Dear Judge Cohn,
I do not really possess the words to adequately explain the magnitude of what I have done, why I did it, and the overwhelming remorse and self-loathing I feel about myself and the intense harm and pain I have inflicted upon innocent people who trusted me and loved me only to be deceived by me; my actions can only be described in the most despicable of terms: I committed multiple acts of financial crimes against people that placed their trust in me. All in the name of ego and greed.
I was born June 10, 1962. Three years later my baby sister was born. My mom and dad and sister and I lived in a small apartment in the Bronx in a lower middle class neighborhood, right across the hall from my maternal grandparents. Thorughout my childhood and well beyond, my parents struggled financially. They both held down full time jobs and my sister and I worked as soon as were able. In the early 1970s our neighborhood had taken a turn for the worse and the financial pressure had increased. The only fights I remember my parents having were about money. To protect us and to try to make a better life for us my parents moved us to South Florida in 1976. It was s safer environment, but the financial struggle never subsided until I had been working as an attorney for about 7 years and was financially able to give my parents and my sister money to help ease the financial burden. Despite the financial difficulties in my life during this time and beyond, I was truly blessed. Money was never the end-all for any of us. What my parents and grandparents lacked in financial resources they more than made up for with love, caring, and compassion. My parents and grandparents taught my sister and me the importance of family, respect for others, and the importance of honesty, education, and hard work, and moreover, the mantra of giving back. We were taught that as little as we had, there were always those less fortunate. And we gave of our time and money, even it meant going without.
I translated those lessons in high school, college and law school and, upon graduation from law school, I continued to have what any objective observer would say was a successful life and career. Looking back, however, lurking just below the surface was a person so fearful of failure and so terrified of ever having to struggle the way his parents did, that it translated into an acute anxiety disorder that was, at times, debilitating, and for which I continue to seek treatment today. Moreover,I realize that it translated into an underlying set of character defects and personality flaws that would ultimately never allow me to accept any type of failure on my part. These traits would lay dormant for many years, held in check buy countervailing principles that were the foundation of my family upbringing, until my ego allowed them to manifest themselves in the form of an individual so narcissistic that I would do anything to avoid any type of chink in my armor; anything that would make me look less than uber-successul and perfect in every detail.
I loved being lawyer. I loved trying cases. I loved helping others. And I translated these loves into a job that again, looking back, was the most rewarding of my life; I was offered and accepted a position as an adjunct professor at Nova Law School, teaching trial advocacy in the evenings. I taught for nearly 11 years. It did not matter to me that the pay was almost non-existent (and eventually was non-existent due to budget issues). I was making a real difference in the lives of future attorneys. The joys of teaching were so intense that when I was offered a position on the NITA teaching team, a non-paying position teaching practicing lawyers trial skills, I proudly went all in.
Throughout that time, I did everything in my power to instill in my students a work ethic and set of morals and ideals much like my parents and grandparents did their best to instill in me. That regardless of where you came from, hard work, honesty, integrity, respect for others, and giving back will rule the day, and grant you the give of having a positive impact on your community and the ability to give your family a beautiful life. Above all, I emphasized that zealous representation of your clients and ethical and honest representation of your clients were not mutually exclusive. I did everything in my power to instill a love for the law, respect for your clients and opponents, respect for the court system and the judiciary and a respect for the enormous power you wield as an attorney. So then, what propelled me to act in a manner so contrary to everything I had been taught, to the code I strived to live by, and to everything I tried to impart and instill in others? What ultimately caused the twisted personality that would allow me to wreak so much havoc upon people I love and that trusted me, to surface and to take control?
At the time I began to steal I had no actual fiscal reason to steal other than unbridled envy, pure greed and the absolute inability to deal with even the slightest notion of failure.
