2011-12-21 Rothstein Scott AM

(954) 525- 2221United Reporting, Inc.

IN THE CIRCUIT COURT OF THE 17TH JUDICIAL CIRCUIT IN AND FOR BROWARD COUNTY, FLORIDA

Case No. 09-062943 (07)

_____________________________________________________

RAZORBACK FUNDING, LLC, et al.,

Plaintiffs,

vs.

SCOTT W. ROTHSTEIN, et al.,

Defendants.

____________________________________________________

DAY 7 - MORNING SESSION

DEPOSITION OF SCOTT W. ROTHSTEIN

DATE TAKEN: December 21, 2011 TIME: 8:36 a.m. - 12:07 p.m. PLACE: James Lawrence King Federal Justice Building 99 N.E. Fourth Street Courtroom 11-3 Miami, Florida 33128

Examination of the witness taken before: Michele L. Savoy, Registered Professional Reporter United Reporting, Inc. 1218 S.E. Third Avenue Fort Lauderdale, Florida 33316 (954) 525-2221


Page 2028

1 IN THE CIRCUIT COURT OF THE 17TH JUDICIAL CIRCUIT IN AND FOR

2 BROWARD COUNTY, FLORIDA

3 ____________________________________________________ Case No. 10-24110 CACE(19)

4EDWARD J. MORSE and CAROL A. MORSE,

5 and MORSE OPERATIONS, INC.

6 Plaintiffs,

7 vs.

8 SCOTT W. ROTHSTEIN, et al.,

9 Defendants._____________________________________________________

10 Case No. 11-CV-61688-JIC/LSS

11 AMY ADAMS, et. al,

12 Plaintiffs,vs.

13SCOTT W. ROTHSTEIN, TD BANK, N.A. and GIBRALTAR

14 PRIVATE BANK AND TRUST COMPANY,

15 Defendants.

16 _____________________________________________________

17 10-03767-RBR Stettin v. Gibraltar Private Bank & Trust Co.

1810-03802-RBR Stettin v. Centurion Structured

19 Growth, LLC, et al

20 11-02368-RBR Stettin v. TD Bank, N.A.

21 11-02288-RBR Stettin v. Fidelity Charitable Gift Fund

22 11-02473-RBR Stettin v. Regent Capital Partners, LLC, et al

2311-02604-RBR Stettin v. Maple Leaf Drilling

24 Partners, et al

25 11-02605-RBR Stettin v. Don King Productions, Inc.


Page 2029

1 (Counsel appearing on the foregoing appearance pages reflect counsel that attended at least one session

2 during the deposition. It does not reflect their appearance each and every session.)

3

4 APPEARANCES FOR SCOTT ROTHSTEIN:

5 LAW OFFICE OF MARC S. NURIK 1 East Broward Boulevard

6 Suite 700 Fort Lauderdale, Florida 33301

7 BY: MARC S. NURIK, ESQUIRE

8APPEARANCES FOR THE CHAPTER 11 TRUSTEE,

9 HERBERT STETTIN:

10 BERGER SINGERMAN 350 East Las Olas Boulevard

11 Suite 1000 Fort Lauderdale, Florida 33301

12 BY: CHARLES H. LICHTMAN, ESQUIRE and

13 GENOVESE, JOBLOVE & BATTISTA, P.A. 100 S.E. 2nd Street

14 Suite 4400 Miami, Florida 33131

15 By: JOHN. H. GENOVESE, ESQUIRE DAVID C. CIMO, ESQUIRE

16 THERESA M.B. VAN VLIET, ESQUIRE JESUS SUAREZ, ESQUIRE

17

18 APPEARANCES FOR RAZORBACK:

19 CONRAD & SCHERER, LLP 633 South Federal Highway

20 Eighth Floor Fort Lauderdale, Florida 33302

21 By: WILLIAM R. SCHERER, ESQUIRE ERIC RAYMAN, ESQUIRE

22 IVAN J. KOPAS, ESQUIRE and

23 KOZYAK, TROPIN & THROCKMORTON, P.A. 2525 Ponce de Leon Boulevard

24 Ninth Floor Coral Gables, Florida 33134

25 By: HARLEY S. TROPIN, ESQUIRE


Page 2030

1APPEARANCES FOR PLATINUM PARTNERS VALUE ARBITRAGE

2 CENTURION STRUCTURED GROWTH, LLC:

3 GOLDSTEIN, TANEN & TRENCH, P.A. One Biscayne Tower, Suite 3700

4 Two South Biscayne Boulevard Miami, Florida 33131

5 By: SUSAN E. TRENCH, ESQUIRE

6APPEARANCES FOR LEVINSON'S JEWELERS:

7 KOPELOWITZ OSTROW FERGUSON WEISELBERG KEECHL

8 200 SW 1st Ave Suite 1200

9 Fort Lauderdale, Florida 333012073 BY: JAN ATLAS, ESQUIRE

10

11 APPEARANCES FOR THE COMMITTEE OF UNSECURED CREDITORS:

12 AKERMAN, SENTERFITT

13 One Southeast Third Avenue 25th Floor

14 Miami, Florida 33131-1704 By: MICHAEL GOLDBERG, ESQUIRE

15

16 APPEARANCES FOR TD BANK:

17 GREENBERG TRAURIG, P.A. 401 E Las Olas Blvd Ste 2000

18 Fort Lauderdale, Florida 33301 By: HOLLY SKOLNICK, ESQUIRE

19 DONNA EVANS, ESQUIRE MARK SCHNAPP, ESQUIRE

20

21 APPEARANCES FOR RLI ZURICH INSURANCE COMPANY, COLUMBIA INC. & ZURICH INSURANCE:

22 CLAUSIN MILLER

23 One Chase Manhattan Plaza 39th Floor

24 New York, New York 10005 BY: SCOTT L. SCHMOOKLER, ESQUIRE

25


Page 2031

1 APPEARANCES FOR FEDERAL INSURANCE COMPANY:

2 ALEX HOFRICHTER, P.A 1430 South Dixie Highway

3 Suite 204 Coral Gables, Florida 331463127

4 By: ALEX HOFRICHTER, ESQUIRE

5APPEARANCES FOR MORSE:

6 TRIPP SCOTT, P.A.

7 110 S.E. Sixth Street,15th Floor Fort Lauderdale, Florida 33301

8 By: GEORGE WALKER, ESQUIRE JOHN M. MULLIN, ESQUIRE

9

10 APPEARANCES FOR CAROL MORSE, TED MORSE & MORSE OPERATIONS:

11 LAW OFFICES OF ROBERTA DEUTSCH

12 2499 Glades Road Suite 110

13 Boca Raton, Florida 33431 By: ROBERTA M. DEUTSCH, ESQUIRE

14

15 APPEARANCES FOR EMESS CAPITAL, LLC:

16 KLUGER KAPLAN SILVERMAN, KATZEN & LEVINE, PL 201 S Biscayne Blvd Fl 17

17 Miami, Florida 33131 BY: CASEY H. CUSICK, ESQUIRE

18

19 APPEARANCES FOR ST. PAUL FIRE & MARINE:

20 MILLS PASKERT DIVERS P.A. 100 N Tampa St Ste 2010

21 Tampa, Florida 33602 BY: JOHN A. BLACK, JR., ESQUIRE

22APPEARANCES FOR ROSANNE CARETSKY:

23 Billing Cochran Lyles

24 515 E Las Olas Blvd Floor Six

25 Fort Lauderdale, Florida 333012296 By: WILLIAM TUCKER CRAIG, ESQUIRE By: WILLIAM TUCKER CRAIG, ESQUIRE


Page 2032

1

2 APPEARANCES FOR PLATINUM & CENTURION: HARVEY WERBLOWSKY, ESQUIRE

3 and CURTIS, MALLET-PREVOST, COLT & MOSLE, LLP

4 101 Park Avenue New York, NY 10178-0061

5 By: GABRIEL HERTZBERG, ESQUIRE ELIOT LAUER, ESQUIRE

6

7 APPEARANCES FOR FEPICT, MS GROUP:

8 NYSTROM, BECKMAN & PARIS One Marina Park Dr., 15th Flr.

9 Boston, MA 02210 By: JACK SEIGAL, ESQUIRE

10

11 APPEARANCES FOR MICHAEL SZAFRANKSI:

12 LYDECKER, DIAZ 1221 Brickell Avenue

13 Floor 19 Miami, Florida 33131

14 BY: CHRISTOPHER G. BERGA, ESQUIRE MIGUEL J. CHAMORRO, ESQUIRE

15

16 APPEARANCES FOR GIBRALTAR:

17 STEARNS WEAVER MILLER, et al. 150 W Flagler St Ste 2200

18 Miami, Florida 331301545 BY: MARY BARZEE-FLORES, ESQ.

19 MATTHEW DATES, ESQUIRE

20APPEARANCES FOR FRANK PREVE:

21 PODHURST ORSEK

22 25 W Flagler St Ste 800 Miami, Florida 331301720

23 BY: RAMON A. RASCO, ESQUIRE

24APPEARANCES FOR LEVINSON PEARSON & ASSOCIATES,

25 WATCH U-WANT, INC.:


Page 2033

1 KOPELOWITZ OSTROW 200 SW 1st Ave Ste 1200

2 Fort Lauderdale, Florida 33301 By: BART A. HOUSTON, ESQUIRE

3

4 APPEARANCES FOR THE US GOVERNMENT:

5 U.S. DEPARTMENT OF JUSTICE UNITED STATES ATTORNEY'S OFFICE

6 500 E. Broward Blvd., Ste. 700 Ft. Lauderdale, Florida 33394

7 BY: CYNTHIA STONE, ESQUIRE

8APPEARANCES FOR FRANK SPINOSA:

9 SCHLESINGER AND COTZEN, P.L.

10 799 Brickell Plz Ste 700 Miami, Florida 33131

11 BY: MICHAEL J. SCHLESINGER, ESQUIRE and MICHAEL COTZEN, ESQUIRE

12 and SAMUEL J. RABIN, ESQUIRE

13 799 Brickell Plaza Suite 606

14 Miami, Florida 33131

15

16

17

18

19

20

21

22

23

24

25


Page 2034

1 INDEX

2 CONTINUED DEPOSITION OF SCOTT W. ROTHSTEIN

3 DIRECT FURTHER DIRECT

4 Ms. Evans 2035Mr. Schnapp 2127

5 Mr. Rabin 2146

6 Mr. Craig 2186

7 CERTIFICATE OF OATH 2199CETIFICATE OF REPORTER 2200

8

9 TD BANK'S EXHIBIT INDEX

10 NO. DESCRIPTION PAGE NO240 Trustee_TD-000270 2035

11 241 Trustee_TD-000014 2056242 Coquina 000875 2074

12 243 September 9, 2009, Email 2076244 Email Chain 2110

13 245 Email Chain 2121246 Email Chain 2136

14 247 Coquina 003147 2138248 Trustee_TD-000279 2138

15 249 Email Chain 2140250 FP112310-0175287/1 2142

16

17 SPINOSA'S EXHIBIT INDEXNO. DESCRIPTION PAGE NO

18 251 Text Messages 2154252 September 9, 2009, Email 2155

19 253 April 23, 2009, Email 2157254 Email Chain 2160

20 255 TD/Razor 002505 2164256 Email Chain 2167

21 257 Invitee List 2178258 April 22, 2009, Email 2187

22

23

24

25


Page 2035

1 Whereupon,

2 SCOTT W. ROTHSTEIN,

3 acknowledged having been duly sworn to tell the truth

4 and testified upon his oath as follows:

5 THE WITNESS: I do.

6 CONTINUING DIRECT EXAMINATION

7 BY MS. EVANS:

8 Q Good morning, Mr. Rothstein. How are you?

9 A Good morning, Ms. Evans. Thank you. I'm

10 well.

11 Q Thank you for giving us testimony again today.

12 I appreciate it.

13 There are a couple of things this morning I

14 just wanted to start off with to sort of like clean up

15 and circle back on some matters from yesterday.

16 A Okay.

17 Q And take it from there.

18 The first exhibit that I'm going to ask you to

19 take a look at is going to be No. 240, and it is

20 Trustee TD 270 and 271.

21 (Thereupon, the document was marked as TD

22 Bank's Exhibit 240 for Identification.)

23 BY MS. EVANS:

24 Q And I think if you -- to review it, you would

25 start with the back page and work to the front.


Page 2036

1 A Okay. I've reviewed it.

2 Q The last page has a reference that -- the top

3 email on that page, "I just landed. Did I get the Utica

4 deal? Wish you were here. Love ya, Mikey."

5 Does that refresh your recollection as to who

6 Utica was, by any chance?

7 A It refreshes my recollection to the extent

8 that it's clear that Utica was under the Szafranski

9 feeder fund umbrella.

10 Q Okay. Other than that, do you remember

11 anything about Utica itself?

12 A I do not.

13 Q Okay. Do you remember anything about the

14 circumstances of this particular -- this particular set

15 of emails?

16 A Only that Mike was in Israel.

17 Q Okay. Looking at the first page under

18 August 3rd, I guess it states August 3rd, at 12:36 --

19 well, it doesn't matter.

20 Actually, here's my question: On August 3rd,

21 was Mr. Szafranski at that point, to your knowledge,

22 aware of the -- that he was involved in a Ponzi scheme?

23 MR. SCHERER: Objection. Form.

24 A We never used the word "Ponzi scheme." He was

25 aware that a fraud was occurring, yes.


Page 2037

1 BY MS. EVANS:

2 Q And was he aware that the fraud was a scheme?

3 MR. SCHERER: Object. Form.

4 A I can't tell you -- I don't even know what

5 that means. A "scheme." It's such a broad word.

6 BY MS. EVANS:

7 Q Was he --

8 A He was aware that we were lying to investors.

9 He was aware that the money we were saying was there,

10 was not there.

11 He was aware of fraud and he was

12 participating.

13 Q Do you know if Mr. Szafranski was aware at

14 this point in time that the structured settlements were

15 fraudulent?

16 MR. SCHERER: Objection to form.

17 A They were --

18 MS. EVANS: What about the form is

19 bothering you?

20 MR. SCHERER: The form is that it's so

21 repetitive. This witness has answered about

22 Szafranski being aware and when he was aware

23 maybe 20 times in the last seven days.

24 And, you know, you've got six lawyers

25 from TD and --


Page 2038

1 MR. SCHLESINGER: Mr. Scherer --

2 MR. SCHERER: Just let me finish.

3 MR. SCHLESINGER: You're making a speech.

4 MR. SCHERER: Don't interrupt me.

5 She asked me and I'm telling her what the

6 form is.

7 Don't interrupt me, Mike.

8 MS. EVANS: Let's do this. Let's try to

9 be very civil.

10 MR. SCHERER: Whoa, whoa, whoa. Let me

11 finish.

12 MS. EVANS: Let's try to be very civil

13 here.

14 MR. SCHERER: So you guys have got about

15 six lawyers and you continue to ask the same

16 questions over and over and over again.

17 If you read the order, that's not the

18 spirit of the order, and that's what's going

19 on here. And, frankly, I'm going to object to

20 form every time. And when we get there, I'm

21 going to ask the Court to strike it because it

22 had been asked and answered dozens of times.

23 So, now.

24 BY MS. EVANS:

25 Q This is an exhibit which has not been before


Page 2039

1 you in the past seven days; is that correct?

2 A I have seen so many exhibits, Ms. Evans --

3 Q Okay. I'll rephrase the --

4 A -- I can't tell you whether it's been before

5 me or not.

6 Q I'll represent to you that this has not been a

7 part of any exhibits that we've had here in the past

8 seven days, which is why I'm asking you to testify as to

9 this exhibit right now. And with this exhibit in front

10 of you, are you aware from anything that is on this

11 page, whether or not Mr. Szafranski was aware of the

12 fact that the settlements were fraudulent at this point

13 in time?

14 MR. SCHERER: Object to form.

15 A This doesn't speak to it one way or the other.

16 BY MS. EVANS:

17 Q Okay.

18 A In my mind.

19 I know what he was aware of.

20 I don't know what you're trying to get at in

21 this particular email. This is about a specific deal.

22 Do you have another email?

23 Q I'm not trying to get at anything. I'm just

24 trying to see if I can refresh your recollection on any

25 further details. So that's why I'm showing you this


Page 2040

1 email.

2 A It's not refreshing anything other than Utica

3 was under the Szafranski umbrella.

4 Q To your knowledge, did you ever meet anyone

5 from Utica?

6 A I may have.

7 Q And when you say "I may have," do you have any

8 recollection whatever?

9 A I have a recollection of probably meeting over

10 1,000 people during the course of the Ponzi scheme. So

11 I may have.

12 Q None of whom you can directly say were

13 associated with Utica?

14 If I represented to you that Utica has

15 assigned its interest in a proof of claim to Emess,

16 would that in any way -- are you aware of that?

17 MR. CUSICK: Object to the form.

18 A I'm not.

19 BY MS. EVANS:

20 Q Would that jog your memory in any way as to

21 whether Emess and Utica were related?


23 A It does not.

24 Perhaps if you have something between Utica

25 and Mr. Lifshitz, that might establish one way or the


Page 2041

1 other whether they were related. But as I sit here

2 today, I don't have a specific memory as to who Utica

3 was, except now that it was under the Szafranski

4 umbrella.

