Federal LLC; (B123) Promissory Note by Uniglobe in favor of Scott W. Rothstein; and (8I24) All equity interest held by or on behalf of Scott W. Rothstein, in the following corporations and entities: a. 29 Bahia LW; b. 235 GC LLC; c. 350 LOP#2840 LW; d. 353 BR LLC; e. 10630 11110 LLC; f. 708 Spangles LLC; g. 1012 Broward LLC; h. 1198 Dixie LLC; I. 1299 Federal LW; j. 2133 IP LLC; k. 15158 LLC; 1. AANG LLC; 28 EFTA00596552 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 29 of 36 m. AAMG I LLC; n. AAMM Holdings; o. ABT Investments LLC; p. Advanced Solutions; q. Bahia Property Management LLC; r. Boat Management LLC; s. BOSM Holdings LLC; t. BOVA Prime LLC; u. BOVA Restaurant Group LLC; v. The BOVA Group LLC; w. BOVA Smoke LLC; x. BOVCU LLC; y. BOVRI LLC; z. Broward Financial Holdings, Inc.; aa. CI07 LLC; ab. C108 LLC; ac. CII6 LLC; ad. C127 LLC; ae. CSU LLC; af. D & D Management & Investment LLC; ag. D & S Management and Investment LLC; ah. DJB Financial Holdings LLC; 29 EFTA00596553 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 30 of 36 ai. DYMMU LLC; aj. Full Circle Fort Lauderdale LLC; ak. Full Circle Trademark Holdings LLC; al. GHW I LLC; am. 1DNL GEAH LLC; an. ILK3 LLC; ao. IS Management LLC; ap. JRCL LLC; aq. Judah LLC; ar. Kendall Sports Bar; as. Kip Hunter Marketing LLC; at. NF Servicing LLC; au. NRIII LLC; ay. NM 15 LLC; aw. NS Holdings LLC; ax. PRCH LLC; ay. PK Adventures LLC; az PK's Wild Ride Ltd; ba. Rothstein Family Foundation; bb. RRA Consulting Inc.; be. RRA Goal Line Management LLC; bd. RRA Sports and Entertainment LLC; 30 EFTA00596554 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 31 of 36 be. RSA I 1' Street LLC; bf. RW Collections LLC; bg. S & KEA LLC; bh. Scorh LLC; bi. Tipp LLC; bj. VGS LLC; bk. The Walter Family LLC; bl. Walter Industries LLC; bm. WPBRS LLC; bn. WAWW; bo. WAWW 2 LLC; bp. WAWW 3 LLC; bq. WAWW 4 LLC; br. WAWW 5 LLC; bs. WAWW 6 LLC; bt. WAWW 7 LLC; bu. WAWW 8 LLC; by. WAWW 9 LLC; bw, WAWW 10 LLC; bx. WAWW 11 LLC; by. WAWW 12 LLC; bz. WAWW 14 LLC; 31 EFTA00596555 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 32 of 36 ca. WAWW 15 LLC; cb. WAWW 16 LLC; cc. WAWW 17 LLC; cd. WAWW 18 LLC; ce. WAWW 19 LLC; cf. WAWW 20 LLC; cg. WAWW 21 LLC; ch. WAWW 22 LLC; ci. JB Boca M Holdings LLC; and G. Contributions ("C"), hereinafter collectively referred to as "the defendant contributions:" (CI) $6,000 in campaign contributions made to Alex Sink and voluntarily offered, and turned over, to the United States on behalf of Alex Sink; (C2) $40,000 in campaign contributions to Republican Party of Florida, "Florida" account and voluntarily offered, and turned over, to the United States by the Republican Party of Florida; (C3) $10,000 in campaign contributions to Republican Party of Florida, "Federal" account and voluntarily offered, and turned over, to the United States by the Republican Party of Florida; (C4) $90,000 in campaign contributions to Republican Party of Florida and voluntarily offered, and turned over, to the United States by the Republican Party of Florida; 32 EFTA00596556 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 33 of 36 (CS) $5,000 in campaign contributions to Republican Party of Florida by Rothstein business entity known as WAWW and voluntarily offered, and turned over, to the United States by the Republican Party of Florida; (C6) $800,000 Charitable Donation to Joe DiMaggio Children's Hospital, which hospital voluntarily advised the United States of the donation from the Rothstein Family Foundation, for the purpose of facilitating forfeiture; (C7) S1,000,000 Charitable Donation to Holy Cross Hospital, which hospital voluntarily advised the United States of the donation from the Rothstein Family Foundation, for the purpose of facilitating forfeiture; (CS) 59,600 in campaign contributions to Governor Charlie Crist, voluntarily offered, and turned over, to the United States by the office of Charlie Crist; and (C9) All funds voluntarily turned over to the United States (IRS/FBI), since in or about October 28, 2009, in response to publicity regarding Scott W. Rothstein. 