I had done well as an attorney. My partner and I had been named shareholders at a 36 lawyer firm in Hollywood, Florida, and we had decided to break off and form our own firm that would operate as a labor and employment law boutique. We opened our offices in Fort Lauderdale rather than remaining in Hollywood and business grew at a better-than-average pace and clients began asking us to perform work for them in many other areas of the law. It was then that we decided that we would grow the firm as much as needed to[sic] in order to service all of our clients’ needs. In hindsight, it was not simply to service our clients that drove me to grow the firm at what would fast become an unsustainable pace, (though it is what I would tell the world — it’s all about helping our clients) but what had become an insatiable desire to have a law firm that would be the envy of all others. The largest, the wealthiest, the most powerful, the finest of everything money and power could provide.
The only was, I had neither the client base, nor the financial resources, nor the requisite skill set to do what I set out to do. As my partner and I grew the firm, it was, at best, feast or famine, most often famine. But I would not accept failure … at any cost. I became the “master” self promoter, lying about everything from the size of the firm to its success. I started traveling in very powerful and very wealthy circles. The money and the power were intoxicating. I began to live a life both personally and professionally that my business could not support. I watched as my friends and colleagues and those I perceived as my business circle prospered. I watched in envy as those I came up with through the ranks, and those I had grown close to through business and friendship, did far better than me. Jealousy and greed took hold. I began to spend like the wealthiest of my friends and colleagues. I began to live like them. My partner and I continued to grow the firm at an alarming pace despite the clear fact that the business would never support the growth. I needed to find some other way to fund the business and the lifestyle I had created out of thin air. Failure was not an option. Word had already spread like wildfire about “RRA,” the firm to watch, the firm to beat, the newest power players. I was determined to do whatever I had to to[sic] make it work; which was simply continuing a charade which was, in hindsight, clearly doomed to fail.
I started by ‘borrowing’ money from people I knew who trusted me. Clients who had become friends and friends that had become clients. But rather than simply being honest with them and telling them I needed a loan (my ego would never allow myself to let someone else think I needed money — that was a sign of failure and of weakness), I concocted elaborate lies about how the money was for bridge loans and the like for important clients and that the clients would pay outrageous interest to keep the loan confidential. And of course, since there really was no client, there could be no form of security from the client. So I concocted another life in a series of lies that in order to maintain strict confidentiality, I would guarantee the loan. And the facade I had masterminded made my word as good as gold.
This was the beginning of the end.
I had completely lost my moral compass. And though I clearly had the ability and opportunity to stop the forward motion of what would be a series of many despicable acts that would ultimately destroy my family, destroy my law firm, cause intense harm to people that loved me and trusted me, I never sincerely attempted to stop. I always had every intention of repaying the money. I had exit strategies to pay everyone off and move forward. And in the early part of this horrific scheme, I could have pulled out of the spin, paid everyone off and lived a beautiful life. All I had to do was reel in my spending which my beyond absurd [sic], reel in my firm’s growth, and most importantly reel in my ego. But that would have required me to admit that the persona I had created for myself and the world, the successful lawyer, entrepreneur and businessmna, were not superhuman. That I was fallible and had, in fact, failed. And my greed and ego were not going to allow that to happen.
I kept orchestrating these fictitious loans to support the firm and it’s [sic] ludicrous growth, and to line my pockets and the pockets of my co-conspirators. As I stole more in the form of these ‘loans for clients’, I paid higher and higher interest rates and concocted more complicated lies … frauds calculated by me to keep the cycle alive. The interest rates were not those requested by my investors, but were, of my own creation. It served to bolster my fictitious business acumen.
Things spiraled out of control. But again, I never sincerely tried to stop. I kept telling that I would be ok. That everyone was making a lot of money, that our ‘investors’ were happy, and that ultimately my exit strategy would
come to fruition and we would pay everyone off.
But that would never happen. I was smack in the middle of a ponzi scheme that I had engineered and it would take a financial windfall of untold magnitude to pull myself out. Somewhere in the midst of all my lies, I created the ‘sale of confidential settlements’ fraud. And that just added to the madness.
And my partner and I continued to grow the firm, and continued to draw down ridiculous sums of money, though we knew the business was not going to support it. I was spending huge sums of money that was not mine. And on top of that, we now had our many other business intersts, purchased solely to line our pockets and maintain the fraud, many of which were just additional sinking ships to fund. And fund them we did … with stolen money. My partners and I invested in businesses we never had any business investing in. All for ego. All to bolster the show. I became involved with other co-conspirators who helped me take the scheme to an entirely new level. Not against my will but rather, with my full cooperation. We went from tens of millions to hundreds of millions almost overnight.