5 BY MS. EVANS:

6 Q What do you mean when you say "Szafranski

7 umbrella"?

8 A Szafranski was a Ponzi scheme feeder fund.

9 The way I group things in my mind was there was the

10 Banyan/Levin umbrella. That was the Szafranski

11 umbrella. There was the hedge funds in New York. And

12 eventually there was the A.J./Von Allmen umbrella.

13 But different people traveled back and forth

14 under different umbrellas as the Ponzi scheme got more

15 complicated.

16 Q And the Pearson umbrella, was that one as

17 well?

18 A Yes, I'm sorry, the Boden/Pearson umbrella.

19 Q Going back to Mel Lifshitz for a moment, do

20 you know how many times you met with him?

21 A I do not.

22 Q Do you know whether it was more than a dozen?

23 A I would be guessing.

24 Q Do you recall meeting with him in your office?

25 A I do.


Page 2042

1 Q How many times?


3 Q Do you recall any circumstances upon which he

4 came to your office?

5 A Personal stuff and business stuff.

6 Q What personal stuff did he come to your office

7 for?

8 A To see me.

9 Q On -- for any particular purpose besides just

10 personal? In other words, what personal --

11 A My recollection is, that every time I met with

12 Melly Lifshitz, we had personal time together, meaning

13 we might go to lunch or dinner or have a cocktail or

14 just sit around and BS, and we would have business time.

15 Q How many times did he come to your office on

16 business?

17 A I just said I don't remember.

18 Q Okay. Did you do any business with

19 Mr. Lifshitz besides the structured settlements?

20 A I don't recall.

21 Q Is there any document that might -- do you

22 recall that you're aware of?

23 A If you have a document and you show it to me,

24 that would be helpful.

25 Q Do you recall yourself creating any documents


Page 2043

1 related to Mr. Lifshitz other than the deal documents?

2 A I, unfortunately, don't recall just because of

3 the sheer magnitude of paper in this case. With over a

4 million pages, I just can't have a specific recollection

5 at this moment regarding whether I did something outside

6 the Ponzi scheme with Mr. Lifshitz. I don't have an

7 independent recollection.

8 Q Is your recollection limited to the documents

9 in this case in terms of the documents you can recall?


11 MR. SCHERER: Object to the form.

12 A I don't know what that question means.

13 BY MS. EVANS:

14 Q Well, you said you can't recall anything

15 that's from the documents in this case and I guess I --

16 A That's not -- whoa, whoa. I never said I

17 can't recall anything from the documents in this case.

18 Q You're right. You didn't say --

19 A That's not what I said.

20 Q All right. Why don't you -- my question to

21 you is, you said you don't recall anything from the

22 documents in this case and I'm asking beyond that do you

23 recall --

24 A I never said that.

25 Q Let me finish and then you can answer.


Page 2044

1 Whether you created any document related to

2 Mr. Lifshitz outside of those documents?

3 ALL PRESENT: Object to the form.

4 A I did, to my knowledge, to the best of my

5 recollection, substantial fraudulent business with

6 Mr. Lifshitz.

7 To my knowledge, which he did not know was

8 fraudulent. I was defrauding him and his investors.

9 I don't recall whether or not I did any

10 regular other business with him. I may have. If you

11 have a document that reflects that, the easiest thing to

12 do is simply show me the document, then I can answer

13 your question.

14 MS. EVANS: I move to strike that answer

15 as nonresponsive to my question.

16 BY MS. EVANS:

17 Q Do you have any knowledge whether anyone at TD

18 Bank met anyone related to Emess at any point in time

19 during the scheme?

20 A They may have.

21 Q What is your best recollection regarding that?

22 A That they may have.

23 Q So you don't have any specific recollection

24 whatsoever?

25 A They may have.


Page 2045

1 Q Listen to my question and please answer my

2 question. Do you have any specific recollection

3 whatsoever?

4 ALL PRESENT: Object to form.

5 A My specific recollection is that they may have

6 met someone from Emess. You must understand -- let me

7 finish. You must understand that Mr. Spinosa came on

8 many occasions to Bova to have a drink with me. It was

9 my, quote/unquote, watering hole, my meeting place,

10 since I owned it.

11 I can't specifically remember whether or not I

12 may have introduced, for example, Mr. Spinosa, to

13 someone from Emess, to Mr. Lifshitz. I just can't

14 remember. There were too many meetings, too many

15 people, okay. Certain things I remember specifically.

16 I don't know one way or the other at this moment. It's

17 very possible that he did.

18 BY MS. EVANS:

19 Q So the answer to the question is you don't

20 recall?


22 A He very well may have met someone from TD

23 Bank.

24 And now that I'm thinking about it,

25 Mr. Lifshitz was pushy when it came to getting


Page 2046

1 information. And I would say that more likely than not,

2 he did meet someone or speak to someone, Mr. Spinosa

3 probably, from TD Bank. But I don't have a specific

4 recollection of that meeting.

5 BY MS. EVANS:

6 Q Therefore, you don't recall any specific

7 meeting between Mr. Lifshitz and anyone at TD Bank?


9 A I'm going to stick with the answer I already

10 gave. The multiple answers I gave.

11 MS. EVANS: Move to strike the answer he

12 already gave as nonresponsive.

13 BY MS. EVANS:

14 Q Do you have any knowledge whether anyone at TD

15 Bank discussed the structured settlements with anyone at

16 Emess to the extent that they told that person at Emess

17 the purported defendant would be required to deposit the

18 full amount of the settlement into an account at TD

19 Bank?

20 A I'm sorry. I lost you right after you said

21 "structured settlement," because as I've explained

22 multiple times, these were not sold as structured

23 settlements. Ever.

24 Q I'm quoting the Emess complaint filed against

25 TD Bank in this case.


Page 2047

1 So would you say that's an inaccurate

2 statement?

3 A You've have to show me the complaint.

4 Q Well, I'm going to read it to you. Which, it

5 says --

6 A Ms. Evans, I don't mean to interrupt you, but

7 I don't understand why people don't want to show me

8 documents. If we're trying to get to the truth, the

9 easiest thing to do is simply show me the document.

10 I'll tell you whether it's right or wrong.

11 I'm not here to hide anything. I'll tell you.

12 Q And I'm going to read you a statement and you

13 can tell me if you don't understand it or if you can

14 answer the question.

15 The Emess complaint states as following that

16 someone at TD Bank told someone at Emess, "The

17 structured settlements and the" -- discussing the

18 structured settlement, "The purported defendant would be

19 required to deposit the full amount of the settlement

20 into an account at TD Bank.

21 Do you have any knowledge whether anyone at TD

22 Bank told anyone at Emess that particular statement?

23 ALL PRESENT: Objection to form.

24 A You're reading the statement to me too

25 quickly. You need to either read it to me again, a


Page 2048

1 little slower, please.

2 BY MS. EVANS:

3 Q Okay. Be happy to.

4 "The purported defendant would be required to

5 deposit the full amount of the settlement into an

6 account at TD Bank."

7 Do you know whether anyone at TD Bank made

8 that statement to anyone from Emess?

9 MR. CUSICK: Form.

10 BY MS. EVANS:

11 Q Do you have personal knowledge of that?

12 A I don't have personal knowledge as to whether

13 that occurred.

14 Q Okay. Do you know -- do you have personal

15 knowledge of whether anyone at TD Bank told anyone at

16 Emess the purported plaintiff would agree to receive the

17 settlement payout over a period of time, usually four to

18 six months?

19 A Whether someone at TD Bank told someone from

20 Emess that?

21 Q Do you have personal knowledge whether someone

22 at TD Bank told someone at Emess that?

23 A I have no knowledge one way or the other.

24 It's possible that it happened but I have no specific

25 knowledge of that.


Page 2049

1 Q Did anyone at TD Bank personally assist you

2 with hiring and paying gratuities to local police

3 departments for security for yourself?

4 ALL PRESENT: Form.

5 MS. STONE: Objection. Privileged.

6 BY MS. EVANS:

7 Q Did anyone at TD Bank personally help you make

8 political contributions to local, state, and federal

9 political candidates?

10 MS. STONE: Objection.

11 BY MS. EVANS:

12 Q Did anyone at TD Bank personally help you

13 purchase expensive real estate, business interests,

14 boats, and exotic cars for yourself?

15 A I remember having a conversation with

16 Mr. Spinosa about real estate values. But to my way of

17 thinking, I don't think that's helping me purchase

18 something.

19 Q Okay.

20 A So the answer to the question would be to the

21 best of my recollection, no.

22 Q To your knowledge, was it Mr. Szafranski who

23 pitched the deals that you were selling to Mr. Lifshitz?

24 A Both of us did.

25 Q When did you pitch to him?


Page 2050

1 A I don't remember the exact date but it would

2 be a month to two months prior to the first time he

3 invested. So you can pinpoint the date to within 60

4 days by looking at the first date of his first deal.

5 Q Do you know where this took place?

6 A I do not.

7 Q Do you recall --

8 A Wait a second. I do have a recollection of

9 being in his office in New York someplace. I don't know

10 whether it was Manhattan or one of the boroughs, but I

11 do have a recollection of visiting Mr. Lifshitz's office

12 and also meeting people that were his partners. Whether

13 they were partners in this business, I don't know, but I

14 do recall going there and meeting with him and being

15 introduced to some of his people. And at that

16 conversation I did, in fact, speak to Mr. Lifshitz about

17 the settlement business.

18 Q Do you recall what you said to him about the

19 settlement business in that meeting?

20 A I don't recall the specific conversation.

21 Q Do you remember who you met, the names of

22 anyone that you met?

23 A I do not. Other than Mr. Lifshitz.

24 Q How many people did you meet?

25 A As I'm sitting here, I'm picturing


Page 2051

1 Mr. Lifshitz sitting behind a desk, me sitting in one of

2 the guest chairs, one of his partners sitting to the

3 right of me, and someone standing elsewhere in the

4 office. So Mr. Lifshitz and two.

5 Q Did you have --

6 A And perhaps other people came in and out.

7 Q Did you have anyone else that you brought

8 along to that meeting?

9 A There was someone else with me but I don't

10 recall whether it was -- I don't believe it was anyone

11 from the hedge funds. So I would be guessing. But if

12 anyone was with me, and I believe someone was always at

13 these meetings with me, it was Mr. Szafranski.

14 Q Do you remember how long the meeting lasted?

15 A It was actually longer than most. We sat for

16 quite a bit of time.

17 Q How long do most meetings last -- most of

18 these meetings last?

19 A You're talking about hundreds of meetings. I

20 do recall sitting with him for an extended period of

21 time. I might meet for an hour with someone. I might

22 meet for ten minutes with someone. But I do recall

23 sitting with Mr. Lifshitz for what I would guess to be

24 over an hour, but it's a guess, discussing both business

25 and personal matters.


Page 2052

1 Q Was that the first time you had met

2 Mr. Lifshitz to your knowledge?

3 A I don't recall.

4 Q Do you recall how soon after that meeting he

5 made an investment, or Emess Capital made an investment

6 rather?

7 A I don't recall.

8 Q Do you know how many deals Emess Capital

9 purchased?

10 A The records would reflect the exact number.

11 No reason to have me guess when the exact number is

12 written in stone in paper.

13 Q So your answer is you don't recall personally?

14 A My answer is the answer I just gave.

15 Q Do you recall personally? That's what I'm

16 asking you.

17 A What I recall is that there's paper on every

18 deal I did with him, so I have a record. And there's a

19 record of it.

20 Q Now, I think you've testified that one of the

21 things that you needed to keep your scheme going was the

22 trust of your investors. Is that an accurate statement?

23 A I needed to get them to trust me, yes.

24 Q And they had to trust the legitimacy of the

25 scheme --


Page 2053

1 A They did.

2 Q -- in your opinion?

3 Do you recall a time where Mr. Lifshitz asked

4 you if he could speak directly with Mr. Spinosa?

5 A I do.

6 Q And do you recall your reaction to that?

7 A I don't.

8 Q Do you recall ever writing Mr. Lifshitz and

9 telling him it would be illegal for you to have him

10 speak with Mr. Spinosa about the account?

11 A I certainly may have. It sounds like

12 something I would have done. So if you have something

13 in writing that you can show me, that would refresh my

14 recollection.

15 Q Were there times that you attempted to not

16 have investors speak with Mr. Spinosa?

17 A Absolutely. Yes.

18 Q Why was that?

19 A One of the things I learned during the course

20 of this massive crime was that, one, keep your

21 co-conspirators in the dark as to who other

22 co-conspirators are in order to not have them talking to

23 each other about the crime -- would lead to detection.

24 Two, even with your most trusted

25 co-conspirators, do not allow them to talk unnecessarily


Page 2054

1 to an innocent victim. The more they talk, the more

2 that's said, the greater the chance of detection.

3 Q At the same time, you wanted lots of money in

4 your scheme, correct?

5 A I don't know what you mean, "at the same

6 time."

7 Q One of your primary goals, if not your primary

8 goal, was to have investors put a lot of money into your

9 scheme?

10 A Correct.

11 Q And if having an investor talk to Mr. Spinosa

12 would accomplish that, and if, as you've testified,

13 Mr. Spinosa would do anything you asked him, why not

14 have Mr. Spinosa speak to your investors?

15 A To the best of my recollection, I never said

16 Mr. Spinosa would do anything that I asked him.

17 Mr. Spinosa served a limited, useful purpose

18 in the course of the conspiracy as a co-conspirator. I

19 always tried, and the record will reflect that I always

20 tried, to limit each co-conspirator's activity within

21 the crime to exactly what I needed. No more, no less.

22 Q Was it your perception that there were

23 limitations to what Mr. Spinosa would do for you?

24 MS. EVANS: Let the record reflect that

25 Mr. Nurik is writing a note to his client.


Page 2055

1 A If he --

2 MR. NURIK: No. Let the record reflect

3 that Mr. Nurik is writing a note to Mr. Nurik.

4

5 MS. EVANS: I'm sorry, what?

6 MR. NURIK: Let the record reflect that

7 Mr. Nurik is writing a note to Mr. Nurik.

8 MS. EVANS: Okay.

9 MR. NURIK: If you want to see the note,

10 it relates to a personal matter.

11 MS. EVANS: No. Your client was looking

12 over his shoulder --

13 MR. NURIK: He may have been looking over

14 his shoulder but maybe he likes what I'm

15 wearing today. But I'm writing a note to

16 myself.

17 MS. EVANS: Thank you. You can let the

18 record reflect that as well.

19 UNKNOWN SPEAKER: It's a nice tie.

20 MR. NURIK: Thank you.

21 THE WITNESS: I think so, too.

22 Your question was?

23 MS. EVANS: Can you read back the

24 question, please.

25 (Thereupon, the reporter read back the


Page 2056

1 question as recorded above.)

2 A I don't know. He did what I asked of him.

3 That's all that concerned me.

4 MS. EVANS: And I'm marking as

5 Exhibit 241, a series of emails. It's a

6 composite exhibit.



9 BY MS. EVANS:

10 Q Trustee TD 14, 20, 21, 22, and 273.

11 Before you look at this document, just one

12 follow-up question. Did Mr. Spinosa ever give you

13 direction as to how you should conduct your Ponzi

14 scheme?

15 A Say that again.

16 Q Did Mr. Spinosa ever give you direction as to

17 how you conducted your Ponzi scheme?

18 A No.

19 Q After you've had a chance to look at this,

20 just let me know.

21 A You want me to read all the papers?

22 Q We're going to walk through each one of them,

23 so do you want to just take the first one, talk about

24 it --

25 A If they're in order, let me just go ahead and


Page 2057

1 take a moment to read it so that I can answer your

2 questions.

3 Q That's fine.

4 A Okay. I've read all the emails that you gave

5 me.

6 Q Looking at the very first one here, which is

7 dated June 26, from Michael Szafranski to you, did you

8 receive this; do you recall?

9 A I do.

10 Q And what do you recall -- let's read it into

11 the record first. "I need you to call Damson today,

12 please. He is insulted you have not called him back.

13 Please do it for your little bro. His threatening to

14 totally pull out," and the phone number.

15 Do you recall what the circumstances of this

16 email were?

17 A No.

18 Q When you say you recall receiving the email,

19 what do you recall about receiving the email?

20 A Receiving the email.

21 Q And why do you recall receiving the email?

22 A Because Damson was always threatening to pull

23 out. That was his big push to get things done the way

24 he wanted to.

25 Q So it's fair to say his mode of operation was


Page 2058

1 to threaten to pull out of deals?

2 A When he wasn't getting what he wanted, yes.

3 Q What was he not getting what -- as to what he

4 wanted here?

5 A The things that he lists in these documents.

6 Q Okay.

7 A He's asking Mike for various stuff. Do you

8 want to read the entire email into the record. That

9 will tell you what he's not getting and what he's upset

10 about.

11 Q What things in particular do you see there

12 that he doesn't want, that you recall?

13 A I would have -- let's see. He writes here,

14 "In yesterday's discussion, we did not bring up the two

15 issues that we have been working on for sometime and

16 they are again problems of credibility for you and me."

17 Q Do you know?

18 A He's not getting something that he wants.

19 Q Do you know what those two issues are?

20 A I don't. Let's see.

21 Q Okay. Why don't we do this differently --

22 A "You indicated last week that" --

23 Q -- because I think just reading this into the

24 record doesn't help us very much.