6. If any of the property described above as being subject to forfeiture, as a result of any act and omission of the defendant - i. cannot be located upon the exercise of due diligence; ii. has been transferred or sold to, or deposited with, a third party; iii. has been placed beyond the jurisdiction of the court; iv. has been substantially diminished in value; or v. has been commingled with other property which cannot be divided without difficulty; it is the intent of the United States, pursuant to Title 18, United States Code, Section 1963(m), and pursuant to Title 21, United States Code, Section 853(p), made applicable hereto by Tide 18, United 33 EFTA00596557 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 34 of 36 States Code, Section 982(b), and pursuant to Rule 32.2 Fed. R. Crim. P., to seek forfeiture of any other property of said defendant up to the value of the forfeitable property described above. All pursuant to Title 18, United States Code, Section 1963, Title 18, United States Code, Section 982(a)(I) and Title 18, United States Code, Section 981(a)(1)(C) made applicable through Title 28, United States Code, Section 2461; and the procedures outlined at Title 21, United States Code, Section 853. " 1. 0#0.10 JEFFREY H. SLOMAN ACTING UNITED STATES ATTORNEY PAUL F. SCHWARTZ ASSISTANT UNITED STATES ATTORNEY FERE N. KAPLAN ASSIS ANT UNITED STATES ATTORNEY A CE D. eaV -CO ASSISTANT UNITED STATES ATTORNEY 34 EFTA00596558 Case 0:09-cr-60331-JIC Document 1 Entered on FLD D' ocket 12/01/2009 Page 35 of 36 UNITED STATES DISTRICT COUR SOUTHERN DISTRICT OF FLORIDA UNITED STATES OF AMERICA CASE NO. vs. CERTIFICATE OF TRIAL ATTORNEY* SCOTT W. ROTHSTEIN Defendant. Superseding Case Information: Court Division: (select one) New Defendant(s) Yes _X__ _No Number of New Defendants Miami — W Key West Total number of counts . Elk _ PB — FTP I do hereby certify that: 1. I have carefully considered the allegations of the indictment, the number of defendants, the number of probable witnesses and the legal complexities of the Indictment/Information attached hereto. 2. I am aware that the information supplied on this statement will be relied upon by the Judges of this Court in settiry their calendars and scheduting criminal trials under the mandate of the Speedy TrialAct, Title 28 U.S.G. Section 3161. 3. Interpreter: (Yes or No) List language and/or dialect 4. This case will take _IL_ days for the parties to try. 5. Please check appropriate category and type of offense listed below: (Chock tati orwol (Chock My one) I 0 to 5 days _X__ Petty II 6 to 10 days Minor III 11 to 20 days Misdem. IV 21 to 60 days Felony V 61 days and over 6. Has this case been previously filed in this District Court? (Yes or No) _No — If yes: Judge: Case No. (Attach copy of dispositive order) Has a complaint been filed in this matter? (Yes or No) Nn If es: Magy istrate Case No. Related Miscellaneous numbers: Defendant(s) in federal custody as of Defendant(s) in slate custody as of Rule 20 from the District of Is this a potential death penalty case? (Yes or No) 7. Does this case originate from a matter pending in the U.S. Attorney's Office prior to April 1, 2003? ___ Yes No 8. Does this case originate from a matter pending in the U. S. Attorney's Office prior to April 1, 1999? — Yes 1_ No If yes, was it pending in the Central Region? — Yes No 9. Does this case originatefrom a matter pending in the