Posted Dec 21, 2009 08:13 pm CST
In the latest development in an ongoing investigation of the alleged $1.2 billion Ponzi scheme that disbarred attorney Scott Rothstein is accused of masterminding, federal authorities are now reportedly probing whether campaign-finance laws were violated by other attorneys in his now-defunct Florida law firm.
Rothstein may have funneled money from the Ponzi scheme to other lawyers at Rothstein Rosenfeldt Adler, in the expectation that they would make hefty campaign donations in exchange for these bonuses, reports the Miami Herald. If so, this likely was an election law violation.
If RRA attorneys were required to make political donations in exchange for receiving law firm bonuses, “that should have been a tip-off that they were violating campaign finance laws,” says law professor Robert Jarvis of Nova Southeastern University.
“Even if they didn’t know anything about the Ponzi scheme, they certainly knew this was wrong,” he tells the newspaper, adding that attorneys in this position have “real exposure” to potential charges of fraud, money-laundering and tax evasion. “It’s a very difficult case to defend against,” says Jarvis.
A total of some $2.2 million was donated between 2005 and 2009 by 30 RRA lawyers along with 15 other employees, spouses and relatives, the newspaper reports. Nearly 40 percent went to the 2008 McCain-Palin campaign, which transferred some of the money to other Republican candidates.
However, several RRA attorneys contacted by the Herald said themselves, or through their legal counsel, that they had done nothing wrong.
Meanwhile, the situation apparently has motivated some politicians to increase the amount of money they are reimbursing to the law firm: A number are now planning to return not only contributions directly tied to Rothstein but money from other lawyers at RRA, according to the Herald.
Florida Gov. Charlie Crist announced last week that he plans to return a little over $76,000 that he received from 35 lawyers and employees at RRA. He previously reimbursed a little under $10,000 that he had received from Rothstein and his wife, the Herald reported Friday.
ABAJournal.com: “Filing: Rothstein Made $35M in 2008; Name Partner: I Wasn’t Paid $6M”
ABAJournal.com: “Rothstein Faces New Malpractice Suit; Auction at Replica Law Office Planned”
Miami Herald (opinion): “Probe link between Scott Rothstein, Frank Adderley”
South Florida Business Journal: “Crist praised for returning Rothstein cash”