25 A But it actually tells you exactly what it was


Page 2059

1 he was looking for.

2 Q It sounds like you don't recall from reading

3 the first email alone what he's looking for there or

4 what he's insulted about; is that correct? Or unhappy

5 about, I guess is the best way to put it?

6 A You want me to now separate out the knowledge

7 I have from reading the other emails and tell you just

8 what I remember from looking at the first email?

9 Q Here's what I would like you to do. Look at

10 the first page. Do you have any independent

11 recollection looking at this email what you should have

12 called him back about or what he wanted you to call him

13 back about?


15 A No, but whenever I did call -- I don't

16 remember. No, I don't.

17 BY MS. EVANS:

18 Q Look at the next one, June 30th, states, "They

19 are 99 percent sure on the 2.8. He says that he is

20 making receipt of that piece of paper you promised him a

21 condition for future fundings. Barry feels unloved.

22 Why do you promise him -- what did you promise him

23 exactly?"

24 Do you know what piece of paper you promised

25 him that is referring to?


Page 2060

1 A I don't recall specifically.

2 Q Do you know whether it had to do with

3 insurance?

4 A That actually refreshes my recollection. I do

5 recall him looking for an insurance policy. But I don't

6 know that that specifically is what he was looking for.

7 I would be guessing.

8 Q What do you recall about him wanting an

9 insurance policy?

10 A Somebody brought -- excuse me -- brought up

11 the fact to him -- excuse me -- that he was -- that

12 other -- other funders were looking for crime fraud

13 insurance.

14 And so he jumped on that bandwagon.

15 Q When you say "other funders," do you mean

16 related to Coquina or beyond Coquina investments?

17 A Other than Coquina.

18 Q And do you recall who those other funders

19 were?

20 A The hedge funds, and I believe certain people

21 from the -- Von Allmen, A.J., that group. But I'm not

22 certain.

23 Q Now, to your knowledge, had Mr. Damson ever

24 discussed the deals with anyone at the hedge funds?

25 A I don't know one way or the other.


Page 2061

1 Q Do you know whether he ever discussed the

2 deals with anyone in the Von Allmen group?

3 A I don't know.

4 Q You testified the other day that you recall

5 that Mr. Damson met Ted Morse at Bova.

6 A He did.

7 Q Do you recall that?

8 A He did.

9 Q Can you tell me what you recall about that?

10 A I just recall them meeting, I don't recall

11 what the specific conversations were.

12 Q Do you know why they met there?

13 A They met there because Barry Damson was

14 spending time with me. And I saw Ted, to the best of my

15 recollection, nearly every single evening of the week at

16 Bova's or some other bar and restaurant. So if he was

17 coming to meet me --

18 Q "He" being who?

19 A Barry. He was with me. He would be meeting

20 Ted.

21 Q And you recall that happening?

22 A I do recall them meeting, yes.

23 Q Other than that one time, do you recall them

24 meeting?

25 A I don't have a specific recollection, no.


Page 2062

1 Q At that point in time, to your knowledge, did

2 Ted Morse know there was a scheme going on related to

3 the deals?


5 A Again, using the word "scheme," I don't recall

6 what time frame it was, but judging by these emails and

7 when I was doing business with Barry, it is most likely

8 that, yes, Ted knew that there was a fraud going on.

9 BY MS. EVANS:

10 Q To your knowledge, did Ted Morse ever disclose

11 to Mr. Damson that there was a fraud related to the

12 deals?

13 A To my knowledge, no.

14 Q Turning to the next page, this is July 1,

15 "Damson wanta the paper."

16 Michael Szafranski writes to you, "He also

17 claims you agreed to send him the Onyx agreement. I

18 suspect the latter is inaccurate. Let me know so I can

19 force him on the 2.8."

20 Where he refers to the paper in the first

21 sentence, do you know what that is referring to?

22 A I do not.

23 Q Was Mr. Damson at this point in time, to your

24 recollection, asking for a letter from TD Bank?



Page 2063

1 Q Do you know if this refers, again, to

2 insurance?

3 A I don't recall.

4 Q Where he says "I suspect the latter is

5 inaccurate," do you know what he's referring to?

6 A Yes. Mr. Damson was trying to get a copy of

7 Onyx's agreement with other funds for which he was doing

8 independent verification and he was attempting to lie to

9 Mikey to try to get me to give it to him.

10 Q He was attempting to do what?

11 A To lie to Michael Szafranski about me agreeing

12 to give him the document.

13 Q And why was he doing that, because he wanted

14 the document?

15 A Yes.

16 Q And what was he attempting to find in the

17 document, if you know?

18 A The amount of finder's fees and the like Mike

19 was charging other lenders.

20 Q Did he ever express to you that a concern over

21 the finder's fee related to Mr. Szafranski that was

22 being paid by Coquina?


24 Q Did he ever express to you that he felt it was

25 too high?


Page 2064

1 A He frequently spoke to me about the fact that

2 Mike was making a lot of money. Whether he thought he

3 was making too much money, I can't tell you.

4 Q A lot of money from Coquina or a lot of money

5 overall, do you know what his concern was?

6 A I don't think it was a concern. I think it

7 was commentary.

8 Q Do you know what his commentary meant? How

9 did you -- what did you understand it to be?

10 A Mike was making a lot of money -- Mike was

11 making a lot of money all the way around.

12 Q Why would that concern Mr. Damson, if you

13 know?

14 A That's why I said it was commentary. You keep

15 using the word "concern." I keep correcting you and

16 telling you it was commentary.

17 Q Do you have any understanding as to why he was

18 commenting on it to you?

19 A I don't know.

20 Q How often in the period during which you knew

21 Mr. Damson did you see him lying?

22 A The only time I recall him lying was when he

23 was trying to play Mike and I against each other to get

24 something that he wanted.

25 Q Can you tell me instances where that --


Page 2065

1 A I considered it more of a business technique

2 than lying to me. Play both sides against the middle

3 and ultimately try to achieve your goal.

4 Q Why don't you tell me what instances that you

5 recall that he played you and Mike against each other by

6 lying?

7 A I don't have any specific recollection other

8 than what we just looked at.

9 Q When he says to you, let me know so I can

10 force him on the 2.8, do you know what he's referring to

11 there?

12 A I do.

13 Q And can you tell me what that is?

14 A We needed an infusion of capital into the

15 Ponzi scheme, and Mike was going to push the 2.8 deal

16 down Damson and Coquina's throat.

17 Q And did he accomplish that?

18 A To the best of my recollection, he did; but

19 the paper would answer that for you exactly, so I don't

20 want to guess.

21 Q That's fine. I'm asking for your independent

22 recollection.

23 Looking at Page 22, the middle email, Barry

24 Damson writes to Michael Szafranski, I certainly hope we

25 get these papers before 10:15. I am completely confused


Page 2066

1 as to why there was such a delay, but it doesn't build

2 much confidence.

3 Do you know what delay is being referred to

4 there?

5 A No. I've never seen this portion of the email

6 before, so I have no idea.

7 I don't recall seeing it, unless it was a

8 attached to this email up above.

9 Q Did you have problems with the deals ever

10 being delayed?

11 A Well, there were no real deals, so I don't

12 know what you mean "the deals being delayed."

13 Q Well, did you set dates with investors at

14 which point you would provide them -- you would

15 acknowledge to them that there was funding that had

16 happened for a deal, a fake deal?

17 A I don't recall ever having a problem telling a

18 client that the funds were in house. That was very easy

19 to phony up.

20 I recall there being delay in getting

21 paperwork to an investor.

22 Q Did that ever happen with Coquina, to your

23 knowledge?


25 Q Where Mr. Damson says "it doesn't build much


Page 2067

1 confidence" here, did he complain to you about having a

2 lack of confidence, that you recall?


4 A He -- he talked to me frequently about making

5 sure that we maintained creditability, that was the

6 speech he utilized to get me to do the fake plaintiff

7 signing in front of him, which he did not know was fake,

8 obviously.

9 But to get to see a plaintiff go through the

10 documents, that it would build credibility, I think that

11 was one of his speeches that he gave.

12 Q Did he want credibility, to your

13 understanding, for himself or for others?

14 A I would have to get inside his head to know

15 that. I don't know one way or the other.

16 Q He did not express to you from whom he was

17 seeking creditability?

18 A He may have.

19 Q You don't recall?

20 A I don't have a specific recollection.

21 Q If you'll turn to the last page. I think you

22 began to read it: Yesterday's --

23 A I did.

24 Q -- discussion, we did not bring up the two

25 items that we had been working on for sometime, and they


Page 2068

1 are, again, problems of credibility for you and me.

2 Do you recall, from looking at this email,

3 what the two items were?

4 A Give me a moment to go back through the email.

5 Q If you need to read it to see if that

6 refreshes your recollection, certainly.

7 A Okay. One of the issues was with regard to

8 transferring funds from an unsegregated account to a

9 segregated account and getting a bank statement.

10 He's looking for the bank statement. He wants

11 Mike to send it to him.

12 And he's looking for a $100,000 payment coming

13 due to him, that was due to him.

14 Q What were the circumstances of that $100,000

15 payment?

16 A I don't recall. You'd have to check the email

17 traffic.

18 Q Assuming there is no email traffic, do you

19 have any independent recollection of what the $100,000

20 was owed for?



23 BY MS. EVANS:

24 Q That means you have no recollection?

25 A It means I would be guessing.


Page 2069

1 Q Do you know if at this point in time,

2 October 14th, based on this email, you had represented

3 to Mr. Damson that investment funds were in a segregated

4 account?

5 A I recall having conversations with Mr. Damson

6 about segregated accounts. I don't recall that specific

7 conversation.

8 Q What conversations do you recall?

9 A I recall that they wanted their money in a

10 segregated account, but they didn't want it combined

11 with other people's funds.

12 And I recall setting up an account at TD Bank.

13 I believe it was TD 11. We called it TD 11, Coquina.

14 Q Did you personally set that up?

15 A No.

16 Q Who set it up?

17 A I had people that set up the bank accounts,

18 either Bill Brock or Irene Stay.

19 Q When would that have been set up, to your

20 knowledge?

21 A I don't have a specific recollection. All you

22 have to do is check the account opening paperwork.

23 Q You said you recall an account by the name TD

24 11, Coquina being set up; what do you recall?

25 A Actually, it would have been RRA 11, not TD:


Page 2070

1 RRA 11, Coquina.

2 Q And what do you recall about that being set

3 up?

4 A I recall that it was set up without any

5 issues. That was the beauty of TD Bank; they never

6 asked any questions.

7 MS. EVANS: Move to strike the last

8 portion of that question (sic) as

9 unresponsive.

10 BY MS. EVANS:

11 Q Do you recall when that was that that account

12 was set up again, independently?

13 A I already said I don't.

14 Q Who at your firm set up accounts at TD Bank?

15 A Bill Brock, Irene Stay, there may have others;

16 I don't recall at this moment.

17 Q Who are the people at your firm who were

18 signatories on any law firm account at TD Bank?

19 A I was always a signatory. Stu Rosenfeldt, to

20 my recollection, was always a signatory, unless it was a

21 personal account for me.

22 And then it would have varied. It could have

23 been -- Debra Villegas could have been a signatory.

24 Irene Stay could have been a signatory. David Boden

25 could have been a signatory, maybe even Grant Smith or


Page 2071

1 Russ Adler or Steve Lippman; but, again, this is -- it's

2 very easy to see, just look at the account records and

3 you can tell.

4 I had 20-some-odd, almost 30 bank accounts

5 there. I don't recall who the signatories were,

6 specifically.

7 Q Do you recall, with respect to the letters

8 that Mr. Spinosa signed for you at one point in time,

9 the letters referred to you as having a signatory

10 authority over the RRA accounts?

11 A You mean me, as opposed to me and Stu?

12 Q Correct.

13 A Yes, and I remember there being an issue with

14 that from one of our people that we were giving the

15 phony lock letters to.

16 Q Can you tell me what you recall about that?

17 A Yes. Someone wrote something to us, an email

18 to us, saying, basically, what happens if Scott is

19 incapacitated or dies. So I went to Stu and said, I'm

20 going to add you to these letters. And we added him to

21 the letters.

22 Q And that was the purpose, to give some

23 assurance to an investor of adding -- the purpose of

24 adding Mr. Rosenfeldt's name to the letter was to

25 provide assurance and to the investors; is that correct?


Page 2072

1 A Yes.


3 BY MS. EVANS:

4 Q Do you remember which investor?

5 A I don't. Email traffic would tell you,

6 Ms. Evans. There should be an email with someone

7 specifically requesting it, because I remember once they

8 requested it, we left it in the letter as long as Mr.

9 Spinosa was doing those letters for us.

10 Q Do you know if it was Mr. Lifshitz that

11 requested that?

12 A It's very possible.


14 BY MS. EVANS:

15 Q Why is that possible?

16 A Because he is an investor. I have already

17 told you one of the investors requested it. That means,

18 since Mr. Lifshitz is in the group we'll call

19 "investors," it's possible that he is the one who asked

20 for it.

21 Q Among many investors?

22 A I -- and the easiest way to do it, is just

23 look at the email traffic and it will tell you, because

24 I remember someone saying, what happens if I die or am

25 incapacitated.


Page 2073

1 Q And do you recall if, indeed, Mr. Rosenfeldt

2 was a signator on the accounts for which those letters

3 were written?

4 A You'd have to look at the accounts. I would

5 be guessing.

6 I intended him to be a signatory. The easiest

7 thing to do is check the signature cards.

8 Q What I'm asking for in a lot of these

9 questions is your independent recollection.

10 A I understand that, but I really want to make

11 sure that this record is clear. You have so much paper

12 evidencing these things, so I -- I want to make sure

13 that you also know that there is another way to make

14 sure you can get that. I understand you're trying to

15 see what I remember and what I don't. So let me answer

16 your question directly now that I've told you that.

17 I don't have a specific recollection as to

18 whether or not he actually signed the signature card

19 because I didn't bring the signature cards in to him;

20 but it was my absolute intention to have him be a

21 signatory.

22 Q Do you recall ever signing a signator card for

23 TD Bank?

24 A Yes.

25 Q So you did on occasion?


Page 2074

1 A On occasion, yes. I was brought a lot of

2 papers every day to sign, but I do recall signing

3 signator cards.

4 MS. EVANS: Exhibit 242 is Coquina 875.



7 BY MS. EVANS:

8 Q Now, this particular email, I think it may

9 have an email on the --

10 A It does. I was looking -- thanks.

11 Q Does this remind you that the piece of paper

12 that Barry wanted in the other July 1 email may have

13 been insurance? Does this refresh your recollection, is

14 my question.

15 A It doesn't refresh it one way or other. He

16 was looking for a lot of different things. Remember, we

17 also read about the fact that he was looking for the

18 Onyx agreement. He may have been looking for deal

19 paperwork. He may have been looking for a bank

20 statement.

21 Q What would the crime fraud insurance have done

22 for Mr. Damson, if you know?

23 A If I stole money, or anyone else from my firm

24 stole money, it would cover t.

25 Q And that was really the sole purpose of it,


Page 2075

1 correct?

2 A I don't know. I would have to get inside his

3 head to know what his purpose was.

4 I am telling you what my understanding of it

5 was from my perspective. What he was thinking it would

6 do, you have to ask him.

7 Q And you never got the insurance for him, I

8 believe you testified; is that correct?

9 A I never secured crime fraud insurance, no,

10 ma'am.

11 Q Did you try to secure it?

12 A Very lackadaisically.

13 Q Was it your goal not to secure it?

14 A I couldn't have cared one way or the other.

15 It wasn't instrumental to me. The fact is that whatever

16 I needed to do to continue keeping the Ponzi scheme from

17 exploding, that's what I was going to do. Ultimately,

18 if someone pushed me to get it, I would have continued

19 to try to get it.

20 Q At some point in time did Mr. Damson stop

21 pushing you to get it?

22 A I don't recall him ever stopping, no.

23 Q Exhibit 243, was produced, but it does not

24 have a Bates number. But it was an email from Scott

25 Rothstein to [email protected] and the subject is


Page 2076

1 "Frank" and the date is September 9, 2009.



4 BY MS. EVANS:

5 Q This email from you to Mel says -- well, let

6 me ask you first: Is this Mel Lifshitz; do you know?

7 A It is.

8 Q It says, he cannot -- well, let's look at the

9 email below it first.

10 Scott, please have him confirm on call

11 20 million his account on Wednesday, Thanks Mely. The

12 subject is "Frank."

13 Do you know what Mely is referring to there?

14 A Yes.

15 Q Can you tell me?

16 A He wants to speak to Frank and have Frank

17 verbally confirm the $20 million hit the account.

18 Q And looking at the top email: He cannot.

19 That is a crime. We discussed this when we first

20 started, and we discussed it when I called earlier.

21 Mike is the only one who can confirm this. My

22 apologies, but I will not break the law.

23 Do you recall the circumstances of that?

24 A I do.

25 Q Can you tell me about them?


Page 2077

1 A I was making an attempt to keep Mel from

2 discussing anymore with Frank than they had to discuss.

3 Q What did you mean by "that is a crime"?

4 A I made that up.

5 Q Did you have any idea what you meant by "that

6 is a crime"?