Northern Region of the U.S. Attorneys Office prior to October 14, 2003? _ Yes )C No 10. Does this case originate from a matter pending in the Narcotics Section (Miami) prior to May 18, 2003? Yes _X_ No 11. Does this case originate from a matter pending in the Central Region of the U.S. Attorney's Office prior to September 1, 2007? _ Yes _X_ No LaVlddhio ASSISTA T UNITED STATES ATTORNEY Florida Bar No. A005500030 arA ....Su. EFTA00596559 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 36 of 36 • UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF FLORIDA PENALTY SHEET Defendant's Name: SCOTT W. ROTHSTEIN Count #: 1 18 U.S.C. § 1962(d); RICO Conspiracy; * Max.Penalty: 20 years imprisonment, $250,000 fine Count #: 2 18 U.S.C. § 1956(h); Conspiracy to Commit Money Laundering; • Max.Penalty: 20 years imprisonment, $500,000 fine or twice the value of the property involved in the transaction. Count #: 3 18 U.S.C. § 1349; Conspiracy to Commit Mail Fraud and Wire Fraud; * Max.Penalty: 20 years imprisonment, $250,000 fine Counts #: 4-5 18 U.S.C. §§ 2; 1343; Wire Fraud * Max.Penalty: 20 years imprisonment, $250,000 fine *Refers only to possible term of incarceration, does not include possible fines, restitution, special assessments, parole terms, or forfeitures that may be applicable. EFTA00596560 • IN THE CIRCUIT COURT OF THE SEVENTEENTH JUDICIAL CIRCUIT IN AND FOR BROWARD COUNTY, FLORIDA COMPLEX BUSINESS DIVISION CASE NO. 09 059301 STUART A. ROSENFELDT, individually, and ROTHSTEIN ROSENFELDT ADLER, P.A., a Florida Professional Service Corporation, Plaintiffs, v. SCOTT W. ROTHSTEIN, individually, Defendant ►MENDED COMPLAINT FOR DISSOLUTION AND FOR EMERGENCY TRANSFER OF CORPORATE POWERS TO STUART A. ROSENFELDT, OR, IN THE ALTERNATIVE, FOR APPOINTMENT OF A CUSTODIAN OR RECEIVER Plaintiffs, Stuart A. Rosenfeldt, individually, and Rothstein Rosenfeldt Adler, P.A. (sometimes referred to as the "firm"), file this action against Scott W. Rothstein, and allege as follows: PRELIMINARY STATEMENT It is with surprise and sorrow that the attorneys of Rothstein Rosenfeldt Adler, P.A. have learned that Scott W. Rothstein, the managing partner and CEO of the firm, has, according to assertions of certain investors, allegedly orchestrated a substantial misappropriation of funds from investor trust accounts that made use of the law firm's name. The investment business created and operated by Mr. Rothstein centered around the sale of interests in structured settlements. Immediate judicial action is being sought to facilitate the investigation and • EXHIBIT a COFFEY 13 URLINOTON OFFICII IN MtGROVR, PILNTHOUSE 2699 SOUTH BAYSMORII DRIVil MIAMI, FI,ORIDA 33 I 33 T: F: Email: InfoecoffeyburlIngton.cam www.coffayburlington.com EFTA00596561 accounting of investor funds and to address the ongoing affairs of the firm in an appropriate manner through the transfer of all corporate powers to Stuart A. Rosenfeldt. Mr. Rosenfeldt, as the firm's President and only other equity holder in the firm besides Mr. Rothstein, is uniquely positioned to wind down the affairs of the firm, to account for all funds in the firm's trust accounts, and, most importantly, to protect the interests of the firm's clients. In the alternative, Plaintiffs request that the Court appoint Mr. Rosenfeldt as custodian of the firm during its dissolution or appoint a receiver. In the event that the Court appoints a receiver, there is no necessity for the receiver to assume any control of the firm's law practice because the dedicated attorneys and staff are continuing to assure that the interests of the firm's clients will remain paramount and will be fully protected. Mr. Rosenfeldt and the firm have filed this action to minimize any further damage caused by