Not a Lexis+ subscriber? Try it out for free.

Banking and Finance

Florida Lawyer Gets 3-Year Sentence For Helping Ponzi Schemer's Wife Hide $1 Million in Jewelry

 A Florida lawyer will spend the next three years in federal prison for assisting the wife of convicted Ponzi schemer Scott Rothstein hide more than $1 million in jewelry - including a 12.08 carat yellow diamond ring valued at nearly $500,000. Scott Saidel, 46, received the sentence from U.S. District Judge Robin Rosenbaum after previously pleading guilty to a single count of conspiracy to commit money laundering back in January. Judge Rosenbaum noted Saidel's role as an attorney in fashioning the sentence, observing that Saidel's efforts were designed to prevent the approximately $1 million in assets from being used to compensate Rothstein's victims. Saidel was previously disbarred from the practice of law.

Days after authorities learned that Scott Rothstein had been operating a massive Ponzi scheme, federal agents went to Rothstein's house to collect all cash and assets that were believed to have been purchased with scheme proceeds. Kim Rothstein assisted agents in retrieving the assets, which included jewelry and numerous luxury watches - nearly all of which were later auctioned off by the U.S. Treasury. However, Kim Rothstein and several others, including Saidel, concealed the existence of numerous pieces of jewelry from federal authorities, including a 12.08 carat yellow diamond that Rothstein had recently purchased for approximately $400,000. Additionally, Kim Rothstein also failed to turn over:

  • An engagement ring and wedding band with 18 emerald cut diamonds;
  • 10 watches, including a Rolex with leopard design, a woman's Piaget and a platinum/diamond Pierre Kunz;
  • 5 sets of earrings, several necklaces, and a variety of gold coins; and
  • Pearl, diamond, and sapphire cufflinks, and 50 1-ounce gold bars

After the items were withheld from authorities, Rothstein and two others attempted to sell several of the pieces to local jewelers. Saidel agreed to hold some of the proceeds from the sale in his attorney trust account to prevent their disclosure to investigators. Even Scott Rothstein was pressured to lie to investigators about the whereabouts of the missing jewelry (and was rumored to have refused to do so). 

However, court-appointed bankruptcy trustee Herbert Stettin and his team soon began to discover several missing pieces of jewelry during their investigation, and authorities later charged Kim Rothstein, Saidel, and several others, including two local jewelers they alleged were complicit in the scheme. Both Rothstein and Saidel entered into plea agreements with prosecutors - with Saidel agreeing to forfeit over $500,000 to authorities that included (1) $65,000 in legal fees paid by Kim Rothstein; (2) four expensive pens; and (3) a pair of mother of pearl, diamond, and sapphire cuff links. 

Kim Rothstein has remained free on bail while her sentencing has been repeatedly delayed, and is currently scheduled to be sentenced November 12, 2013. The most recent delay came before her scheduled sentencing on October 7, 2013, with her lawyers seeking the delay so she could testify against the two jewelers accused of helping her sell the jewelry. After granting that delay, Judge Rosenbaum warned Rothstein's lawyers that no more delays will be granted.

For more news and analysis of Ponzi schemes, visit Ponzitracker, a blog by Jordan Maglich, an attorney at Wiand Guerra King P.L.

For more information about LexisNexis products and solutions connect with us through our corporate site.