7 A That he would be discussing someone else's

8 account information.

9 Q Did you tell Mel Lifshitz that?

10 A I likely did, yes, because Mel was not one to

11 just take an email like this. He would generally speak

12 to me afterwards and tell me about it.

13 Q Again, you don't have any specific

14 recollection of saying that, though?

15 A I don't know.

16 Q Do you know what he did upon receiving this?

17 Did he go away and not ask about it anymore?


19 Q Do you know whether Frank ever spoke to him?


21 Q Did you ask Mr. Spinosa to speak with him with

22 respect to this issue?


24 A I do not recall. I do not recall.

25 BY MS. EVANS:


Page 2078

1 Q So to your knowledge, Frank Spinosa did not

2 speak with him --


4 ALL PRESENT: Object.

5 BY MS. EVANS:

6 Q -- with respect to that particular email?

7 A He may have. He may have; he may not have. I

8 just don't recall.

9 Q Do you know if Ms. Caretsky ever spoke with

10 anyone from Emess Capital?

11 A I do not.

12 Q Do you know if she ever met with anyone from

13 Emess Capital?

14 A I have no specific recollection.

15 Q Same question with respect to Ricardo Mejia,

16 do you know if he ever met anyone from Emess Capital?

17 A I don't have a specific recollection of that.

18 Q Do you know if he ever spoke with anyone from

19 Emess Capital?


21 Q Same question for Matthew Brennan, do you know

22 if he ever met anyone from Emess Capital?

23 A I don't have a specific recollection of that,

24 no, ma'am.

25 Q And do you know if he ever spoke with anyone


Page 2079

1 from Emess Capital?


3 Q When Mr. Brock visited the bank for what you

4 have described or what's been called "shows," can you

5 tell me what he did at any one of the "shows"?


7 A I wasn't there. I don't know.

8 BY MS. EVANS:

9 Q When he went to the so-called "shows," did you

10 tell him what he should do?

11 A Yes.

12 Q What did you tell him?


14 A From time to time I told him to make sure that

15 the statements got in with the letters. From time to

16 time I told him to check real account balances for me.

17 I mean, he was doing a lot of different things for me.

18 Are you talking about, did I give him specific

19 directions each time?

20 BY MS. EVANS:

21 Q Yes.

22 A If I did, it should be reflected in email

23 traffic.

24 Q You would have sent him an email and told him

25 precisely what to do each time?


Page 2080

1 A Not precisely, no.

2 Q Would you have told him what to do in an email

3 before he went every time?

4 A Every time, I don't believe so. We spoke

5 frequently, also. I mean, he would come downstairs when

6 we were preparing the phony bank statements, and he and

7 I and Deb would be sitting there together, looking at

8 the bank statements making sure they look accurate, so

9 we might discuss it at that point in time, also.

10 Q Did there come a time, to your knowledge, when

11 the bank changed systems, what they referred to as their

12 "system integration"?

13 A It seems to ring a bell, but I don't have a

14 specific recollection of that. That doesn't mean it

15 didn't happen.

16 Q Do you know if you were ever informed by

17 email, or anyone at your firm, that the bank had changed

18 its systems?

19 A I would imagine that if we -- that occurred,

20 that I would be informed by email; but I don't recall

21 seeing that email. If you have it, it would refresh my

22 recollection.

23 Q Do you have any knowledge whether or not the

24 bank's form of its account balance statements changed

25 after the bank systems were integrated?


Page 2081

1 A Now that you say that, I do recall something

2 changing with regard to the format of some bank

3 statement and us having to utilize Curtis Renie and Bill

4 Corte to reformat something, Deb and Bill working with

5 them, but I don't have a specific recollection as to

6 what that is. There should be email traffic as to that,

7 Ms. Evans.

8 Q Okay. Do you have any independent

9 recollection of what occurred with respect to asking

10 Curtis Renie to deal with the change?

11 A I don't.

12 Q Do you know whether you changed your fake form

13 of bank account statements at any point in time with

14 respect to the form of it?

15 A I don't recall one way or the other. I

16 certainly may have. If it was necessary to continue my

17 fraud, I most likely would have; but I would be guessing

18 without seeing the actual paperwork.

19 Q Do you know if you ever gave investors fake

20 forms at a point in time when TD Bank's forms looked

21 different?

22 A I would hope that I didn't back then. That

23 certainly would have been a fear of mine, but it's

24 certainly possible that I did.

25 Q Did you ever worry that in sending fake


Page 2082

1 letters or forms by email to someone, that they might be

2 able to just click on properties and see that it was a

3 fake letter?

4 A Did I have that specific worry? I don't

5 recall specifically worrying about that; but given the

6 massive nature of the crime I was committing, the sheer

7 number of people involved, I think you can safely say I

8 worried pretty much about everything that could possibly

9 go wrong; but I don't have a specific recollection of

10 that specific item.

11 Q You took a lot of risks?


13 A I definite --

14 MS. EVANS: What was wrong with the form?

15 MR. SCHERER: About 400 times he's

16 answered that question throughout this to you,

17 to all your lawyers that you are paying for

18 the various parties, for everybody else; and

19 I -- you know, I don't know, after the seventh

20 day in deposition, you're just trying to wear

21 the guy out. I'm going to object to the form

22 when you're doing repetitive, nonsensical

23 questions just to run the clock. And so

24 that's my objection.

25 MS. EVANS: Thank you for oration, Mr.


Page 2083

1 Scherer.

2 ALL PRESENT: Join in the objection on

3 behalf of Emess Capital.

4 MS. EVANS: I'm sorry, what?

5 UNKNOWN SPEAKER: Join in the objection

6 on behalf of Emess.

7 MS. EVANS: I'll take my time. I mean,

8 you took a week, and you're getting paid quite

9 handsomely as I understand.

10 BY MS. EVANS:

11 Q So the next question --

12 MR. SCHERER: At least I ask interesting

13 stuff that was pertinent.

14 MR. SCHNAPP: Bill, why don't you knock

15 it off.

16 MR. SCHERER: Since we're going back and

17 forth, we'll make it interesting here, I'll be

18 happy to do it.

19 MS. EVANS: I think you're wasting

20 valuable time here, Mr. Scherer.

21 MR. SCHERER: You should know that.

22 MS. EVANS: It's really inappropriate to

23 be uncivil, and I hope that you'll --

24 MR. SCHERER: You asked and I --

25 MR. LICHTMAN: Hold on. Hold on. Time


Page 2084

1 out. It's not that I'm the moderator here,

2 but I've taken a lot of responsibility over

3 the deposition.

4 Everybody has worked hard. We have been

5 here for a lot of days. Let's all just tone

6 it down now and get back to questions. Okay?

7 MS. EVANS: I think that's fair,

8 Mr. Lichtman. Thank you.

9 BY MS. EVANS:

10 Q I'm going to read out some names to your, and

11 I would just like to know whether or not you know any of

12 these individuals, if you can tell me that. It's a

13 fairly long list, but I need to ask because there --

14 it's a fairly long list of people that --

15 A Let me just get this -- are you done? I

16 didn't mean to cut you off. Were you done?

17 Let me just get this clarification so you

18 don't go through the list and have to go through it

19 again.

20 Q Yes?

21 A You need to define the word "know" for me.

22 Does "know" mean I have met them personally? Does

23 "know" mean I have talked to them over the phone? Does

24 "know" mean I may have heard their name in conversation?

25 If you clarify it for me, then I'll answer


Page 2085

1 your list; and please don't tell me you want to do it

2 three times with each of those definitions.

3 Q Actually, what I'm going to do is ask you to

4 tell me a couple of things, so we have don't have to go

5 through this three times.

6 A Okay.

7 Q In other words, if the name means anything to

8 you, if you either read their name, heard their name or

9 you met the person, I would like to know.

10 A I'll give you the specifics as to each person.

11 Q Okay. There is a second question that I have

12 with respect to that.

13 If you know the person, I would also like to

14 know whether or not they had any contact with TD Bank

15 related to your fraud.

16 A Okay. Knew me and whether they contacted TD

17 Bank -- had any contact with them at all?

18 Q With respect to your fraud.

19 A Right. Right. Okay. I got you, I think.

20 Q And the knew-you part -- I don't want to

21 complicate this -- is --

22 A Oh, no.

23 Q -- the name rings a bell, have you seen their

24 name connected with your fraud.

25 A I got the program. I'll be as clear as I


Page 2086

1 possibly can.


3 BY MS. EVANS:

4 Q Amy Adams?

5 A I do not know who that is.

6 Q Okay. Frank Adams?


8 Q Scott Adams?


10 Q Joseph Anania, A-N-A-N-I-A?


12 Q Janice Anania?


14 Q Ed Andricola, A-N-D-R-I-C-O-L-A?

15 A Unknown to me.

16 Q Mary Andricola?

17 A Unknown to me.

18 Q William Annechini, A-N-N-E-C-H-I-N-I?

19 A That name rings a bell, but I don't know why.

20 Q If it comes to mind while we're talking, will

21 you let me know?

22 A Yes.

23 Q Clair Annechini?

24 A Same answer with regard to the other

25 Annechini: Rings a bell but I don't know who or why.


Page 2087

1 Q Veronica Bekkedam.

2 A I'm sorry?

3 Q Veronica Bekkedam?

4 A The name "Bekkedam" I know, but I don't know

5 who Veronica is.

6 Q The Belk Foundation, B-E-L-K. Any connection

7 with them?

8 A No.

9 Q Peter Benedict of Vero Beach, Florida?

10 A Unknown to me.

11 Q The Benedict Foundation?

12 A Unknown to me.

13 Q Harry Booth, B-O-O-T-H?

14 A Unknown to me.

15 Q Antoinette Booth?

16 A Unknown to me.

17 Q Anthony Bonomo?

18 A Let me just get this clarification.

19 That does not mean that I did not meet these

20 people at a meet-and-greet; it's just that I have no

21 knowledge of meeting them.

22 Q Okay.

23 A Okay. Go ahead, next one.

24 Q Anthony Bonomo, B-O-N-O-M-O?

25 A Unknown to me.


Page 2088

1 Q Mary Ellen Bonomo?

2 A Unknown to me.

3 Q Hugh Brennan, B-R-E-N-N-A-N?

4 A Rings a bell, not sure why.

5 Q Scottsdale, Arizona, that's where he is

6 located.

7 A Don't know.

8 Q Edward Carlisle?

9 A Unknown to me.

10 Q Carmen Caruso?

11 A The name Caruso rings a bell, but I think

12 that's because I had a friend whose last name was

13 Caruso. So I'm going to say that's unknown to me.

14 Q She resides in Gulph, G-U-L-P-H, Mills,

15 Pennsylvania; does that ring a bell?

16 A No, now it's unknown to me.

17 Q Okay. Fred Davis?

18 A Unknown to me.

19 Q Pat Davis, P-A-T?

20 A Unknown to me.

21 Q Eugene Dowd, D-O-W-D?

22 A Unknown to me.

23 Q Charles Farrell?

24 A Unknown to me.

25 Q Ruth Farrell?


Page 2089

1 A Unknown to me.

2 Q Dr. Herbert Feinberg of Englewood, New Jersey?

3 A Unknown to me.

4 Q Steven Fink, F-I-N-K?

5 A Unknown to me.

6 Q Brian Graden?

7 A Unknown to me.

8 Q G-R-A-D-E-N.

9 William Hauser, H-A-U-S-E-R?

10 A Unknown to me.

11 Q Judd Klement, K-L-E-M-E-N-T?

12 A Unknown to me.

13 Q Amy Rowe Klement?

14 A Unknown to me.

15 Q The McFadzean -- and that's spelled

16 M-C-F-A-D-Z-E-A-N -- 1998 Trust?

17 A Unknown to me.

18 Q Arla, A-R-L-A, Mertz, M-E-R-T-Z?

19 A Unknown to me.

20 Q Barbara Mitchell?

21 A Unknown to me.

22 Q Pauline Monson?

23 A Unknown to me.

24 Q Nancy Paley, P-A-L-E-Y, of Aspen, Colorado?

25 A The Paley family I have heard of. I believe


Page 2090

1 that they have some relation to the group that came in

2 with the Von Allmens. Other than that, I don't know who

3 it is.

4 And I don't remember whether I heard the name

5 before or after the Ponzi exploded.

6 Q That was -- you anticipated my next question:

7 Is that something that you uncovered since the -- or

8 learned since the Ponzi scheme?

9 A I can't tell you one way or the other.

10 Q Do you know if there are any clients of Mr.

11 Scherer that are named "Paley" in the Razorback matter?

12 A I just don't remember.

13 Q Have you ever met any of the Paleys that are

14 related to the fraud?

15 A I don't believe I did, no.

16 Q Do you know if anyone from TD Bank ever met

17 them?

18 A I do not know.

19 Q Paulette Perhacs, P-E-R-H-A-C-S?

20 A Unknown to me.

21 Q Daniel Radomski, R-A-D-O-M-S-K-I?

22 A Spell the last name again.

23 Q R-A-D-O-M-S-K-I.

24 A Unknown to me.

25 Q Frederick Rosen, R-O-S-E-N?


Page 2091

1 A I don't remember.

2 Q Lawrence Rovin, R-O-V-I-N?

3 A Larry Rovin?

4 Q Merion, Pennsylvania.

5 A I met him.

6 Q Can you tell me when you met Mr. Rovin?

7 A I don't remember when I met him, but I met him

8 during the time that there was due diligence going on

9 with the Bekkedam/Ballamor folks.

10 Q Where did you meet him?

11 A To the best of my recollection, it was in my

12 office.

13 Q You met him only once?

14 A I don't remember how many times I spoke to him

15 on the phone, as well.

16 Q Okay. Going back to your office, do you know

17 when that occurred?

18 A I do not.

19 Q Do you recall what you discussed?

20 A Due diligence issues.

21 Q When you say "due diligence issues," can you

22 be more specific?

23 A We discussed what was going to go on when

24 there were audits of the Ballamor and Bekkedam

25 paperwork, the BIF paperwork. He asked me questions


Page 2092

1 about the settlement strategy. That's basically it.

2 Q Do you recall what relationship he had to

3 Barry Bekkedam, if any?

4 A My understanding was he was Bekkedam group's

5 general counsel, that he would be handling the due

6 diligence, overseeing it and handling audits.

7 Q When you referred to an audit, what type of

8 audit? What knowledge did you gain about an audit?

9 A I actually gained none because they never did

10 any.

11 Q Did it concern you that they were

12 contemplating an audit?

13 A Yes, anything like that would, you know,

14 concern me in the middle of what I was doing; but it

15 turned out to be an unnecessary fear because they never

16 did anything related to an audit.

17 Q Do you recall what questions he had about the

18 settlement?

19 A I don't.

20 Q Do you recall what due diligence he performed,

21 if any?

22 A It was insignificant. I don't recall him

23 asking very many questions.

24 Q Do you know how long you met with him?

25 A I do not.


Page 2093

1 Q Did you take him out to lunch or dinner; do

2 you recall?

3 A I actually don't recall eating with him.

4 Q Okay. You said you also had a phone call with

5 him, just one phone call?

6 A I likely just talked to him on the phone, but

7 I don't remember if I did or how many times. It seems

8 to me that I would have spoken to him on the phone.

9 Q After your meeting?

10 A Yes, and I may have emailed with him, as well.

11 I seem to recall sending him emails, but I don't recall

12 the context.

13 Q Okay. All right. Do you recall the context

14 of any phone call that you had with him?

15 A I do not.

16 Q Richard Ruch, R-U-C-H?

17 A Don't remember.

18 Q Ivan Scharer, S-C-H-A-R-E-R?


20 Q Jay Scharer?


22 Q Thomas Schirmer, S-C-H-I-R-M-E-R?


24 Q Stacy Selverne, S-E-L-V-E-R-N-E?

25 A I seem to recall seeing that name after the


Page 2094

1 Ponzi scheme exploded, but I don't have any other

2 recollection of who that is.

3 Q Do you know with whom you saw it?

4 A No.

5 Here's the thing you should know: All the

6 names you have read to me may be on a list of the

7 victims of my crimes, so I may have seen them, and it

8 could be that I just don't remember the names.

9 Q Okay. Michael Selverne, S-E-L-V-E-R-N-E?

10 A That's going to be the same answer: I

11 remember hearing the name, but I don't remember where or

12 why.

13 Q Okay. Seravalli, S-E-R-A-V-A-L-L-I, Financial

14 Group?

15 A I do not remember.

16 Q Marc Smith?

17 A Do not remember.

18 Q William Spink, S-P-I-N-K?


20 Q Duce, D-U-C-E, Staley, S-T-A-L-E-Y?


22 Q Eileen Taylor?


24 Q We're moving down in the alphabet, so we're

25 getting there.


Page 2095

1 A That's okay.

2 Q Donald Travis, T-R-A-V-I-S?


4 Q Kim Tuski, T-U-S-K-I?


6 Q Brent Ware, W-A-R-E?


8 Q Judy Ware?


10 Q Scott Ware?

11 A I don't know why that name is ringing a bell

12 to me, but I don't know who that is.

13 Q Franklin, Tennessee?

14 A No, it's not ringing a bell.

15 Q I asked you this the other day, but I want to

16 give you the full name: Whiteoak Global Advisors?