Mr. Rothstein, to emphasize that the innocent attorneys and staff of the firm are not implicited in this controversy, and, most importantly, to protect the best interests of their clients. NATURE OF ACTION 1. This is an action for judicial dissolution of the firm and an accounting pursuant to Florida Statutes Section 607.1430(3). Additionally, Plaintiffs seek transfer of all corporate powers to Plaintiff Rosenfeldt, or, in the alternative, the appointment of Plaintiff Rosenfeldt as custodian of the firm or the appointment of a receiver, pursuant to Florida Statutes Sections 607.1431 and 607.1432. 2. Plaintiff Rosenfeldt is the firm's president. He has the inherent authority to initiate this emergency litigation. 3. Defendant Rothstein is the firm's managing partner and CEO. Rothstein, a charismatic and talented lawyer, has controlled firm management, especially financial matters, 2 COFFEY BURLINGTON OFFICE IN THE GROVE, PENTHOUSE 2699 SOUTH BAYSHO%E DRIVE MIAMI. FLORIDA 33133 T: MM. F: www.coffeyburlington.com infoecoffeylnrlingion.com EFTA00596562 and has not extended access to core financial matters and records to any other attorney at the firm. 4. Plaintiff Rosenfeldt and Defendant Rothstein are the sole owners of the equity in the firm. 5. The firm's principal office is located at 401 East Las Olas Blvd, Suite 1650, Fort Lauderdale, FL 33301. 6. Venue properly lies with this Court because the firm's principal office is in Broward County. BACKGROUND AND GROUNDS FOR DISSOLUTION The Firm 7. The firm was founded by Plaintiff Rosenfeldt and Defendant Rothstein in 2002. 8. The firm's practice was originally focused on labor and employment law, but the law, firm grew rapidly and its practice areas expanded to include intellectual property, corporate mergers arid acquisitions, real estate, criminal defense, class actions, mass torts and personal injury claims, among others. 9. The firm currently has seven offices, with locations in Florida, New York, and Venezuela, and employs over 70 lawyers. 10. The firm has an outstanding group of attorneys, staff members, including distinguished former judges, many of whom have statewide, even national reputations, for professional excellence. The Settlement Funding Scheme II. Firm lawyers learned in the past few days about irregularities surrounding a settlement funding business operated by Rothstein. The settlement funding business involved 3 COFFEY B URLINGTON OFFICE IN THE GROVE, PENTHOUSE 2699 SOUTH BAYSHORE DRIVE MIAMI, FLORIDA 33133 T: F: 305.858.526 Email: www.coffeyburlington.com EFTA00596563 the purchase of structured legal settlements and the sale of these settlements to investors. Various investors have informed the firm that they believe that substantial funds are not properly accounted for and are missing. A review of the limits records undertaken over this past weekend indicates that various funds unrelated to the direct practice of law cannot be accounted for, circumstances suggesting that investor money may have been misused by Rothstein who controlled all such accounts. Some investors allege that Defendant Rothstein may have been fabricating non-existent structured legal settlements for sale to investors. 12. Defendant Rothstein's allegedly improper activities were done without any knowledge of the other attorneys at the fum, and, in fact, Rothstein actively endeavored to hide the existence of the scheme. It was not until several days ago that Plaintiff Rosenfeldt or any of the other lawyers at the firm discovered some of the circumstances concerning Defendant Rothstein's actions and the alleged improprieties. 