Investors in law firm chief's $1.2B swindle to get full repayment under OK'd bankruptcy plan
Posted Jul 12, 2013 03:05 pm CDT
As a bankruptcy judge on Thursday approved a liquidation plan for a South Florida law firm at a hearing attended by some 75 attorneys, those involved said at least some investors in the now-imprisoned former managing partner’s $1.2 billion swindle are expected to be repaid 100 cents on the dollar.
If so, that would be highly unusual–at the outset of the case the prediction was that those victimized by Scott Rothstein would perhaps get 5 cents for every dollar they had invested, reports the Sun-Sentinel.
Settlements by TD Bank, at which Rothstein and his firm, Rothstein Rosenfeldt Adler did business, and other defendants, as well as pending insurance claims, are expected to fund the liquidation plan, according to the newspaper and the South Florida Business Journal.
“For the first time in history, period, a bankruptcy trustee has returned 100 percent payout to the victims of a Pozni scheme,” said attorney Charles Lichtman in another South Florida Business Journal article. “It’s made more remarkable by the Rothstein Ponzi case being the fourth largest in history.”
Lichtman practices at Berger Singerman, the lead litigation counsel for trustee Herbert Stettin. He said Michael Goldberg, who serves as counsel to the unsecured creditors’ committee, played a key role in winning the agreement of all parties to the liquidation plan.
ABAJournal.com: “Imprisoned Ex-Attorney Scott Rothstein: Other Lawyers Had Some Knowledge of State’s Biggest Swindle”
ABAJournal.com: “Federal Judge Sanctions Law Firm and Client re Withheld Docs, Finds TD Bank Knew of Rothstein Fraud”
ABAJournal.com: “3rd Lawyer from Shuttered Rothstein Law Firm Is Disbarred After Criminal Conviction”
ABAJournal.com: “11th Circuit: Money in Rothstein law firm accounts can’t be forfeited to feds”
Updated at 10:30 a.m. to link to related ABAJournal.com coverage.