17 A Say that, again, I'm sorry?

18 Q Whiteoak Global Advisors, LLC?

19 A Doesn't ring a bell.

20 Q Nick Worontzoff. Worontzoff -- I'm going to

21 spell that for you because I am not doing a very good

22 job of pronouncing it: W-O-R-O-N-T-Z-O-F-F?


24 Q Debra Zuccanari?



Page 2096

1 Q Andre Haddock?

2 A Don't remember.

3 Q Joe Da Salva or Da Silva?

4 A That name rings a bell, some relation to

5 Banyan.

6 Q Okay. Do you recall anything about him or his

7 relation to Banyan?

8 A George Levin had a relative whose name was

9 Joe. I just don't know if that was Joe Da Silva. It

10 may have been; and if it was that person, I did meet him

11 in Mr. Levin's office.

12 Q Do you recall this person whose name you're

13 not sure of in Mr. Levin's office, what you met about

14 with this person?

15 A No. But I was in Mr. Levin's -- Mr. Preve's

16 offices frequently. I recall someone named Joe being

17 there and the person being introduced as a relative. I

18 don't know whether it was an in-law or a cousin. I

19 don't recall what it may have been; but I recall meeting

20 someone, Joe. For some reason I'm recalling that the

21 last name was Da Silva, but I can't be certain for you.

22 Q During the Ponzi, did Mr. Preve have a

23 different office from Mr. Levin, or did they have an

24 office in the same place?

25 A No. It was in the same place, next to each


Page 2097

1 other.

2 Q How often would you say you were in

3 Mr. Levin's office during that period of time?

4 A When you say "Levin," you mean the entire

5 Banyan operation or specifically in his office, within

6 his offices?

7 Q The entire Banyan operation.


9 A The entire Banyan Offices, I was there

10 frequently.

11 BY MS. EVANS:

12 Q Weekly?

13 A At least weekly, yes.

14 Q Was it daily?


16 A There were times when I was there daily.

17 BY MS. EVANS:

18 Q Okay.

19 A But unless I -- I will tell you this: Unless

20 they were on vacation, not available, I was there at

21 least once a week.

22 Q How often when you were there, was Mr. Levin

23 there?

24 A Infrequently.

25 Q So you would there generally to see Mr. Preve;


Page 2098

1 is that accurate?

2 A Ninety percent of the time.

3 Q Is it fair to say you talked with Mr. Preve

4 every day?

5 A Unless he was -- there was -- there were a few

6 times when he was having dental surgery and when he was

7 in the hospital having something else done, other than

8 that, at least during the weekdays, I spoke to him -- I

9 would say, better than 80, 85 percent of the time I

10 spoke to him on a daily basis.

11 Q Anthony Degennaro, does that name mean

12 anything to you?

13 A It rings a bell, but I don't know why.

14 Q You've never met him, as far as you know?


16 Q You don't recall ever asking TD Bank to speak

17 with him, either, anyone at TD Bank?

18 A I don't remember that.

19 Q How often did you utilize conference rooms at

20 TD Bank?


22 A Whenever I needed them, and only for the

23 shows. I didn't go in there to use them for any other

24 purpose.

25


Page 2099

1 BY MS. EVANS:

2 Q And there was an objection to the form, so let

3 me ask the question differently.

4 How often did you go into a conference -- any

5 conference room at TD Bank, at the TD Bank Weston

6 branch?

7 ALL PRESENT: Same objection.

8 A Only for some of the shows --

9 BY MS. EVANS:

10 Q Okay.

11 A -- not even all of the shows.

12 Q Do you remember how many times you went there?

13 A I would be guessing. I do not know.

14 Q Can you describe the conference room for me at

15 the Weston branch?

16 A It was fairly large. It had a nice size table

17 in it. It had windows, looking out into the -- into the

18 branch itself.

19 Q So you could see, from the branch, itself,

20 into the conference room; is that correct?

21 A Yes.

22 Q Did it have a glass wall?

23 A That's what it appeared to be to me, yes.

24 Q Do you recall what investors you met in a

25 conference room at the TD Bank Weston branch?


Page 2100

1 A I don't. I don't have a specific

2 recollection.

3 Q Do you recall the names of all investors that

4 you brought to the TD Bank Weston branch?

5 A I do not.

6 Q Do you recall any names of any investors that

7 you brought to the TD Bank Weston branch?

8 A I can give it a shot for you.

9 Q A shot as to the ones you specifically recall

10 would be helpful.

11 A Okay.


13 A To the best of my recollection, I brought --

14 are we talking the Weston now?

15 BY MS. EVANS:

16 Q Yes.

17 A Ira Sochet, Jack Simony, Michael Szafranski,

18 Barry Damson, that's all I recall at this moment. I'm

19 certain there are more.

20 Q Did you take Barry Damson inside the TD Bank

21 Weston branch?

22 A I don't recall whether we just pulled up and I

23 went in and got something or he actually went in with

24 me.

25 Q Do you have a recollection of having taken him


Page 2101

1 in?

2 A I don't. I only have a recollection of

3 bringing him to -- my specific recollection is bringing

4 him to Spinosa's office up on Cypress Creek. So it's

5 possible that I'm mistaken, but for some reason, I think

6 before we ever went to Cypress Creek, at some point in

7 time prior to that, we went to the branch itself. But I

8 don't recall whether he came in with me or not.

9 Q Do you recall Mr. Damson ever asking you to

10 visit a TD Bank branch, asking you to take him to visit

11 a TD Bank branch?

12 A I would be guessing. I believe he did, but I

13 don't know one way or the other.

14 Q Did you ever take Kathleen White to a TD Bank

15 branch, any of them?

16 A I don't recall whether I did specifically or

17 not.

18 Q And same question to Mel Klein, did you ever

19 take him to any specific TD Bank branch?

20 A I may have. I don't recall.

21 Q You don't recall.

22 With respect to Mr. Szafranski, how many times

23 did you accompany him to a TD Bank branch?

24 A More than several.

25 Q But you don't recall the specific number?


Page 2102

1 A I do not.

2 Q And why did you take him to a TD Bank branch?

3 A To verify balances.

4 Q Did you have investors with you, as well --

5 A I may have.

6 Q -- on those occasions?

7 A I may have. You'd have to ask the investors.

8 I just don't have a specific recollection.

9 Q When you say "to verify balances," did you go

10 up to a teller? Did one of you go up to a teller and

11 ask for a balance? What occurred?

12 A No.

13 But I do recall Mike Szafranski lying to an

14 investor and telling an investor -- I think I actually

15 saw it in an email, and I remember actually discussing

16 it at some point in time with Mike -- that he had told

17 an investor that he had verified balances at a teller

18 window, which he never did -- we never did.

19 Q And you know that he never did how? How do

20 you know that?

21 A Because I discussed it with him; he never did.

22 Q So you're relying on his word that he never

23 did?

24 A Yes.

25 Q Okay. Jack Simony, did you take him to the


Page 2103

1 Weston branch?

2 A I believe I said I did. Yes, I believe I did.

3 Q Okay. Did you also take him to the Deerfield

4 branch?

5 A Yes.

6 Q And just to round it out, did you ever take

7 him to the 17th Street branch?

8 A I don't recall one way or the other.

9 Q Okay. How many times did you take Mr. Sochet

10 to the Weston branch?

11 A There is only one time that I remember, off

12 the top of my head, driving out there with him.

13 Q Did he meet anyone at that time at the branch

14 to your recollection, any TD Bank employee?

15 A I don't have a specific recollection one way

16 or the other. If someone was available to say hey to

17 him, yes, but you'd have to ask him.

18 MS. EVANS: Okay. Would you like to take

19 a brief break for about five minutes?

20 THE WITNESS: If you would like to, yes.

21 MS. EVANS: I have a request for one.

22 THE WITNESS: Sure.

23 (Whereupon, a recess was had.)

24 MS. EVANS: Ready.

25 MR. NURIK: Excuse me, Ms. Evans, before


Page 2104

1 we begin, I want to put something on the

2 record.

3 MS. EVANS: Certainly.

4 MR. NURIK: The amended protocol order

5 regarding the deposition of Scott Rothstein,

6 specifically paragraph six, says that

7 paragraph 11 of the protocol order is amended

8 to the extent that all parties are required to

9 exchange the exhibits that they reasonably

10 expect to introduce at their respective

11 depositions to all appropriate counsel by

12 5:00 p.m. on December 8th, 2011, through email

13 PDFs, and then it provides how they should be

14 numbered.

15 It is my understanding that I, as

16 representative of Mr. Rothstein, as his

17 counsel, and since Mr. Rothstein is a party, I

18 have not received all the exhibits from all

19 counsel pursuant to this order.

20 Therefore, I am specifically requesting

21 that today, your offices immediately email me

22 all of the exhibits that you expect to

23 introduce in in your questioning of my client

24 going forward and to the extent that you have

25 any of these exhibits present with you now,


Page 2105

1 that you can provide a copy to me in advance

2 of my client being deposed on these matters.

3 I am requesting that.

4 I believe it's required by the court

5 order, and I don't understand why that was not

6 done beforehand by all counsel.

7 I am not looking to interfere with or

8 suspended or delay this deposition, but I want

9 it clearly understood that if I do not receive

10 that by the end of the day today from your

11 offices, that I will seek immediate relief

12 from the Court.

13 MS. EVANS: Do you know if you were on

14 the distribution list?

15 MR. NURIK: It does not appear I was on

16 the complete distribution list, and whether I

17 was on the distribution list or not, I think

18 this order supersedes any mistakes that may

19 have been made in the distribution list.

20 So I'm not blaming anybody; I'm just, at

21 this point, making sure that, going forward,

22 this order is complied with.

23 MS. EVANS: As a matter of helping you

24 out, let me ask you this: A lot of

25 individuals set up a site because it is such a


Page 2106

1 voluminous amount of documents, your whole

2 system could crash, do you want to give folks

3 some email address or site --

4 MR. NURIK: Yes, my -- well, my email

5 address everybody should have. It's Marc,

6 M-A-R-C at Nurik Law, N-U-R-I-K-L-A-W, dot

7 com.

8 If you want to provide me in the morning

9 with hard copies, that would be ideal, as

10 well.

11 I don't know if there's a site that you

12 can direct my staff to go to. The problem is,

13 at this point, I may not have enough copy

14 machines to make hard copies if everybody is

15 going to be loading this on to me now.

16 I just want to make this as matter of

17 record and ask that you all comply with my

18 request. Thank you.

19 MR. CUSICK: I'm also going to join in in

20 Mr. Nurik's comments. This is Casey Cusik on

21 behalf of Emess Capital. We haven't been

22 provided with copies of any of the exhibits

23 used by any of the parties in this deposition.

24 We have made requests to counsel for the

25 trustee for copies of those exhibits. Those


Page 2107

1 requests have been unanswered. We would

2 request that we be given immediate copies --

3 immediately given copies of the exhibits used

4 today by TD and yesterday, as well, before the

5 end of the day, along with the copies of all

6 of the other exhibits used the deposition.

7 I'll provide my email address for the

8 record, which is C-C-U-S-I-C-K at Kluger,

9 K-L-U-G-E-R, Kaplan, K-A-P-L-A-N, dot com.

10 And if there's a distribution list that

11 we were supposed to be a part of, we were not

12 aware of it. We are now aware of it, and if

13 there is information that can be given to us

14 in this regard, we would like to receive it.

15 Thank you.

16 MR. NURIK: I also would request copies

17 of what has been used so far to date be

18 provided to me, as well.

19 Thank you.

20 MS. EVANS: Thank you.

21 BY MS. EVANS:

22 Q Mr. Rothstein, do you recall at any point in

23 time -- well, actually not any point in time -- in 2009,

24 an IRS audit of RRA?

25 A No, ma'am.


Page 2108

1 Ms. Evans, during the break I also remembered

2 that I took Ted Morse. It was at the very end of

3 everything. I took Ted Morse to TD Bank.

4 So the list that I provided to you as to who I

5 actually took out there, would be to the best of my

6 recollection; there may be more people that I took out

7 there.

8 Q When you say it was at the end of things, do

9 you recall what month?

10 A It should be reflected on the -- it would have

11 been the same day, actually, as the phony order that I

12 did in the Jan Jones case. I don't recall specifically.

13 Q Do you recall why you took Ted -- was it to

14 the Weston branch?

15 A It was.

16 Q Do you recall why you took Ted to the Weston

17 branch that day?

18 A Pick up a statement.

19 Q Okay. Why? What kind of bank statement were

20 you picking up?

21 A A fake one.

22 Q And was Mr. Morse aware of the fraud going on

23 at that point in time?

24 A He was --



Page 2109

1 BY MS. EVANS:

2 Q Why did you take Mr. Morse, who knew of the

3 fraud at that time, to a TD Bank branch to pick up a

4 statement?

5 A Two reasons. One, we needed plausible

6 deniability, so he could tell his father he went to the

7 bank; and also, more than that, I needed the original

8 cover letter.

9 Q And you needed the original cover letter why?

10 A Because I needed to turn the original cover

11 letter that -- Carol Morse was demanding originals of

12 everything, so I needed to get originals.

13 Q The statement that you picked up at TD Bank,

14 did you use it for anything? You said you pick the up a

15 cover letter and a statement; is that correct, an

16 account statement?

17 A Cover letter and fake bank statements.

18 Q You went to TD Bank and they gave you a fake

19 bank statement?

20 A I don't recall the exact circumstances of that

21 visit.

22 Q Did Ted Morse rely on anything, to your

23 knowledge, that he received that day that you received

24 from TD Bank?

25 A Ted Morse?


Page 2110

1 Q Yes.

2 A No. Because Ted knew that there wasn't

3 sufficient funds in that account.

4 Q The next exhibit I don't believe was produced

5 as part of the exhibits, but we will --

6 A I'm sorry, I didn't hear you Ms. Evans, you

7 said this was not produced?

8 Q I am mumbling. Give me just a second, and I

9 will make it more articulate, hopefully.

10 A That's okay.

11 Q Let's mark this 244.



14 BY MS. EVANS:

15 Q 244 is a March 11th, 2009, email from Mark

16 Thaw, and at the top it says, the IRS has asked to see

17 the tax returns of the officers of this company. They

18 have that right. They will agree W-2, 1099, etc.,

19 really no big deal, and it has been done by Lisa sending

20 her info direct to the agent. The agent is a reasonable

21 nitpicker and, therefore, I needed the minute book and

22 the rest of the legal stuff as set forth in only one and

23 two below. Call first to discuss.

24 Can you tell me, was there any IRS audit in

25 2009 of your -- does that remind you that there was an


Page 2111

1 audit?

2 A There was no audit of Rothstein, Rosenfeldt &

3 Adler in 2009.

4 Q Okay. And do you -- okay. That's all I need

5 to know.

6 A Do you want to know what this email is?

7 Q No, that's all I needed to know.

8 A I want the record to reflect that this is

9 regarding Southern Grouts & Mortars audit. Carlos

10 Flores is the CFO of Southern Grouts & Mortars. Lisa is

11 Ron Picou's executive vice president and daughter.

12 Q Okay.

13 A It has nothing to do with RRA.

14 Q You said that -- you testified that when Bill

15 Brock went to the bank, that you never saw him switch a

16 document; is that correct?

17 A I was never with Bill at the bank during what

18 I'm call the "pre-show," so I don't -- I can't tell you

19 what he did there.

20 Q Okay.

21 A I can only tell you what occurred when I

22 walked in.

23 When I walked in, someone from the bank would

24 hand it to me. Everything else, I'm guessing.

25 Q Would hand an envelope to you?


Page 2112

1 A Yes.

2 Q Did you ever see someone from the bank

3 physically switch a document in the envelope?

4 A No, ma'am.

5 Q You don't have any personal knowledge, do you,

6 of who switched any documents in the envelope, do you?

7 A I do not.

8 Q Now, you had a meeting in September at the

9 Cypress branch -- strike that.

10 I think there was one name I left off of the

11 list that I wanted to ask you, actually.

12 A Sure.

13 Q Do you know Barry Florescu?

14 A I do.

15 Q Okay. Can you tell me what your relationship

16 during the fraud was with Barry Florescu?

17 A Barry Florescu was a legitimate investor,

18 innocent investor, brought into the Ponzi scheme through

19 what I'll call the Boden/Pearson group. He was brought

20 in by Andrew Barnett under the Boden umbrella and -- to

21 invest in the fraud.

22 Q Do you ever meet with him --

23 A Yes.

24 Q -- Mr. Florescu?

25 A Yes.


Page 2113

1 Q How many times?

2 A Several, actually, because I had met him prior

3 to all of this, meaning his investment on a casual basis

4 at friends' homes.

5 Q Who pitched the scheme to or the deals to

6 Mr. Florescu, as far as you know?

7 A It would have been Boden and Mr. Barnett.

8 Q Do you have any knowledge of whether

9 Mr. Florescu ever questioned the deals in any fashion?

10 A I do.

11 Q Can you tell me about that?

12 A My understanding is that he questioned it at

13 length.

14 Q And how did you gain that understanding from

15 him?

16 A I remember him coming to my office with

17 someone who I believed to be was his lawyer, meeting

18 with me for an hour or more, asking me a series of

19 questions.