13. The fun's attorneys still have extremely limited knowledge concerning the allegations, and yet, recognize the importance of proceeding expeditiously to undercover the truth. Thus, the emergency transfer of all corporate powers to Plaintiff Rosenfeldt, or, in the alternative, the emergency appointment of Plaintiff Rosenfeldt as the furn's custodian or the appointment of a receiver, is critical to undertake at least a preliminary inquiry concerning Defendant Rothstein's conduct, and to make appropriate recommendations to the Court concerning any further investigation. Misuse of the Investor Trust Accounts 14. With respect to the settlement funding scenario, Plaintiffs only recently discovered troubling information concerning Defendant Rothstein's investor trust accounts and details surrounding the transactions are still emerging. However, it appears that Defendant 4 COFFEY B uRLINGToN OFFICE IN Tee OK(Mit, Pnitimaus:-. 2699 Sou:rm BAYSHOKIS DRIVt MIAMI, FLORIDA 33133 T. F: Email: www.cotfeyburlington.com EFTA00596564 Rothstein may have transferred substantial sums out of the investor trust accounts, and that the emergency transfer of all corporate powers to Plaintiff Rosenfeldt, or, in the alternative, the emergency appointment of Plaintiff Rosenfeldt as the firm's custodian or the appointment of a receiver, is necessary to account for and, if appropriate, consider taking action to recover the missing investor trust account funds. Shareholder Deadlock 15. Defendant Rothstein has declined to resign despite the asserted and substantial irregularities because he purports to hold a 50% share of the law firm. For this reason, among others, there is a substantial shareholder deadlock, making management of the firm as it currently stands impossible. COUNT I (DISSOLUTION) 16. Plaintiffs adopt, incorporate, and reallege paragraphs 1-15. 17. Under Florida Statute 607.1430, a circuit court may dissolve a corporation in a proceeding by a shareholder if the management of corporate affairs is deadlocked and irreparable injury to the corporation is threatened or being suffered. Additionally, a circuit court may dissolve a corporation having 35 or fewer shareholders if a sufficient showing is made with respect, to improper or irregular conduct that materially injures the corporation. 18. For the reasons stated herein, Plaintiffs have demonstrated these two grounds for dissolving the firm. WHEREFORE, Plaintiffs demand judgment of dissolution and all other such remedies that the Court finds appropriate. 5 COFFEY B URLINGTON OFFICE tN THE GROVE. PENTHOUSE 2699 SC,ITH BAY SHORE DRIVE MIAMI, FLORIDA 33133 F: Email: www.colleyburlington.com EFTA00596565 COUNT II (TRANSF ER OF CORPORA TE POWER TO PLAINTIFF ROSENFELDT) 19. Plaintiffs adopt, incorporate, and re,allege paragraphs 1-18. 20. Florida Statute 607.1431(3) permits a court in dissolution proceedings to take any action required to preserve the corporate assets wherever located, and carry on the business of the corporation. 21. For the reasons stated herein, Plaintiffs submit that the Court's exercise of this discretionary power is appropriate to transfer all corporate power over the firm to Plaintiff Rosenfeldt to effect the dissolution request in Count I, to perform an accounting of the firm's assets and liabilities, to undertake all actions necessary to uncover the extent of Defendant Rothstein's activities, to wind down the firm's client engagements, to appoint a chief restructuring officer and an inventory attorney pursuant to Florida Bar Rule 1-3.8, to institute federal bankruptcy proceedings or other related state law proceedings, to file assignments for the benefits of creditors, and to undertake all such other actions as may be necessary and appropriate under law. WHEREFORE, Plaintiffs demand that the Court transfer all corporate power over the firm to Plaintiff Rosenfeldt. COUNT Ill (IN TEE ALTERNA TIVE, APPOINTMENT OF PLAINTIFF ROSENFELDT AS CUSTODIAN OF THE FIRM) 22. Plaintiffs adopt, incorporate, and reallege paragraphs 1-18. 