MIAMI, (Reuters) – Federal agents investigating a prominent Florida lawyer suspected of running an elaborate Ponzi scheme said yesterday the amount involved could exceed $1 billion, and they asked bilked investors to come forward.
At a news conference, investigators from the FBI and the U.S. Internal Revenue Service (IRS) made a public appeal for information from individuals who had invested in a so-called Structured Settlement Investment scheme offered by 47-year-old Fort Lauderdale attorney Scott Rothstein.
Criminal charges have not yet been filed against Rothstein, who lived a luxury lifestyle and helped bankroll local politicians, campaign records show.
But a court document filed this week carried allegations that Rothstein masterminded a scheme in which he sold bogus or nonexistent legal settlements to unsuspecting investors since at least 2005.
It said new investor money was used to pay previous investors in the classic Ponzi scheme model.
Monday’s filing by the U.S. Attorney for the Southern District of Florida was used to justify the seizure of properties, luxury vehicles and a yacht belonging to Rothstein.
Appealing for cheated investors to come forward with information, John Gillies, Special Agent in Charge of the FBI Miami Division, said the fraud investigation was going to be one of the largest ever seen in South Florida.