20 Q Do you know what questions --

21 A Hang on.

22 Q I'm sorry.

23 A That's okay.

24 And I remember David Boden telling me that he

25 was answering a lot of questions, and I remember there


Page 2114

1 being a lot of email traffic back and forth, adding

2 things to document packets for Mr. Florescu, changing

3 documents around, that type of thing. He was a very

4 active investor.

5 Q Active by virtue of asking a lot of questions?

6 A And he was very demanding. He was asking for

7 changes, I remember, Mr. Boden -- there should be email

8 traffic evidencing Mr. Boden making changes and the

9 like.

10 Q Do you know what type of changes he was

11 requesting?

12 A I don't recall, but the email traffic would

13 evidence that.

14 Q Do you know if he requested substantive

15 changes to the deal documents?

16 A My recollection is that he did; but, again,

17 Ms. Evans, the email traffic would be the best evidence

18 of that.

19 Q And you don't have any recollection,

20 independent recollection?

21 A No, ma'am. I recall him asking for changes; I

22 don't know what the extent was.

23 Q When he -- did he -- do you have a

24 recollection of him being in your office more than once?

25 A I don't have a specific recollection one way


Page 2115

1 or the other, but I recall him being there.

2 Q The day that you mentioned he was there, do

3 you -- or that you recall, do you recall what questions

4 he asked, what specific questions he asked?

5 A I do not, and when you say my office, I recall

6 him being in my office within my offices. I recall him

7 also being there to meet with Mr. Boden, but I can't

8 tell you how many times.

9 Q Was your office within the law firm guarded by

10 any individuals --

11 A For --

12 Q -- at any point in time?

13 A For several months, on and off, I did have

14 bodyguards outside the office, and then I stopped that.

15 Q Do you know what months you had them there?

16 A I don't.

17 Q Did any investors ever question why you had

18 guards outside your office?

19 A They may have. I don't have a specific

20 recollection.

21 Q Do you recall if Mr. Florescu ever spoke with

22 Mr. Spinosa?

23 A I have a recollection that Mr. Florescu knew

24 Mr. Spinosa from before, so he very well may have. I

25 don't recall specifically whether he did or not.


Page 2116

1 Q So you don't have any independent recollection

2 of --

3 A I recall seeing some email traffic indicating

4 to me that Mr. Florescu either knew or had some way of

5 knowing Mr. Spinosa from before and that he did, in

6 fact, speak with him; but I don't know that personally,

7 only from what I saw.

8 Q You never asked Mr. Spinosa to speak with

9 Mr. Florescu by phone?

10 A I don't recall that one way or other. I may

11 have, but I don't recall.

12 Q And you don't recall ever asking Mr. Spinosa

13 to meet with Mr. Florescu?

14 A I don't recall one way or the other. I may

15 have.

16 Q Going to the day that you said you met with, I

17 believe, Mr. Damson, I believe you said Ms. White may

18 have been there in the Cypress office at TD Bank?

19 A No, in the Cypress office I'm almost positive

20 Ms. White was with us.

21 Q Okay.

22 A I seem to recall them both driving there with

23 me.

24 Q Okay. So moving to that meeting, I have a

25 couple of questions about that. I want to make sure I


Page 2117

1 understand your testimony, so please correct me any

2 misstate anything.

3 My understanding was that you said Frank

4 Spinosa should represent to them a balance with a

5 cushion; is that correct?


7 A To the best of my recollection, I told Frank

8 that if they asked about the balances, I gave him a

9 number and said, leave some cushion, leave some room.

10 Q What did you mean by "leave some room, leave a

11 cushion"?

12 A That if he was going to change the number that

13 I gave, go over, not under, that they were expecting an

14 amount to be in the bank.

15 Q Did you give him an amount?

16 A To the best of my recollection, yes. I have

17 no idea how could he have possibly done it if I hadn't

18 given him an amount.

19 Q Do you recall what amount you gave him?

20 A I do not.

21 Q Do you recall how you arrived at the amount?

22 A I got the information from Irene and from

23 Debra and from Mr. Szafranski.

24 Q And to your recollection, did he represent an

25 amount to them?


Page 2118

1 A To the best of my recollection, it was during

2 that meeting that Mr. Spinosa verified the balance. He

3 verified a number of things during the meeting, that I

4 recall.

5 Q Do you have a specific recollection of him

6 providing a number to you?

7 A At that meeting?

8 Q Yes.

9 A I do. It is my recollection that it was at

10 that meeting -- because, see, I'm balancing this out,

11 and let me explain myself.

12 We had the telephone call, and we had the

13 meeting.

14 To the best of my recollection, on the

15 telephone call, Mr. Spinosa stuck to our script, which

16 did not include a balance. To the best of my

17 recollection, it was at the meeting, face to face, where

18 he gave the balance. That's to the best of my

19 recollection as I said sit today.

20 He also verified that we were a good customer,

21 that we maintained significant balances in the bank,

22 that his money was safe; and he verified that the lock

23 letters did, in fact, prevent the movement of that money

24 anywhere but to the account listed on the letter, and he

25 explained how that worked.


Page 2119

1 Q Did you have a plan that day, as you recall,

2 for what you would do if Mr. Damson and Ms. White asked

3 for a printout of the account?

4 A I did not, and that was a constant concern to

5 me throughout the course of the Ponzi scheme.

6 Q Did you give any thought that day to having

7 Mr. Spinosa have a printout of the account?

8 A I never gave a thought to having anyone, until

9 I was pushed to do that.

10 Q So had they asked that day for a printout,

11 your scheme may have -- your Ponzi may have exploded

12 right then and there?

13 A That -- that is the case. That is a

14 potentiality of many, many events throughout the course

15 of the entire Ponzi scheme and all its tentacles, that

16 it could have exploded due to a lack of preparation on

17 the part of me and my co-conspirators flying by the seat

18 of our pants from time to time; and also, that it's

19 really impossible to prepare for every contingency.

20 Q Do you recall at that meeting whether either

21 Mr. Damson or Ms. White expressed any -- whether they

22 questioned the balance that Mr. Spinosa told them?

23 A I don't know what that means.

24 Q Let me ask that a different way.

25 A Sure.


Page 2120

1 Q Did either Mr. Damson or Ms. White say to you

2 or Mr. Spinosa, that's too little money in the account,

3 that number, there should be more in the account?

4 A I don't recall them saying that.

5 The bulk of the questions that occurred during

6 that meeting pertained to the lock letter and the

7 mechanics. I didn't even quite understand the

8 mechanics, I guess because there really were no

9 mechanics; but that's my recollection.

10 Q In preparing for that meeting, when did you

11 communicate with Mr. Spinosa to set up that meeting?


13 Q Do you recall if you emailed him the details

14 for the meeting?

15 A If I emailed him the details of the meeting?

16 I would not have emailed him about the illegal portion

17 of the meeting, so I might have -- I certainly might

18 have set up a meeting with him by email.

19 Q Do you recall when or how you communicated to

20 him the balance that you would like him to provide to

21 Mr. Damson or Ms. White?

22 A I believe it was -- I did it verbally.

23 Q On the same day as the meeting, do you recall?

24 A I don't recall one way or the other. I don't

25 want to guess.


Page 2121

1 Q Do you recall if it was in person or by phone?


3 Q This is Exhibit 245.



6 MS. EVANS: And it has SWRTD 3949 and

7 3950 at the top of it.

8 THE WITNESS: Okay. I've read it.

9 BY MS. EVANS:

10 Q Okay. Both pages?

11 A Both pages, this was an easy one to read.

12 Q All right. Can you tell me whether you recall

13 the circumstance of these two emails?

14 A The specific circumstances, I do not; but this

15 looks like me in a panic over balances.

16 Q Let me ask you this: Was this the same day,

17 that September 25th that you met with Mr. Damson and

18 Ms. White?

19 A It certainly appears to be. I don't want to

20 guess, but the fact that I am writing "urgent," okay,

21 that this balance must be increased by $6 million right

22 now and to update the time and date to right now, tells

23 me -- and since it's Coquina, okay, it refreshes my

24 recollection that Mr. Damson and Ms. White were about to

25 walk into my office to review balances.


Page 2122

1 Q This says "Coquina 12." Now, a few minutes

2 ago, I think you meed Coquina 11. Were there two

3 different accounts or do you recall?

4 A There may have been two different. I may have

5 been -- I may have been mistaken when I said 11. I just

6 recall seeing emails someplace where I discussed Coquina

7 11.

8 Q Do you recall if the circumstances for these

9 emails was that you had somehow -- that the balance that

10 was reflected on the fake TD Bank website was incorrect?

11 A From looking at this, it was over by

12 $6 million, which is a -- it's not something you want to

13 be doing in the middle of a Ponzi scheme is be off by

14 $6 million; although, if you check all our email

15 traffic, it's one of the ways you can tell who was

16 innocent and who was not. We were way off on some of

17 them, and some people questioned it voraciously and some

18 people did not.

19 Q And when you say that's how you can tell who

20 was innocent and who was not, what did you mean?

21 A Can I answer it by example?

22 Q Mhm-mhm.

23 A If you look at the email traffic back and

24 forth between Mr. Preve and I, there were frequent --

25 there were frequent --


Page 2123

1 Q It's contagious.

2 A I know.

3 There were frequent occurrences where the

4 balances were off and you can see him sending me emails,

5 not going "if you have this money locked in a trust

6 account, where is our money." It's him saying, "you

7 need to correct these balances. You need to have Irene

8 correct these balances. This is off by a millions of

9 dollars." One time I remember him saying something was

10 off by almost a billion dollars in one account alone.

11 Other people, okay, when a balance was off --

12 and I don't recall anyone specifically; but I do recall,

13 for example, the hedge funds even where accounts had too

14 much money in them, raising that -- raising a -- some

15 sort of flag to them and then saying something to me

16 about it and saying something to Mr. Preve and Mr.

17 Szafranski about it and questioning it.

18 So it was -- and it was -- it sounded like a

19 legitimate investor questioning the account balance, and

20 that's the way I differentiate, if that helps.

21 Q Do you recall how you found out that you

22 needed to add -- that someone needed to add 6 million

23 urgently?

24 A I do.

25 Q Can you tell me that?


Page 2124

1 A I looked at the balance.

2 Q And compared it to something; is that correct,

3 or did someone --

4 A I can only give you the normal process. I

5 can't tell you what I was doing at that moment, I would

6 be guessing.

7 Q Okay. Give me the normal process.

8 A Before an investor would come in to see the

9 bank balances, I would contact -- depending upon who was

10 keeping the balances -- either Mr. Preve,

11 Mr. Szafranski, Irene or Deb, get the correct balance,

12 check the fake website, make sure it matched; if it

13 didn't match, have someone correct it.

14 Q You have been asked about your preparation

15 numerous times for this deposition, as well as who you

16 met with over the past couple of years. I have a couple

17 of very quick questions.

18 And you have testified that you have looked at

19 some deposition transcripts; is that correct?

20 ALL PRESENT: Objection.

21 A I have reviewed certain pieces of certain

22 transcripts.

23 BY MS. EVANS:

24 Q Have you reviewed any of Debra Villegas

25 deposition transcripts?


Page 2125

1 A No, ma'am.

2 Q Any of Curtis Renie's deposition transcripts?

3 A No, ma'am.

4 Q Have you reviewed any of Steven Caputi's

5 deposition transcripts?

6 A No, ma'am.

7 Q Have you reviewed deposition transcripts of

8 any investors?

9 A I recall seeing a piece of Ari Glass's

10 testimony. I recall seeing a piece of Marc Nordlicht's

11 testimony. I recall seeing a small piece -- it seemed

12 to be scattered in documents I have -- of Kathleen

13 White's testimony.

14 I recall seeing part of Chris Podaras's

15 testimony -- no, no, not Chris Podaras, of Michael

16 Legamaro's testimony.

17 I don't recall reviewing any of the testimony

18 of investors.

19 Q Do you recall whether you reviewed any

20 testimony of Mr. Damson or Mr. Klein's deposition

21 testimony?

22 A I have not.

23 Q Okay. Did you review any trial testimony of

24 Ms. White or Mr. Damson and Mr. Klein?

25 A I reviewed no trial testimony at all.


Page 2126

1 Q All right. Have you spoken or met with

2 counsel of Ms. Villegas?

3 A No, ma'am.

4 Q Or counsel for Mr. Renie?

5 A No, ma'am.

6 Q Or counsel for Mr. Boockvor?

7 A When you say met with them, you mean post

8 Ponzi explosion, right, not that I may have met these

9 people at some point in time before --

10 Q Post Ponzi.

11 A -- because I knew a lot of lawyers in the

12 community.

13 Q Yes.

14 A Okay.

15 Q I'm not asking for any content. I'm just

16 asking did you meet with them.

17 A No. I haven't met with anyone, other lawyers,

18 other than my own and the trustee lawyers and the

19 government lawyers.

20 Q So you haven't met with Mr. Scherer or his --

21 anyone at his firm?

22 A No, ma'am.

23 Q Okay. At any point since the implosion of

24 your scheme?

25 A No, ma'am.


Page 2127

1 Q And the same for Mr. Tropin's firm, did you

2 meet anyone at his firm, either, after the implosion?

3 A Actually, I just met Mr. Tropin for the very

4 first time yesterday.

5 Q Okay. And same goes for his firm, you haven't

6 met with anyone there?

7 A No, ma'am.

8 MS. EVANS: Okay. Give me two seconds,

9 please. Let me make sure that I've asked you

10 everything that I wanted to.

11 FURTHER DIRECT EXAMINATION

12 BY MR. SCHNAPP:

13 Q Good morning, Mr. Rothstein.

14 A Good morning again.

15 Q Thank you.

16 I have a few questions. Let me focus on what

17 you had said before about sometimes people would have

18 the wrong amounts in their accounts and somehow from

19 that you could tell whether or not they were involved in

20 the Ponzi?

21 A I didn't say they had the wrong amounts in the

22 account. I said the documents reflected the wrong

23 amounts.

24 Q Okay. So let me clarify that.

25 There were occasions when people received


Page 2128

1 statements that reflected the wrong amounts, other than

2 what they should have expected to see in those accounts,

3 correct?

4 A No. You're not saying that right. It's

5 not --

6 Q You explain.

7 A It's not that they received statements. It's

8 that balance amounts that had been verified were

9 incorrect.

10 Q Okay.

11 A I don't recall -- I mean, it may have happened

12 that they got an incorrect statement, but I don't recall

13 that happening.

14 Q But do you recall a period of time when

15 Coquina wanted to consolidate the money that was in

16 your -- it their segregated account and in your general

17 account?

18 A I do, sir.

19 Q And you recall that they actually asked you to

20 combine the money that was set aside for them in your

21 general trust account with the money in the so-called

22 segregated account?

23 A I recall that.

24 Q And do you recall, sir, when did you that that

25 the -- the information that was given to them by your


Page 2129

1 firm as to the total funds in the segregated account was

2 $3 million too high?

3 A I do recall that.

4 Q And you also recall that the Coquina group did

5 nothing to advise you of that?

6 A That I don't recall.

7 Q Do you recall Mr. Szafranski actually telling

8 the Coquina people that was a good problem to have?

9 A I do recall that.

10 Q And did the Coquina people give you back the

11 $3 million in excess? In other words, their statement

12 that they were seeing showed that they had $3 million

13 more in their segregated account than there should have

14 been?

15 A No, I am sorry, Mr. Schnapp. You're

16 misunderstanding.

17 Q Okay. When the two accounts were

18 consolidated, isn't it a fact, sir, that the combined

19 amount in the segregated account was approximately

20 $43 million?

21 A I remember this occurring around -- I remember

22 discussing it with Mr. Damson.

23 Q And was there ever a time when Mr. Damson sent

24 the money back?

25 A No, no, no. I just said I discussed it with


Page 2130

1 Mr. Damson.

2 Q And what did he say and what did you do --

3 what did you say?

4 A He asked why the balance in the account was

5 off, it's too much money.

6 And I said, I had a general propensity to

7 leave my attorneys fees and costs from time to time, or

8 part of it, in the accounts. That is something I told

9 many of our investors when the balances were too high.

10 Q So you let him keep the additional 3 million;

11 is that right?

12 A No, no, I didn't let him keep it.

13 Q Well, was there any documentation showing that

14 he was not going to receive the $43 million?

15 A Only me telling him that if it was over, it's

16 my attorneys fees and costs.

17 Q My question to you is, you do recall

18 Mr. Szafranski telling him that that's a good problem to

19 have?

20 A Yes. That's my joking around, yes.

21 Q Okay. And then what documentation was there,

22 if any, of an effort by Coquina to return your attorneys

23 fees that were in the account?

24 A First of all, you have to remember something,

25 they didn't have control of that account. So even if


Page 2131

1 there was really something -- how much money are we

2 talking about, 23 million?

3 Q Forty-three.

4 A -- $43 million in there, they couldn't have

5 returned it to me. I would have just taken it. I am

6 the one who had control over the account.

7 Q And did you ever provide a document to them

8 showing them that you took back the $3 million in

9 excess?

10 A I may have ultimately sent them a corrected

11 bank statement shoving the 3 million out.

12 Q Did Mr. Damson ever say, how could you make

13 such a mistake by putting an extra $3 million in our

14 account?

15 A No, no, because it wasn't a mistake; it was --

16 my explanation, always -- you have to understand I was

17 always fearful, throughout the course of the scheme, of

18 the balances. We always erred on the side of excess, or

19 tried to.