23. Florida Statutes 607.1431(3) and 607.1432 permit a circuit court in a judicial dissolution to appoint a custodian to manage the business and affairs of the dissolving corporation. 6 COFFEY B URLINGTON OFFICE In Tile GROVE, PENTHOUSF. 2699 Sow' BAYSHORII DRIVE MIAMI, FLORIDA 33133 T: F: Email: www.cotfeyburl ington.com EFTA00596566 24. For the reasons stated herein, Plaintiffs request, in the alternative to Counts II and IV, that the Court appoint Plaintiff Rosenfeldt, the President of the firm and sole shareholder besides Defendant Rothstein, as custodian of the Firm to effect the dissolution requested in Count I, to perform an accounting of the firm's assets and liabilities, to undertake all actions necessary to uncover the extent of Defendant Rothstein's activities, to wind down the firm's client engagements, to appoint a chief restructuring officer and an inventory attorney pursuant to Florida Bar Rule 1-3.8, to institute federal bankruptcy proceedings or other related state law proceedings, to file assignments for the benefits of creditors, and to undertake all such other actions as may be necessary and appropriate under law. WHEREFORE, Plaintiffs demand, in the alternative, that the Court appoint COUNT IV f IN THE ALTERNA TIVE, APPOINTMENT OF A RECEIVER) 25. Plaintiffs adopt, incorporate, and reallege paragraphs 1-18. 26. Florida Statutes 607.1431(3) and 607.1432 permit a circuit court in a judicial dissolution to appoint a receiver to wind up and liquidate the business and affairs of the dissolving corporation. 27. For the reasons stated herein, Plaintiffs request, in the alternative to Counts II and 111, that the Court appoint a receiver to effect the dissolution requested in Count I, perform an accounting of the firm's assets and liabilities, undertake all actions necessary to uncover the extent of Defendant Rothstein's activities, and to undertake all such other actions as may be necessary and appropriate under law. 7 COFFEY B URLINGTON .Oaaica. Taa GROVE, PENTHOUSE 2699 SOUTH BAYSHORE DRIVE. MIAMI, FLORIDA 33133 T: F: Email: www.cotteyborlington.com EFTA00596567 CONCLUSION 28. Defendant Rothstein's conduct in connection with the settlement funding and the investor trust accounts appears at this point to be extensive. Dissolution and the emergency transfer of all corporate powers to Plaintiff Rosenfeldt, or, in the alternative, the emergency appointment of Plaintiff Rosenfeldt as the fum's custodian or the appointment of receiver, are critical to uncover the full extent of Defendant Rothstein's activities, to consider any appropriate action to recover missing proceeds, to protect the firm's clients, and to preserve, protect and review the firm's accounts and financial records.' Dated this 3rd day of November, 2009. Respectfully submitted, COFFEY BURLINGTON Counsel for Plaintiffs 2699 South Bayshore Drive, Penthouse Miami. Florida 33133 Annexed hereto as Exhibit A is an affidavit from Plaintiff Rosenfeldt attesting to the truthfulness of the allegations contained herein. COFFEY B UR L IN GTON OFFICE (N THE GROVE. PENTHOUSE 2699 SOUTH BAYSHORE DRIVE MIAMI, FLORIDA 33133 T: F: Email: www.cof eyborlington.com EFTA00596568 CERTIFICATE OF SERVICE I certify that on this 3rd day of November, 2009, with the agreement and consent of Defendant Scott W. Rothstein's counsel, Mark Nurik E a true and correct copy of the above and foregoing was served via email on Mr. Nurik, at This 3rd day of November, 2009. S s; 9 COFFEY B URLINGTON OI+ICk IN THE DROVE. PENTHOUSE 2699 SOUTH SAYSHORE DRIVE MIAMI, FLORIDA 33 133 T: P: Email: www.coffeyburlington.com EFTA00596569