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Prosecutors seek to forfeit more than $75 million in Rothstein assets

By Peter Franceschina
Sun Sentinel

Federal prosecutors took their next step Monday in stripping Ponzi schemer Scott Rothstein of all the worldly possessions he left behind when his massive fraud scheme blew up last fall.

Rothstein had already agreed to give up tens of millions of dollars in cash, multimillion dollar homes, exotic sports cars, hundreds of pieces of jewelry, and his interests in dozens of businesses as part of his January plea agreement.

But there has been little action on the forfeiture front, as prosecutors and the bankruptcy trustee for Rothstein’s defunct law firm have quietly battled behind the scenes over control of the assets caught up in the criminal case.

U.S. District Judge James Cohn, who is overseeing the criminal case, ordered prosecutors to make a decision by 2 p.m. Monday on whether they would seek forfeiture of the assets.

Prosecutors beat the deadline, and they have targeted more than $75 million in assets.

They are seeking to lay claim to 24 properties Rothstein either owned or had an interest in, for which he paid $47 million; 20 exotic cars, including Ferraris, Lamborghinis and Bentleys; three yachts worth more than $5 million; more than 300 pieces of jewelry, including watches, necklaces and earrings; 20 bank accounts containing $20 million; and Rothstein’s interests in two dozen businesses and more than 100 corporations.

The filing of the court documents sets the next stage in the forfeiture proceedings. The bankruptcy trustee has repeatedly claimed in court filings that the assets seized by prosecutors actually belong to Rothstein’s law firm, because Rothstein used funds that flowed through his law firm trust accounts to run his Ponzi and buy the assets. Similar disputes have taken place in the Bernard Madoff Ponzi scheme and other fraud cases.

If the judge approves the prosecution’s motion for forfeiture, the bankruptcy trustee can then begin filing legal claims against the assets.

Rothstein, 47, pleaded guilty to five federal felonies and faces up to 100 years in prison at his May 6 sentencing. He is the only one to be charged so far in the far-reaching federal investigation.

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Are they going to take back the houses and cars and money from the wife too?

The wife is descent good person who has done a lot of good for our city. She is brave and honorable and should be able to keep the house and the jewelry that was given to her.

I got a necklace to give her, She can keep that!

The wife can be a Nun. That doesn't mean that she deserves the ill-gotten gains of her spouse. Making a cloudy paper trail is part of what people like Rothstein, Madoff, as well as other mega-wealthy individuals do to protect things from those that have been sce#$@d.

In a perfect world she might be entitled to keeping her gifts or assests. However, unlikely in a world where lawyers need fodder for their mills and where justice needs currency to cover deficets. Not to mention the reimbursement for those poor victims. One is left to wonder... Who deserves what. Lawyers can legally swollow all of it. Government can easily run an investigation costing just about all of it and victims never recover their investments or losses so go figure!

brave and honerable? she's a gold digger who lived the high life attending parties. when your "title" is socialite you've already lost all self respect

TCP: you say:" She is brave and honorable and should be able to keep the house and the jewelry that was given to her".
You have no moral compass, institutions that help the eldery, sick people had to turn back the money they got from Rothstein, and you say she has the right to keep the jewelry? She is disposable as a human being. Do yourself a favor: think, you sre still on time.

The wife should go to prison as well, she lived the high life along with her husband fueled by the money that he plundered from his investors. She is not as guilty as he is but she is still a criminal who benefited from a criminal enterprise.

I saw Joe Alu at the Publix on Sunrise and NE 15th Ave last week. Looked much skinnier and was moving about as if he was being watched.

What a great blog! It's a pity that i can't find your rrs address. If you can offer rrs subscription service, i can track your blog easier!

Great content and it's so helpful for me. But it's so weird that your blog is in a mess through my explorer. Is that my explorer problem? But it's pretty normal when exploring other blogs.

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