20 My explanation was, it's my money in there.

21 It's attorneys fees and costs. Don't worry about it.

22 I'll get it when I need it.

23 Q Well, didn't any investors express to you

24 concerns that maybe you were being sloppy in your

25 accounting?


Page 2132

1 A I'm certain that they did, but it was neither

2 your here nor there. If you look at the email traffic,

3 you'll see emails, for example, with the hedge funds,

4 people pointing out the same thing that Mr. Szafranski

5 did: It's better to have too much in the account than

6 too little.

7 Q Now, just so I understand, what -- when were

8 you talking about Mr. Preve, what -- was he trying to

9 make his records appear correct? I mean, could you

10 explain what you meant? When Mr. Preve -- let me

11 withdraw that. That was a bad question.

12 When Mr. Preve had conversations with you

13 about balances in his accounts not matching what should

14 have been in the accounts, what was he asking you to do?

15 A Correct the balances.

16 Q And was he suggesting that -- but he knew his

17 balances were false; is that right?

18 A Yes.

19 Q Okay.

20 A From the time that he knew the Ponzi scheme

21 was going on, he knew they were false.

22 Q Okay. Were you aware -- I think you testified

23 yesterday that the rates of returns got higher later in

24 the deal; is that right?

25 A Yes.


Page 2133

1 Q And was that to induce people to invest?

2 A Yes.

3 Q And was there ever a concern that the rates of

4 return were usurious under Florida law?

5 A Yes.

6 Q Had you ever discussed that potential for the

7 rates being usurious with Mr. Damson?

8 A Yes.

9 Q And did you -- and what did you say to

10 Mr. Damson about the rates being usurious?

11 A I showed him a fake opinion letter that David

12 Boden had prepared -- I don't remember who he said had

13 signed -- saying it wasn't usurious.

14 Q At that time, had you done the deal that had a

15 600 percent return annualized?

16 A I do not recall.

17 Q Wasn't -- isn't it a fact, sir, that every

18 deal with the Coquina Group was in excess of 90 percent

19 annualized?

20 A I do not recall.

21 Q And did Mr. Damson get a copy of that opinion?

22 A I showed it to him. I don't know if I left it

23 with him.

24 Q Did Mr. Damson ever question you as to how you

25 were able to get such high returns?


Page 2134

1 A Yes.

2 Q Did Mr. Damson ever say to you anything about

3 him attempting to determine whether or not --

4 independently of your opinion, whether or not --

5 COURT REPORTER: I'm sorry I didn't hear

6 you at the end, whether or not ...

7 BY MR. SCHNAPP:

8 Q Did Mr. Damson ever tell you that he,

9 Mr. Damson, was going to get a legal opinion as to the

10 rates of return and whether or not they were usurious?

11 A I recall him telling me that they reviewed

12 Mr. Boden's opinion letter. I don't know whether Mr.

13 Boden signed it or if he had one of our other attorneys

14 sign it; but he reviewed the letter, and he was

15 comfortable based upon the research that had been done.

16 Mr. Damson was not one to leave things to chance. He

17 was very thorough.

18 Q Did Mr. Damson -- well, then, why didn't

19 Mr. Damson receive a copy of the legal opinion from you?

20 A I didn't say that he didn't receive. You're

21 changing what my testimony was.

22 I said I don't remember whether he took a copy

23 with him or not. I remember showing it to him.

24 Q Do you know that the trustee sent a demand

25 letter to Coquina suggesting that -- the rates of


Page 2135

1 returns that are received on every deal is usurious?

2 A I heard that from for first time yesterday.


4 Q Do you know that the trustee threatened to sue

5 Coquina for criminal usury?

6 A That I just found out when you just said it.

7 Q Sir, were you ever given any immunity with

8 respect to usury from the state -- from the state in

9 connection with the state -- any state prosecution?

10 A I'm sorry. Say that again.

11 Q Were you given any immunity with respect to

12 usury in connection with any state or federal

13 prosecution?

14 A To my knowledge, no.

15 Q Now, I'm going to go through one other area

16 just quickly.

17 You had talked the other day about that

18 certain times there would be kickbacks to certain

19 people; is that correct?

20 A Yes.

21 Q And isn't -- your -- and you said there was

22 kickbacks to Mr. Szafranski; is that true?

23 A You have to define "kickbacks" for me.

24 Q Well, when you used the term "kickbacks," what

25 did you mean?


Page 2136

1 A Well, I use it broadly. There are kickbacks

2 that I -- understanding that nothing that was going on

3 was legitimate. There are kickbacks that I would craft

4 in a manner to look as if they were legitimate; and then

5 there were just blatantly illegal kickbacks that's were

6 illegal and looked illegal.

7 Q By the way, to you knowledge, were the deals

8 that you were making usurious?

9 A Yes.

10 Q And the deals that you made, that would

11 include the deals with Coquina; they were usurious?

12 MR. SCHERER: Objection, form.

13 BY MR. SCHNAPP:

14 Q Is that correct?

15 A They looked usurious to me. I never actually

16 did the research.

17 Q Okay. Let me show you what I am marking as

18 Exhibit 246.



21 BY MR. SCHNAPP:

22 Q Just let me help you a little bit.

23 Looking at the bottom of the page, there's an

24 email from you to Mr. Szafranski, and you say, "and I am

25 going to give you 50 percent of my fee for each one you


Page 2137

1 move."

2 What were you referring to there?

3 A First of all, it says "50K" not "50 percent."

4 Q I'm sorry, you're right, 50K, that is 50,000,

5 right?

6 A That was my Ponzi-speak with Mike explaining

7 to him how much he was going to make for every deal he

8 got.

9 Q Why were you paying Mr. Szafranski if he was

10 acting as the agent for the funds for Coquina?

11 A Because he was in on the Ponzi scheme.

12 Q All right. So that -- was it fair to say that

13 was kickback?


15 A It's what I would term one of the kickbacks

16 that was illegal and looked illegal. Okay. There's a

17 difference.

18 There are some that I gave that I crafted to

19 look legitimate, and then there were some with Mike, who

20 was in on it, that I couldn't have cared less what it

21 actually looked like.

22 Q Okay. Did Mr. Szafranski ever tell Mr. Damson

23 that you were kicking back part of your fee?

24 A He may. I don't know. Ask Mr. Szafranski is

25 the best way to do that.


Page 2138

1 Q Well, I want to ask you. Let me show you 247.



4 BY MR. SCHNAPP:

5 Q Do you see -- you see the internal email?

6 A Yes.

7 Q And it says he, meaning you, is kicking back

8 fees?

9 A Yes.

10 Q Why would Mr. Szafranski be telling a funder

11 that you were kicking back money?

12 A He says, he has negotiated with the other

13 lawyers to send him 20K of their fee. He is kicking

14 back to funders if they fund five cases or more, any

15 interest. He is utilizing that as a lure to lure

16 Mr. Damson in to invest more money with us.

17 Q By using the word "kicking back"?

18 A Kicking it back, he's referring to the money

19 that he was getting from the lawyer. He is saying that:

20 I'm getting money from the other lawyer, and I'm willing

21 to -- if you take a certain number of cases, to give it

22 to someone else.

23 Q Let me show you what I'm going to mark as

24 Exhibit 248.



Page 2139


2 BY MR. SCHNAPP:

3 Q Do you see, again, the reference to kicking

4 back fees?

5 MR. NURIK: Is this an eye test?

6 MR. SCHNAPP: Your eyes are better than

7 mine.

8 MR. SCHERER: Can you identify that for

9 us, so we know what we are looking at?

10 BY MR. SCHNAPP:

11 Q Mr. Rothstein, why don't you identified what

12 that is.

13 A It an email from Michael Szafranski dated

14 Monday August 10th, 2009, at 10:56 a.m, to me; subject,

15 Coquina; first line, it says "five cases."

16 Okay. So your question is, Mr. Schnapp.

17 Q Was that another example of kickback?

18 A It is a discussion between Mike and I about

19 using kickbacks to lure in investors, yes.

20 Q And in this case it was Coquina?

21 A Yes.

22 Q And what are the letters that Barry Damson is

23 trying to obtain?


25 BY MR. SCHNAPP:


Page 2140

1 Q As you read that email, what does that mean to

2 you?


4 A To the best of my recollection, it involved

5 fake opinion letters that I had. He did not know they

6 were fake, but he was asking for letters from me. He

7 asked for opinions on certain things.

8 BY MR. SCHNAPP:

9 Q And did you give them -- did you give him

10 copies of those fake opinions?

11 A I don't recall one way or the other. You have

12 to check the email traffic.

13 Q Did you ever tell Mr. Szafranski that he could

14 communicate to Mr. Levin that he was going to get an

15 extra 300,000 from your fees?

16 A I don't recall one way or the other. If you

17 have an email, it might refresh my recollection. It

18 would be helpful.

19 Q I'm going to mark as Exhibit 249 an email

20 chain, but I would ask you to look at only the first

21 page.



24 BY MR. SCHNAPP:

25 Q Can you identify that for the record, sir?


Page 2141

1 A Yes.

2 Q And were you giving --

3 MR. SCHERER: Tell us what it is, please,

4 so we --

5 A Yes. It's an email from Scott Rothstein,

6 dated Wednesday July 15, 2009, at 2:47 p.m., to Mike at

7 Onyx Capital Management dot com; subject, re: new deals.

8 Q Were you giving Mr. Levin additional money

9 from your fees?

10 A No. No. That's not what this is about.

11 Q What is it about?

12 A This is me telling Mike that before I send

13 these new deals to Mr. Levin, try telling people that

14 I'll give them an extra $300,000 out of my fees if they

15 take six deals. It's not the money to Mr. Levin.

16 Q Okay. So but you -- but this was evidence of

17 the fact that you were going to kick back money from

18 your own fees --

19 A Yes.

20 Q -- to any --

21 A Obviously, there is no real fees, so it's a --

22 Q I understand. This was an inducement to get

23 people to go into the deals.

24 A Correct.

25 Q That you, as the lawyer for the people who are


Page 2142

1 is settling these cases, was going to kick back

2 $300,000?

3 A Out of my fees.

4 MR. SCHNAPP: I just need one moments. I

5 just need two minutes, and I'll be ready.

6 BY MR. SCHNAPP:

7 Q Yesterday I asked you some questions about the

8 funds; do you recall?

9 A I'm sorry?

10 Q I asked you some questions about the funds,

11 and when I said "funds," I'm talking about Platinum and

12 Centurion.

13 Let me just show you what I'm going to mark as

14 Exhibit 250.



17 BY MR. SCHNAPP:

18 Q That's an email from Mr. Preve to

19 Mr. Nordlicht on the top.

20 A If you give me a second, I'll read it, and

21 I'll be right with you.

22 UNKNOWN SPEAKER: What is the date of the

23 email?

24 MR. SCHNAPP: June 15, I'm sorry,

25 June 23.


Page 2143

1 THE WITNESS: No. No. The email is June

2 25th at the top and June 24 at the bottom.

3 MR. SCHERER: In '09?

4 THE WITNESS: Yes.

5 The bottom is from Mr. Preve to

6 Mr. Nordlicht, June 24th, 2009 at 8:59 a.m,

7 The top is June 25th, 2009, 12:36 p.m., from

8 Preve to Mr. Lichtman and Mr. Simony.

9 Just give me one second, and I'll read

10 this.

11 BY MR. SCHNAPP:

12 Q Was there ever any discussions about -- that

13 you were privy to, that if Mr. Nordlicht made a false

14 representation to new investors, he would be able to get

15 himself bought out?

16 A Yes.

17 Q And is that what this is referring to?

18 A Yes.

19 Q Can you elaborate on that?

20 A Yes.

21 Q Well, could you do it now?

22 A Oh, yeah, I'm sorry.

23 My apologies, I'm sorry about that,

24 Mr. Schnapp.

25 Q It's good deposition training.


Page 2144

1 If you could, just explain to me what that

2 means.

3 A Yes. Frank and I, on several occasions,

4 discussed the fact that we needed a positive credit

5 reference with regard to incoming investors. We needed

6 a positive credit reference from the hedge funds in New

7 York.

8 The reason being that if they said we were in

9 default or said we weren't a good investment strategy,

10 it would likely cut off our ability to bring in new

11 funds.

12 The way we put this out for the purpose of the

13 hedge funds was that we'll be getting new money in. We

14 can out utilize that money to pay you. It will speed up

15 the process of them getting all their money out, so we

16 wanted them to lie for us. These emails reflect those

17 conversations with Mr. Nordlicht and Mr. Simony.

18 Prior to the new investors inquiring of

19 Mr. Nordlicht, Mr. Nordlicht and I had a conversation,

20 one or two over the phone and at least one in my office,

21 where I explained to him the concept that I previously

22 referred to as DOMAD, the doctrine of mutually assured

23 destruction, and told him that it benefited no one to

24 say we were in default; that the best thing he could do

25 to get his money out, and for us to not have this


Page 2145

1 explode, would be to give us a positive credit rating,

2 and that's what occurred.

3 Q Okay. So you were -- you had discussed with

4 Mr. Nordlicht the fact that Mr. Nordlicht last going to

5 lie to new investors, correct?

6 A Yes, and I actually discussed it with

7 Mr. Simony, as well.

8 Q Okay. They agreed to that?

9 A They did.

10 Q When you set up the segregated account for

11 Coquina, were they still relying on Mr. Szafranski to

12 look at the account?

13 A You mean the fake segregated account?

14 Q The fake segregated account?

15 A Yes.

16 Q And why didn't -- why didn't they ask to have

17 copies of the fake segregated account -- let me

18 rephrase.

19 Why didn't Coquina, or did Coquina ever ask

20 you to have copies of the statements from the segregated

21 account sent directly to them from the bank?

22 A Sent directly to them from the bank?

23 Q Yes.

24 A I don't recall them ever requesting that.

25 Q And at that point, the segregated account, so


Page 2146

1 we're clear, was only supposed to have Coquina's monies

2 in it; is that correct?

3 A Yes.

4 Q And they never asked to get a copy of that

5 statement sent directly to them from TD Bank?

6 A Directly from TD Bank, no.

7 MR. SCHNAPP: Mr. Rabin, are you up --

8 MR. RABIN: Yes.

9 MR. SCHNAPP: -- next?


11 BY MR. RABIN:

12 Q Good morning, again, Mr. Rothstein.

13 MR. NURIK: Before we begin, can I ask a

14 question?

15 MR. RABIN: Sure.

16 MR. NURIK: Being that you have asked

17 questions before --

18 MR. RABIN: Yes.

19 MR. NURIK: -- is it your intent to ask

20 questions on matters that you have already

21 asked?

22 MR. RABIN: Absolutely not, I don't want

23 to be repetitive. I'm -- in fact, if I cover

24 an area that's been covered before, it's going

25 to be to add something new; it's not to cover


Page 2147

1 things that we have already covered for sure.

2 Okay?

3 MR. NURIK: Okay.

4 BY MR. RABIN:

5 Q Let me start first with, we spoke previously a

6 little bit about Melissa Lewis or Britt. How do you

7 know her? How did you refer to her, as Melissa Britt or

8 Lewis?

9 A I referred to her to as Melissa Lewis.

10 Q Prior to her death, did you have any kind of a

11 physical relationship with her at any time while she

12 was -- while you knew her?

13 A Yes.

14 Q Okay. When did that occur in relationship to

15 her death, that is how soon before?

16 A Many years before.

17 Q Okay. After she was murdered, did you do

18 anything to influence the investigation by law

19 enforcement of her death?

20 A No.

21 Q Did you have anybody from law enforcement

22 feeding you information about the investigation as it

23 was going on?

24 A Yes.

25 Q Were you paying for that?


Page 2148

1 MS. STONE: Objection, privileged.

2 BY MR. RABIN:

3 Q All right. Was she married at the time that

4 you were having the relationship with her?

5 A No. She was a student of mine.

6 Q Okay. Do you know if her -- the person who

7 became to be known as her -- or became her husband ever

8 knew about that relationship?

9 A I do not know.

10 Q Okay. Let me move on to -- do you remember --

11 I think you previously testified that after you had fled

12 to Morocco, that you didn't use email very much, but you

13 used your phone; is that correct?


15 A I think I used text messages more than I used

16 email, I believe.

17 BY MR. RABIN:

18 Q I want to -- I have the text of a message that

19 I want to see if you recall.

20 A Sure.

21 Q Would you prefer me to read it into the

22 record, or would you like to read it yourself? I'll

23 give you your preference?

24 A It would probably be easier if I read it.

25 Q Okay. Let me show it to you, just to refresh


Page 2149

1 your recollection.

2 A Okay.

3 Q Okay. First of all, does that appear to be a

4 text message that you sent?

5 A It does.

6 Q Okay. And so that everybody knows what we are

7 talking about, why don't you read the contents of it

8 into the record, so that everybody kind of knows where

9 we are going.

10 A Sure, Mr. Rabin.

11 George and Frank, I have completed a list of

12 info you will need to go after TD Bank and Gibraltar

13 Bank. We should meet late Tuesday or first thing

14 Wednesday. We will have to select the time and place at

15 random just before we meet. I am in much greater danger

16 than simply dealing with these issues. My life and the

17 lives of my parents, sister, kids and wife are all in

18 jeopardy. Please watch out for yourselves. Despite my

19 idiocy, I love you both. Scott.