By this time the ponzi scheme had grown so large that I was literally spending almost every waking hour doing something to prevent it from blowing up in my face. It was constantly on the verge of collapse. And yet, I never even tried to stop the bleeding. I kept spending like it was really my money; more expensive cars, boats, homes, offices, jewelry … increasing the firms payroll to ridiculous unsustainable levels … all the trappings of wealth. I gave money to everyone; family, friends, charities. Money that was not mine to give. I convinced myself that I was eventually going to pay it back so I had the right to spend it. I convinced myself that my exit strategy would work. It was my only hope. I kept telling myself that I just needed to hang on for a few more months. And months became years. I had used millions of dollars of the money from my fraud to buy a huge stake in an internet company, qtask, that from all appearances was going to make a killing. At least I convinced myself of that. I was going to cash in with my partners when it sold and pay everyone off, including their false profit. Just another lie that I told myself to justify my spending and my greed. Complete nonsense. I was a criminal. I defrauded people I loved. I gave to charities in enormous amounts thinking I was helping them, when in the end I was just hurting them. I created a power structure unlike any other in Broward County. I did all I could to increase my power, to keep the myth alive, to feed the beast I had created, and to try to keep myself above the law. And ultimately, I did what just several years ago would have been unthinkable to me … I forged signatures of sitting judges on orders that I created to convince these kind people who trusted me, to part with their money. For what … to save myself. I was very near the end.
I would bottom out mentally and spend like there was no tomorrow to generate a temporary euphoria. The ponzi scheme and the money were like a drug to me. But the high only lasted until the next round of payments were due to my ‘investors’ and the vicious cycle repeated. I would crash hard. Ultimately, I repeatedly considered suicide.
I can remember just days before deciding to flee Morocco, stitting in my shower, in my business suit, crying, with a .357 magnum up against my head. I sat for well over an hour. Telling myself repeatedly to just pull the trigger and end the pain. Everyone would be better off. And of course, being the considerate husband, I went into the shower so that my wife would not have to deal with the mess my final selfish act would leave behind.
I kept telling myself that it would be the perfect ending to the perfect life I had decimated. But it turns out that I had one last of selfishness and greed in me. I decided to flee the country. I researched non-extradition countries and settled on Morocco. I quickly made my plans and told my wife that I had to travel out of the country on business. I chartered a jet and off I went. But not before emptying one of the few remaining ponzi trust accounts of 16 million dollars. I had my CFO wire it to Morocco for me.
I packed up as much as I could travel with including several million dollars worth of watches, all while my wife was away so as not to alarm her. I packed the car and waited for her to come home. When she got home that day I kissed her goodbye and left. I was fleeing the country in what could have been the final act of a desperate criminal, too in love with myself to end it all and too greedy and narcissistic to turn himself in. What a waste of a human being I had become.
I spent the first week in Morocco trying to decide what kind of life I would lead there. How would I convince my wife to join me. How would I ever explain this to her. I kept her in thd dark, feeding her the same lies I fed others and more. What about my parents and my children and my sister and my nieces and nephews? What about my uncle who was like my brother and my grandmother who was about to turn 99 and who had given me her life savings to go to law school? I had convinced myself that they were off with me having fled the country rather than having to go through the searing pain of watching my world and theirs unravel in the most horrific fashion. Just another lie I told myself to justify my selfish actions. The pain I was experiencing grew faster and deeper. I could not believe what I had done … all the pain I had caused … all the harm I had inflicted on innocent people. I spent sleepless nights fighting off the intense urge that had returned to kill myself. You see, it was now clear to me that I fled to Morocco not to shield my family, but rather to save myself. And with that though firmly embedded in my brain, I was going to commit suicide. I sent several suicide emails to my family, friends, and business associates. I even tried to send emails to falsely exculpate those had acted with me. I took out the pills necessary to complete the task, drank a bottle of vodka, and sat and stared at the pill bottles. And I cried. For what seemed like days. I begged G-d to help me … to guide me. I pleaded with him. I had been a religious soul (though that certainly did not jive with my horrific actions) but I never prayed and begged like this in my life. I searched the depths of my soul. And then, suddenly, for reasons that to this moment remain a complete mystery to me, it all became crystal clear.
