Ponzi schemer Scott Rothstein's former law partner,
Stuart Rosenfeldt has agreed to settle a $10 million lawsuit against him for a
fraction of the complaint, only $1.6 million. The settlement was disclosed
Thursday in a settlement agreement filed in the bankruptcy of Rothstein and
Rosenfeldt's former law firm, Rothstein Rosenfeldt Adler.
But, here's the bizarre part: Stuart is getting the money
to fund the settlement from a tax refund of $3.97 million by the IRS for
reasons no one is explaining.
The bankruptcy trustee has alleged in a lawsuit that
Stuart was overpaid, and received loans and gifts with money from Rothstein's
$1.2 billion Ponzi scheme.
Don't these alleged facts explain the enormous refund?
Don't these facts cry out that he's receiving money back from the government
that he may have received from the proceeds of Ponzi Scheme!?!? And this money
is absolving him from any liability in the lawsuit rather than implicating him more?
I would think this enormous payment from the IRS would
raise red flags for all involved rather than getting him off the hook. Consider
this: If $3.97 million were the entire amount Stuart paid in taxes over the
last 10 years, that would mean he made and claimed over $10 million in
compensation over those 10 years. He more than likely would not be getting all
his tax back so he must have claimed compensation far in excess of $10 million.
Scott Rothstein, now in federal prison, is clearly the man behind the Ponzi
scheme as his ultra-extravagant lifestyle demonstrated. But, perhaps some of
his partners received some of the unlawful gain.
Maybe the bankruptcy trustee should get to the bottom of
such an enormous refund before being too quick to settle?
articles about consumer debt by Ted Connolly, co-author of The Road Out of Debt
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