Rothstein, Kim - Wife of Ponzi Schemer Gets 18 ...
Kim Rothstein sentenced to 18 months in federal prison
Ponzi-schemer Scott Rothstein's wife admitted trying to hide assets, including a massive diamond, from federal agents
Kim Rothstein makes her way into the federal courthouse in Fort Lauderdale,… (Carline Jean, Sun Sentinel
)November 12, 2013 - By Paula McMahon, Sun Sentinel
Kim Rothstein traded her designer clothes for inmate scrubs on Tuesday after she was sentenced to 18 months in federal prison for trying to squirrel away more than $1 million worth of criminal assets from her husband's Ponzi scheme.
The soon-to-be ex-wife of Scott Rothstein cried in court and apologized to everyone negatively affected by the Rothstein name.
Rothstein, 39, admitted that she willingly agreed to try to secretly sell expensive jewelry and other valuables instead of turning them over to victims of her husband's $1.4 billion investment fraud.
Prosecutor Lawrence LaVecchio told the judge "the evidence supports that it was Mr. [Scott] Rothstein who came up with this idea" of hiding some of their ill-gotten assets from authorities.
Scott Rothstein did not decide to "come clean" about those hidden valuables, but became worried that Kim's friend and co-conspirator Stacie Weisman was secretly working as a government agent, LaVecchio said. Prosecutors said she was not at that time, but later did.
When Kim Rothstein was confronted by agents on June 17, 2012 — long after her husband had pleaded guilty and begun serving his 50-year prison term — she immediately confessed and started helping them. She then helped authorities track down all of the valuables and recover them "from her in-laws and co-conspirators," prosecutors said.
U.S. District Court Judge Robin Rosenbaum allowed Kim Rothstein to surrender at the Federal Detention Center in downtown Miami, provided she went there immediately and made the trip from the federal courthouse in Fort Lauderdale in her lawyer's car with no stops. She must also undergo mental health and substance abuse treatment in prison and serve two years of probation.
Though Rothstein could have tried to delay her surrender date, she offered to immediately turn herself in, saying she wanted to serve her punishment with dignity, continue getting therapy in prison and start anew when she is released. A friend wrote the judge that he has offered her a fresh start and a job as a manager with his healthy meals delivery company in North Carolina.
The U.S. Attorney's Office had recommended that she serve about two years in federal prison because she helped them prosecute four other defendants who have already pleaded guilty to related crimes. Prosecutors said she also cooperated in gathering evidence against other suspects, who may yet face charges.
"She must be punished for her behavior," said David Tucker, one of her defense lawyers, who suggested she serve less than 18 months. "She is not the poster child for a greedy Ponzi wife — how hurtful, how inaccurate."
In February, Rothstein pleaded guilty to conspiring to commit money laundering, obstruct justice and tamper with a witness.
Rothstein admitted that she tried to fence the expensive trinkets, including a rare 12.08-carat "fancy intense" yellow diamond, as a kind of insurance policy to pay her living expenses after her attorney husband returned from Morocco four years ago and admitted he'd been operating a $1.4 billion investment scam out of his law firm offices on Las Olas Boulevard. Part of the plan involved having Scott Rothstein lie under oath about some of the assets, prosecutors said.
Later on Tuesday, Weisman, 50, was sentenced to spend three months in federal prison, followed by nine months of house arrest with electronic monitoring and three years of supervised release. She must surrender by Jan. 3.
Weisman's lawyer, Alvin Entin, argued that she acted out of sincere concern for her friend, gained nothing personal from the crime and also cooperated with prosecutors. He also said she deserved credit for more than 10 years of extensive charitable work for cancer patients, childhood education and animals. Prosecutors said they believed Weisman thought she was helping Kim escape from an abusive husband before the Ponzi scheme imploded.
Kim Rothstein was charged last year — with her then-attorney Scott Saidel and Weisman. Saidel, 46, has been disbarred and is scheduled to begin serving three years in prison next week. Fort Lauderdale jeweler, Patrick Daoud, 55, and businessman Eddy Marin, 51, also pleaded guilty to related crimes and are to be sentenced in February.
Kim Rothstein has already agreed to pay $515,000 and turn over dozens of valuable items, including the massive diamond ring, her wedding and engagement rings and other jewelry, and numerous gold coins and gold bars. She recently filed for divorce from her husband of almost six years.
In court documents filed last week, Rothstein's defense lawyers Tucker and David Kotler portrayed their client as a pathetic figure who was almost as much a victim of her husband as his Ponzi scheme victims were. They said she was emotionally and physically abused by her husband and that he kept her in the dark about his illegal activities.
Kim Rothstein said she and her husband communicated in coded messages and letters they exchanged while he was in custody, supposedly cooperating with prosecutors and being debriefed by federal agents and bankruptcy authorities.
Scott Rothstein, 51, is serving a 50-year prison term at a secret location.
His mother and sister scribbled extensive notes during the sentencing but declined to comment on how he is doing in prison.
Little has been revealed about the convicted con man's life since he's been incarcerated because he also cooperated against other criminals. Several lawyers said the revelation that he was involved in hiding assets may not bode well for his hopes of getting some time taken off his prison term for helping the prosecution.