Broward Palm Beach News Blog

If you feel at all sorry for Fort Lauderdale businessman George Levin for apparently losing a great deal of his money -- or other people's money -- in Scott Rothstein's Ponzi scheme, you can stop now.

Levin with wife Sue

​Levin was behind the Banyon Investors Fund, which drew other hedge funds and investors into Rothstein's scheme at a dizzying pace. Estimates are that Levin helped bring $300 million Rothstein's way -- and Banyon was making outrageous returns in the process.

It seems clear that Levin drove more money to Rothstein than anyone else. But he didn't do it alone. Levin's chief operating officer at Banyon was Frank Preve, a fellow who had an office at the Rothstein Rosenfeldt Adler firm. Preve also happens to be a convicted felon (bank fraud), according to the lawsuit recently filed by Bill Scherer.  

You'd think the 69-year-old Levin would have known better than to hire a criminal to help run his hedge fund. And Levin definitely should have known that the shaky premise and ridiculous returns Rothstein's settlement deals was a fraud. 

They say it takes one to know one -- and Levin used to operate a big fraud himself.

When you dig into Levin's past, you find one of the saddest and most outrageous business and legal stories you'll ever see, one that involves a rampant fraud and a veritable martyr named Stuart Rado, a consumer activist federal prosecutors said Levin "literally pursued ... to his

Just got back from a Bill Scherer press shindig outside the courthouse and will have vids later, but first I'm just going to ring off some highlights from the suit he just filed against Scott Rothstein. Here's a link to the entire 147-page lawsuit.

Sun-Sentinel

Rothstein's High School Yearbook Photo

​ ​There's some good information on Rothstein's methods, including his playing on billionaire Jeffrey Epstein's sex scandal, and some newsflashes, like the fact that the chief operating officer of Banyon Income Fund, a major feeder to the Rothstein Ponzi scheme, is a convicted felon who kept an office at the Rothstein Rosenfledt Adler firm. Also included is a very telling email that Rothstein wrote to A.J. Discala, the Hollywood player and former husband of The Sopranos' Jamie-Lynn Sigler whose hedge fund dumped a reported $30 million into Rothstein's scheme. Rothstein ended the email, "Money never sleeps motherfucker :-)".

By the way, that's Rothstein's Boyd Anderson High yearbook picture at left, courtesy of the Sun-Sentinel. He graduated in 1980 and sang in the chorus. 

So here's some info from the suit:

The Plaintiffs

Scherer's plaintiffs are almost all linked to Fort Lauderdale businessman Doug Von Allmen. Between his companies, his wife, and stepson, Dean Kretschmar, Von Allmen's total tally runs to $105.5 million, all of it through the Banyon Income Fund.

The Von Allmen Dynastry Trust, overseen by wife Linda Von Allmen put in $7 million. Doug Von Allmen's company in Missouri, D&L Partners, put in $45 million. Kretschmar sank $8 million in the scheme. Two Delaware companies Razorback Funding LLC and D3 Capital Club LLC -- which were funded by the Von Allmens -- put in $32 million and $13.5 million respectively.

Also listed as a plaintiff in the case is BFMC Investment LLC, which is owned by businessman Barry Florescue (I listed Dana Scheer, who is listed as a manager in the firm, but I'm told he's just the registered agent). BFMC put $2.4 million into the scheme.

The Defendants

Scherer is suing Rothstein as the "principal conspirator" in the Ponzi scheme. "RRA's trust accounts were allegedly used to receive the putative defendants' settlement funds and used to receive investor payments," according to the lawsuit.

Then we get the co-conspirators who are also being sued. Scherer names former RRA general counsel David Boden as Rothstein's "right-hand

The Miami Herald found another investor in Scott Rothstein's Ponzi scheme, and the story has a couple of interesting parts.

First, Rothstein apparently answered his phone on Thursday. He told the Herald:  

"I keep seeing names on the Internet who were alleged investors of me and I have no idea who they are. There are sublayers of people doing very, very bad things to people in my name, so we shall see. Not that I didn't do something wrong, and I'm back here to fix it. I made a decision to come back from Morocco and do the right thing. I know people are laughing and saying he can't repay these people, and they are wrong.''

Well, that's reassuring. For a second there, I thought Rothstein might

​This story is getting almost surreal. A blog reader who worked on the recent renovation of Scott Rothstein's house on Isla Bahia Drive sent me photographs of the inside of the home taken during the job. That's

 Rothstein's personal toilet, and yes, the lid is made of gold.

After the jump is the "hers" version of the toilet along with a photo tour, but let's start with some commentary from the gracious reader who furnished the images. He didn't take the pictures himself; he was too afraid of being seen doing so on the extensive video camera surveillance system in the house. Here's what he wrote:  

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The house was over the top gaudy,  Lots of golds and deep reds and blue.  All the furniture was imported from italy and a team of folks came from italy to assemble it on site.  He had a theater room that had a custom made 2 tiered bed that was upholstered with cheetah print and all the hand carved wookworking on the walls. He had a cigar lounge with

Scott Rothstein's breakout month was October.

Rothstein with Ovi Levy

​During that month, the Ponzi scheming lawyer raised $232 million in October only to wired it all out of TD Bank accounts into a dizzying maze of businesses, says Fort Lauderdale attorney William Scherer, who is representing clients claiming losses totaling about $100 million in the scheme.

There are numerous rumors about who may have been on the receiving end of Rothstein's stolen fortune, but Scherer confirmed only one recipient so far: Ovadia "Ovi" Levy, Rothstein's good friend and partner in the Renato watch company.

