Published June 03, 2010
FORT LAUDERDALE, Fla. – FORT LAUDERDALE, Fla. (AP) — Some of the flashier spoils of disbarred attorney Scott Rothstein's massive Ponzi scheme were auctioned Thursday for $5.8 million, with the money earmarked by the government to repay investors for some of their losses.
The items sold included an 87-foot Warren yacht that went for $2.5 million, several smaller boats and 11 vehicles, including a Bugatti, a Rolls Royce, two Ferraris and a Bentley. They were seized by the Treasury Department just as Rothstein's scam was falling apart last fall.
Rothstein is scheduled to be sentenced June 9 after pleading guilty to five felony charges. Prosecutors say he orchestrated a $1.2 billion Ponzi scheme by promising people fat profits through investments in supposedly confidential legal settlements that were actually fictional.
Rothstein's law firm imploded shortly after his Ponzi scheme collapsed last fall. The charges he pleaded guilty to carry maximum prison sentences totaling 100 years, but the 47-year-old Rothstein could get a lighter term because he went undercover to help the FBI arrest a suspected Mafia figure with ties to New York and Sicilian crime families.
So far, the only other person charged with a crime is Rothstein's former chief operating officer, Debra Villegas, 42, who faces a money laundering conspiracy count and is scheduled to plead guilty later this month, according to court documents.
Hundreds of investors have come forward to claim losses from the scam. The money raised through sale of Rothstein's assets, including 24 homes that have yet to be listed, will be used as restitution to the victims, said Danny Auer, chief of the Internal Revenue Service's Criminal Investigative Division in Miami.
"The effort here is to get money back in the hands of the victims who were defrauded," Auer said.
More than 220 people registered to bid at Thursday's auction, including Ira Eskow of Lake Worth. Eskow bought a cream-colored 2009 Bentley Contintental GTC for $179,000 for a senior executive at his company.
"He really wanted that particular car. If it was black, maybe he wouldn't have wanted it," Eskow said. "I guess it's a good deal. It's not new."
Some of the most spirited bidding took place over a 2008 Bugatti Veyron, one of the world's most expensive cars that retails new for upward of $1.7 million and boasts a top speed of 253 mph. The blue-and-black Bugatti once owned by Rothstein sold for $858,000.
The IRS has three days to accept or reject the bids.
Auctioneer Rick Levin, of the Chicago firm Rick Levin & Associates, said the impressive array of high-end automobiles and yachts made the Rothstein auction unusual, even for someone who makes a good chunk of his living selling ill-gotten assets for the government.
"The aren't too many auctions that have this wide of an assortment of stuff," Levin said. "There's someone in the world who's interested in all of it."
In addition to the assets seized by the government, politicians and political parties in Florida returned hundreds of thousands of dollars in contributions made by Rothstein and his wife, Kim.