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Florida lawyer gets 50 years for Ponzi scheme

South Florida lawyer Scott Rothstein was sentenced to 50 years in prison Wednesday for masterminding a Ponzi scheme that bilked clients out of more than $1 billion.
/ Source: Reuters

South Florida Ponzi scheme mastermind Scott Rothstein was sentenced to 50 years in prison Wednesday for an investment fraud that bilked clients out of more than $1 billion.

The sentence was more than the 40 years federal prosecutors had recommended for Rothstein, a disbarred lawyer who pleaded guilty to racketeering and fraud conspiracy charges in January.

He had faced up to 100 years in prison but his lawyer had asked U.S. District Judge James Cohn to give him no more than 30 years.

Rothstein, 47, fled to Morocco as his fraud scheme imploded in late October, apparently lured by the fact that the country has no extradition treaty with the United States. He voluntarily returned to Florida in early November, however, and has been jailed since he surrendered to the FBI in December.

He was charged under a statute often used to prosecute organized crime chiefs.

The massive scope of Rothstein's scheme prompted some pundits to place him in company with other Ponzi scheme kingpins including Bernard Madoff, who pleaded guilty to a $65 billion investment fraud and is now serving a 150-year prison sentence.

Court documents have said Rothstein acted with co-conspirators to carry out the $1.2 billion scheme, creating false bank documents that conned investors while providing "gratuities to high-ranking members of police agencies" in order to deflect law enforcement scrutiny.

The alleged co-conspirators include Debra Villegas, the former chief operating officer of Rothstein's now defunct Fort Lauderdale law firm Rothstein, Rosenfeldt & Adler, who has been charged with engaging in a money laundering conspiracy linked to the fraud.

The cigar-chomping Rothstein, a frequent campaign contributor often photographed with local politicians, lived a lavish life with opulent homes and a fleet of foreign sports cars. He used his connections and charm to lure wealthy friends and patrons to invest with him.

Prosectors have said Rothstein's fraud centered on the sale of shares in fabricated legal settlements to unsuspecting investors since at least 2005 and used new investor money to pay previous investors in the classic Ponzi scheme model.