I left a message with Levy, who refused comment when I called him two weeks ago, today. Sources say Levy, who joined Rothstein last year in supporting John McCain to the tune of about $15,000, also allegedly had invested millions in Rothstein's scheme. Scherer declined to say how much Rothstein wired to Levy before he fled to Morocco.

Levy is the son of mulitmillionaire hotelier Shimon Levy, whose holdings include the Sea Club Resort on Fort Lauderdale beach. Shimon Levy has had known ties to major Israeli organized crime figures in the past, according to published reports. He once spent a year in Israeli prison himself for

It's time to set a lot of people straight on what is going on with Scott Rothstein (and get a comment cleaner up here).

​One of the main things you hear when you bring him up is people who just can't believe he's "walking free." They point to the video I shot of Rothstein at Capital Grille and say, "Why is he running around drinking martinis after he's stolen hundreds of millions of dollars?"

Based on what I know about the way federal investigations generally work, which is between nothing and a whole lot, I can almost guarantee you that Rothstein is for all intents and purposes in federal custody already. He's in a hotel or safehouse somewhere outside his old stomping grounds of downtown Fort Lauderdale -- not the Riverside, for instance -- and, as others have already surmised, he's trying to shave some years off a life sentence.

Rothstein will of course not escape or go free. That is not an option. A getaway, via escape or plea bargain, by Rothstein would count as one of the largest blunders in federal law enforcement history. It can't happen. Plus, Rothstein already escaped with millions of dollars and was set up for the life of a rich fugitive in Morocco. Guess what? He came back. Life as a fugitive sucks. It's lonely, and it's scary. Takes a special kind of person to live as a fugitive, and Rothstein obviously isn't that kind of person. Plus, there's a good chance that some very angry and very heavy former associates might have

In addition to the laid-off employees at the Versace mansion, the Rothstein Rosenfeldt Adler law firm, and other former Scott Rothstein business, there are many others who are either looking for work or have lost sizable income due to the Ponzi blow-up.

Sifuentes

​Three of them are in this post. Start with Tom James Clothier saleswoman Romina Sifuentes. She sold all those suits to Rothstein, and rumors are that he paid in the six figures for them each year. I contacted Sifuentes, and after introducing myself, I didn't get a chance to even ask a question. "No comment," said Sifuentes, who is still on the job.

Another person out of luck is Andrew Barnett, son of socialite art dealer Bonnie Barnett. Barnett was working as Rothstein's director of corporate development, but his real job was to drum up money for Rothstein's investment scheme. Word is that he's still waiting for a $400,000 commission check that he'll surely never see. I reached Barnett on the phone, and he said he didn't want to comment. "I don't want to answer any questions; I had no idea what was

A good source has been telling me for the past week that Scott Rothstein began wiring large sums of money out of the country during the weeks before he fled to Morocco. He told me that his sources at TD Bank put the figure at $200 million total -- including the $16 million to $18 million he allegedly wired just before leaving the country on October 27 -- and that most of it appeared to have gone to Morocco.

This morning, the Miami Herald is reporting a similar figure from federal sources, who say Rothstein accessed investors' TD accounts via computer to move the money out of the country. There are a whole lot of questions hanging in the air. The most obvious: Where did all that money go, and will it be returned?

The investor whose story with Rothstein has been detailed in parts I and II of this series hopes so. His investment money -- along with others who pooled together millions of dollars with him -- was in those TD Bank accounts that Rothstein allegedly raided.

During the course of hammering out the deal, the investor worked almost exclusively with David Boden, general counsel for the Rothstein Rosenfeldt Adler law firm. Boden also drafted all the legal documents involved in the deal. The investor also learned during the course of the deal that the sole keeper of all Rothstein's investment scheme records was Debra Villegas, Rothstein's chief operating officer and second in command.

He never met or heard of Rothstein's uncle, Bill Boockvor, who is also suspected to have been deeply involved in the scheme.

Some say there are a lot of similarities between fallen New York lawyer Marc Dreier and Scott Rothstein, but one that I learned is just flat-out weird.

One Beacon Court

​The two attorneys -- both accused of stealing hundreds of millions of dollars -- owned apartments in the same building in New York City at 1 Beacon Court, which is commonly called the "Bloomberg Building."

In July, Dreier's 3,000-square-foot apartment on the 49th floor sold for $8.2 million at a forced auction. The money was split between creditors in his bankruptcy case and victims of his fraud. It came after Dreier was sentenced in July to 20 years in prison for defrauding hedge funds of about $400 million.

It would seem Rothstein's smaller apartment, which he bought in July of last year for $6 million, will soon go through a similar process.

The Dreier case was a big deal in New York, but it can hardly hold a candle to the Rothstein case in terms of drama. Today I received two emails from readers about similarities between the two men, though. One reader sent this list of samenesses between the two fraud artists:

-- the rises from mediocrity to the richest lawyers around.
-- the mediocrity of their staffs.
-- their "unique business models."
-- their obsession with

Once Scott Rothstein explained the concept of buying secret settlement deals (see Part I), he explained just how big these deals could be and how much money could be involved in them.

To illustrate, he told his prospective investor about the giant Eli Lilly pharmaceutical case. The beauty of that was it was real -- the company settled with plaintiffs and the federal government for $1.42 billion -- and a real Rothstein Rosenfeldt Adler attorney, Gary Farmer, was a named lawyer in the case. Efforts to reach Farmer have been unsuccessful.

The Eli Lilly case, which involved several whistleblowers from inside the company, was one of the largest qui tam cases in history. In that case, Eli whistleblowers went to the fed with unlawful practices regarding the marketing and sales of an anti-psychotic medication called Zyprexa. The federal government took the case and distributed the giant settlement among the whistleblowers -- and their attorneys, of course.

The investor said Rothstein called the Eli Lilly case the "best luck of