As simply as I had started this life of lies and deceit I would bring it to an end. But not by killing myself. That would just be one final act of selfishness. I would end it by returning home, turning myself in, and starting the process of making right all the hard I had caused.
And for the first time in 5 years I was completely honest about what I had done and who I was. From the moment that I decided to return home, knowing that I would never actually go home again, I have done everything in my power to right the terrible wrongs of my crimes. I had my attorney contact the United States Attorney while I was still in Morocco and tell him that I was turning myself in. The FBI met me at the airport and I spent a full month for hundreds of hours debriefing the government and its agents on my crimes and the crimes of many others. I voluntarily surrendered every single thing I had accumulated in my entire life. I surrendered my license to practice law. And I acted on multiple occasions in an undercover capacity to assist the government.
I continued to debrief the government and its agents as of the writing of this letter and I expect to continue to do so for at least several years. As a result of the level of my cooperation, I am housed in a ‘protective custody unit’, and when and if I am ever released from prison, I will likely never see my family again.
But I do not feel sorry for myself nor do I want anyone’s sympathy. I deserve and expect the punishment I will receive. What I am deeply and sincerely sorry for is the horrific pain and harm I have inflicted on so many people.
These people I lured in as investors who were truly unaware (as opposed to others) — they trusted me. Many of them loved me. And I repaid their trust and love by stealing from them, deceiving them and hurting them.
My colleagues at my firm. My second family. With the collapse of RRA, I hurt so many innocent people. People with families and children who live paycheck-to-paycheck, suddenly, without warning, out of work. And many of them stigmatized because of their relationship to me. They gave me loyalty and I gave them this horror.
The profession I held so dear for so many years. I have degraded and shamed the institution of the practice of law. Because of me, other who have done nothing wrong will be viewed by the public with less respect and suspicion.
The judiciary. Those people who committed their lives to the rule of law. I slandered their good and decent names for no reason other than to further my crimes.
My friends. Those that stood by me as I rose to prominence. That defended me when others said I must be a criminal. I have subjected them to tremendous embarrassment and ridicule. Many of them truly loved me and I repaid them by betraying their trust, deceiving them, and hurting them deeply.
And my precious family. I have literally destroyed their lives. My wife is devastated financially and emotionally. She has been abandoned by all but a very small handful of her friends because of me. I have cause [sic] her immeasurable pain, shame and sorry. And now I have lost her forever. My parents, my grandparents, my sister and her children, my beautiful children, my cousins and aunts and uncles. My daughter refuses to speak with me and I do not blame her. I have wreaked havoc upon my family of such an intense nature and magnitude that it is difficult for me to fathom I have undermined everything my family stands for. All that I was taught as a child and raised to believe in with every fiber of my being … respect, integrity, honor, hard work and the sanctity of family. I discarded and trampled them all. And I am certain that I have left deep and indelible emotional scars. Others in the community such as the charities and worthy causes I tried to help who are forced to return money. I wound up injuring them, not helping them.
For all of this I am filled with remorse and sincerely and deeply sorry. While I am incarcerated and when and if I am released I will never stop working as long as I am alive to heal the wounds I have opened on those I stole from, and on my colleagues, my friends, and my family.
I understand that this Court must, and I expect it to, sentence me to a significant term of years. I only that you deal with me fairly and that based upon the fact that the record now exists, from my decision to return from Morocco and all that I have done since, that I am truly a changed man and that I have sincerely tried to redeem myself, that you consider giving me an opportunity to live at least part of the remainder of my life as a free man with an opportunity to do some good in this world. I will never forgive myself for what I have done nor do I expect anyone else to forgive me. But I will spend the rest of my life doing everything in my power to make right all the harm I have caused and to restore my family’s good name as G-d will allow.
s/Scott W. Rothstein
June 2, 2010