20 Q All right. So first of all, you recognize

21 that to be a legitimate text that you sent?

22 A When you say "legitimate," it contains lies,

23 but it's a -- yes, it's -- I think what you are getting

24 at Mr. Rabin: Is it a text that I sent.

25 It looks like something that I sent, yes.


Page 2150

1 Q That was an in artful question. That's

2 exactly what I was asking.

3 Is it a text that you sent?

4 A It is authentic.

5 Q Now let's take it apart.

6 It talks about you claiming to have completed

7 a list of info that you -- and the "you" is George an

8 Frank in the context of this text massage -- will need

9 to go after TD Bank and Gibralter Bank.

10 Was that true?

11 A No.

12 Q Okay. So you did not prepare any such list?

13 A No. I was still in Morocco at the time this

14 was written, and I -- I didn't prepare any lists for

15 anybody. I was in a sheer state of panic.

16 Q And by the way, on this date, November 1st,

17 had you already spoken to Marc Nurik about -- and

18 retained him?

19 A Yes.

20 Q Okay. Do you remember what date that

21 occurred, in relationship to -- the date you left for

22 Morocco was October 28th; is that right?

23 A I left for Morocco the 27th or 28th. I don't

24 recall specifically.

25 Q All right. Do you remember how many days


Page 2151

1 after you left for Morocco, you retained Mr. Nurik, or

2 reached out to him, at least, to be your lawyer?

3 A I first reached out to him -- I was there a

4 very short period of time, maybe a day.

5 Q So if you left the 27th or 28th, we are

6 talking about the 28th or 29th you would have reached

7 out to him?

8 A That sounds about right.

9 Q All right. And so, now you've already talked

10 to Mr. Nurik at the time you had sent --

11 A I'm sorry.

12 Q Don't let me interrupt you two.

13 A He actually was giggling about the fact that

14 we needed to define "retained."

15 Q Well, I understand that.

16 A I think he was talking about my pecunious

17 status.

18 Q That's probably a contention that you and

19 Mr. Nurik can deal with in terms of how well you have

20 compensated him or the lack thereof.

21 But in any event, so the fact that you

22 prepared a list to go after TD Bank and Gibralter was a

23 lie?

24 A Yes.

25 Q What was the purpose of that lie?


Page 2152

1 A At the time that all this was going on,

2 Mr. Rabin, I was just trying to keep everything calm,

3 not have people go running around to the police, not

4 have people do anything foolish. And I was trying to

5 make people believe that I was still on board, that I

6 was still a team player, that type of thing.

7 Q All right. Were you no longer on board and no

8 longer a team player?

9 A I don't know where I was. I mean, I was --

10 you know.

11 Q Well, were you still contemplating suicide

12 after you had the benefit of Mr. Nurik's counsel?

13 A I actually contemplated suicide right up until

14 the time I left Morocco.

15 Q Okay. So you didn't find sufficient solace in

16 the fact that you had retained Mr. Nurik to prevent you

17 from continuing to think about committing suicide?

18 A No reflection on Mr. Nurik; but yes, he did

19 not talk me off the ledge.

20 Q Okay. Well, somebody did because you didn't

21 kill yourself?

22 A I did.

23 Q Okay. So you kind of came to -- you came to

24 that realization of your own, not to kill yourself?

25 A I decided to be a man, probably for the first


Page 2153

1 time in my life.

2 Q Okay. Going on with this text message, you

3 say, I am in much greater danger than simply dealing

4 with these issues.

5 What did you mean by that?

6 A That was a lie.

7 Q Okay. My life and the lives of my parents,

8 sister, kids and wife are all in jeopardy?

9 A That was a lie to get them to try to protect

10 my -- to look out for -- not go after my family.

11 Q Please watch out for yourselves. Despite my

12 idiocy, I love you both.

13 True statement or false statement?

14 A Please watch out for yourselves?

15 Q Yes.

16 A I didn't really think they had anything to

17 worry about, other than crimes that they committed,

18 but -- at least what Mr. Preve had done.

19 Q So that it was also a lie?

20 A If you say "please watch out for yourselves,"

21 yes. If you are taking it in the context of everything

22 else I was saying, yes.

23 "Despite my idiocy, I love you both," No, I

24 did care about both of them.

25 Q Okay.


Page 2154

1 A Still do.

2 Q But so it's fair to say that for the most

3 part, this text message is almost a total lie?

4 A Yes, sir.

5 Q Okay. Now I want to show you what's going to

6 be marked as Exhibit No. 251?

7 MR. LICHTMAN: Was that last text message

8 marked as an exhibit?

9 MR. RABIN: It is not.

10 MR. LICHTMAN: I think it should be.

11 MR. SCHERER: Yes, I do, too.

12 MR. RABIN: I'll supplement the record,

13 then, because I have it as a group of other

14 texts. I'll supplement and mark them.

15 MR. LICHTMAN: But we're supposed to be

16 marking being them, you know, concurrently.

17 MR. SCHERER: Is that 251?

18 MR. RABIN: We'll make it 251.

19 MR. LICHTMAN: Thank you.

20 (Thereupon, the document was marked as

21 Spinosa's Exhibit 251 for Identification.)

22 MR. RABIN: And 251, so the record is

23 clear, then, will have a second message on

24 it -- actually, no, that's the wrong page.

25 Yeah, it is by itself.


Page 2155

1 Okay. So 251, and I'll supplement a copy

2 of -- it will be a text massage on the other

3 page.

4 BY MR. RABIN:

5 Q Let me show you 252. Its an email. This has

6 been previously produced. It's TD/Razor OOOO58.

7 Let me know when you're done reviewing that,

8 please.



11 A Okay.

12 Q Do you remember this email?

13 A Vaguely.

14 Q Okay. Fair to say that the text of this email

15 is Frank Spinosa soliciting business from you?

16 A Yes.

17 Q Okay. Is there any Ponzi-speak in this email?

18 A No.

19 Q Is there any -- is there anything in this

20 email that you consider to be flowing as a result of

21 Frank being a player or on your team or having received

22 money from you?

23 A No.

24 Q Okay. Would be fair to characterize this

25 email, then, as a banker seeking to obtain information


Page 2156

1 or seeking to obtain business, specifically loan

2 business, from a client?

3 A Yes.

4 Q Okay. And were there many occasions where

5 Frank Spinosa solicited or tried to solicit business

6 from you?

7 A I believe he did, yes.

8 Q And were there also many occasions where Frank

9 Spinosa solicited from you business contacts to obtain

10 information -- to obtain business from your friends and

11 associates?

12 A Yes.

13 Q Okay. Was that a frequent theme with you, the

14 two of you?

15 A Yes.

16 Q Okay. Can you, off the top of your head,

17 recall any people or organizations that Mr. Spinosa was

18 soliciting you to make a connection for him?

19 A He wanted to meet all my wealthy friends and

20 business owners.

21 Q Okay. Would you consider that would be the --

22 one of the functions of a banker?

23 A Yes.

24 Q Okay. You found nothing unusual about that?

25 A Not in the least.


Page 2157

1 Q Okay. Regarding the people -- do you have an

2 independent recollection of specifics that he -- where

3 he asked you to make an introduction for him?

4 A I don't specifically.

5 Q Okay. Let me ask -- let me see if I can

6 refresh your recollection on some.

7 A Great.

8 Q Did you have an connection with the Seminole

9 tribe?

10 A I did.

11 Q Did he ask you to make a connection there?

12 A He certainly may have.

13 Q All right.

14 A Several different bankers did.

15 Q Let me show you a document and mark it 253 and

16 see if this refreshes your recollection?

17 MR. SCHLESINGER: These are was from the

18 restored emails that were produces to us last

19 week.



22 A I recall this.

23 BY MR. RABIN:

24 Q All right. What was your connection to the

25 Seminole tribe?


Page 2158

1 A I had a friend who was very close to some of

2 the leaders of the tribe.

3 Q And so is it fair to say that Mr. Spinosa

4 somehow knew about that and was seeking your ability to

5 make an introduction for him so he could obtain business

6 from the Seminoles?

7 A Yes.

8 Q Do you know how he came to know that you knew

9 somebody at the Seminole tribe?

10 A I told him.

11 Q Okay. How about at the Versace mansion, did

12 he also try and get business there?

13 A I had offered that to him, yes.

14 Q Okay. Bova, the restaurant, did he try and

15 get that business?

16 A Yes, Mr. Rabin, I offered him access to all my

17 businesses.

18 Q And was that -- in his function as a banker,

19 did you consider that to be a legitimate business or was

20 that Ponzi business.

21 A It was both.

22 Q Tell me how it was Ponzi business?

23 A I was trying -- the best way to put it is

24 this: The way I operated was with people that were

25 being good to me, assisting me with the scam, I tried to


Page 2159

1 do everything I could to make them look good in their

2 legitimate businesses.

3 So, unfortunately, very little of my life

4 during that point in time was unrelated to Ponzi.

5 Everything that I was doing was pretty much geared

6 towards keeping this thing alive and preventing myself

7 from going to jail, if that helps clear it up at all.

8 Q If you were to remove the -- all of the

9 illegal things that you were doing from the equation for

10 a moment -- and I know that's probably impossible to do,

11 but assume that for the sake of the question -- would

12 the actions and conversations that Frank Spinosa

13 undertook to obtain business connections from you be

14 consistent with that of a legitimate banker doing

15 legitimate banking work?

16 A From what you have just shown me, yes.

17 Q Okay. Let me show you what I am going to mark

18 as Rothstein 254.

19 Honestly, I'm not sure if this has been

20 provided or not. I have copies of it.

21 MR. SCHLESINGER: Yes, it was produced

22 already.

23 MR. RABIN: It was okay.

24 MR. SCHLESINGER: It's the email from

25 Frank Spinosa to Scott Rothstein: I think it


Page 2160

1 was about three years ago I meet you and

2 committed the best service --

3 MR. RABIN: Hang on. I think that's a

4 different one.

5 (Court reporter interruption.)



8 BY MR. RABIN:

9 Q You've have reviewed the email?

10 A I have.

11 Q Okay. This email occurs after you have

12 requested a letter from Mr. Spinosa?

13 A It's one of the lock letters.

14 Q Okay. And it occurs -- his email back to you

15 is after you have requested one of the letters?

16 A Yes. The traffic appears to be the -- part of

17 the email is cut off.

18 MR. SCHERER: Can we get the date on

19 that?

20 THE WITNESS: You want to do it,

21 Mr. Rabin?

22 MR. RABIN: You can.

23 THE WITNESS: Frank A. Spinosa to Scott

24 Rothstein, Thursday, September 17th, 2009, at

25 5:10 p.m.; with two prior emails on the bottom


Page 2161

1 of it, same date.

2 BY MR. RABIN:

3 Q All right. And Frank Spinosa says on the top

4 of it: I think it was about three years ago I met you

5 and committed the best service you will ever have and

6 that I would become your banker. We are well on our

7 way. I am proud to know you and be there for you.

8 A Yes.

9 Q Is there any Ponzi-speak in there?

10 A Yes.

11 Q Okay. Tell us what you consider to be

12 Ponzi-speak in there.

13 A You have to take it from the very bottom. The

14 bottom of the email, the 9/17/2009, 4:47 p.m. email, is

15 cut off; but it says the subject, "the letter," and that

16 would have been a lock letter I was asking him to sign

17 for us.

18 Q Right.

19 A Okay.

20 Q He responds to me, "he'll be back in office

21 the first thing tomorrow morning. He's going to get it

22 out to me."

23 As you know from my prior testimony, that is a

24 lock letter that actually does nothing that I was

25 utilizing to lure in investors.


Page 2162

1 I say: Thanks so much Frank, U R Da Man.

2 And then he responds with this very nice,

3 professional email.

4 But given the fact that it's in response to

5 something that was illegal that we were doing, I take it

6 as Ponzi-speak.

7 But I will tell you this: Mr. Spinosa was

8 always extremely professional in everything that he

9 drafted.

10 (Court reporter interruption.)

11 (Thereupon, a recess was taken.)

12 BY MR. RABIN:

13 Q All right. And in the context of this letter,

14 did you believe that Frank Spinosa was trying to provide

15 you with good service?

16 A Yes.

17 Q Okay. As a banker?

18 A As a banker, and in assisting me in what I was

19 doing, to the limited extent that he was involved, yes.

20 Q All right. Let's go -- regarding these

21 letters that you just mentioned, we have gone through

22 them, and I'm not going to cover the same ground; but

23 did you ever request a letter on an account that wasn't

24 one of your trust accounts?

25 A A lock letter?


Page 2163

1 Q Yeah.

2 A I don't recall ever requesting one on anything

3 that was not associated with the Ponzi scheme. It may

4 not have been a trust account, but to my recollection, I

5 always used it regarding some type of fraud.

6 Q Well, is it fair to say that on all the

7 letters that you -- first of all, so we're clear, all

8 the letters that Frank Spinosa authored, you requested

9 of him, correct?

10 A Yes, sir.

11 Q And the so-called lock letters, you requested

12 them all?

13 A I did.

14 Q And they were all on your trust accounts,

15 correct?

16 A I don't know that for certain. I may have had

17 Ponzi accounts or Ponzi- or criminal-related accounts

18 that were not trust accounts that I wanted to give the

19 appearance of being locked.

20 Q Do you remember an incident where you or

21 somebody on your behalf requested a lock letter, as you

22 called them, on an account that was not a trust account;

23 it was an LLC account, and the bank and Mr. Spinosa

24 refused to give it to you?

25 Do you remember that?


Page 2164

1 A I don't. You'd have to -- you'd have to show

2 me the email traffic to tell you that.

3 Certainly possible.

4 Q Okay. And you don't -- do you have an

5 independent recollection of ever requesting a letter and

6 not being provided with one?

7 A I don't remember one way or the other.

8 Q Let me show you what I'm going to mark as 255.

9 It's already been produced. It's a letter.

10 MR. SCHLESINGER: Bates stamped TD/Razor

11 002505.



14 MR. RABIN: And it's Kerstetter to Regulo

15 Araulo.

16 I'm sure I butchered his name.

17 THE WITNESS: Sorry. Marc just broke my

18 leg.

19 MR. RABIN: Tell me when you're ready.

20 THE WITNESS: Just give me one second.

21 MR. RABIN: Sure.

22 THE WITNESS: You should have another

23 email that goes with this, but I remember this

24 specifically, yes.

25


Page 2165

1 BY MR. RABIN:

2 Q Okay. I don't, unfortunately.

3 So the fact that it refreshes your

4 recollection, tell us what you recall about it, please.

5 A Yeah. What was happening was, one of the

6 legitimate investors, the Von Allmen group, the D3

7 Capital group, were looking to duplicate what I was

8 doing. Okay. I had this whole illegal lock-letter

9 thing going on with Mr. Spinosa where things looked like

10 they were locked but they weren't really locking

11 anything.

12 Mr. Preve knew that we were doing that.

13 Mr. Preve spoke to the people at the D3

14 Capital, Mr. Scherer's clients, okay, and described how

15 we were able to lock these accounts. Okay. He was

16 using it as part of his sales pitch. Okay.

17 Someone at D3, one of the lawyers or one of

18 the -- one of the due diligence people, I think it might

19 have been Chris Podaras, got the idea that in this whole

20 thing that they were doing off to the side between

21 Banyan and them and whoever else they were dealing

22 with -- I remember it involved an LLC -- that they

23 wanted to have between themselves, not with one of my

24 accounts, that they wanted to have the account locked.

25 And since there was no real mechanism to do


Page 2166

1 that, since you couldn't really lock the account and

2 since Mr. Spinosa knew that these people were, quote,

3 unquote, legitimate investors, they couldn't do it.

4 Because if they had done it, it would have blown the

5 whole thing sky high because there was no way to lock

6 the account. Had he provided that, it would have been a

7 disaster for everybody, including him.

8 Q Do you remember Mr. Spinosa providing you with

9 a letter on any account, other than a trust account?


11 Q And do you remember him ever providing you

12 with a letter on one of your accounts where you had not

13 requested it beforehand?

14 MR. LICHTMAN: Objection to the form.

15 A No, sir.

16 BY MR. RABIN:

17 Q All right. There came a point in time -- you

18 testified about this before; it's the email there, and I

19 don't know what exhibit number it is. I could show it

20 to you if you need to refresh your memory about it

21 again, the email where Mr. Spinosa talks about getting a

22 standard proof letter?

23 A Yes. I recall that.

24 Q Okay. At this point, Mr. Spinosa has been

25 paid by you, correct?


Page 2167

1 A What's the date of that?

2 Q September 30th.

3 A Yes, sir.

4 Q Okay. Why would -- I mean, that's certainly

5 contrary to anything that would be going on with your

6 arrangement with him, for him to seek approval from

7 anybody at the bank, right?

8 A I spoke to Frank about that.

9 Do you want to show me the email again?

10 Q Sure. I'll mark it again. It's probably

11 already in the record, but it's easier for me to mark it

12 again than just to look for it.

13 This will be Exhibit 256.

14 MR. SCHLESINGER: Trustee/Spinosa 000197.



17 THE WITNESS: Okay.

18 BY MR. RABIN:

19 Q Okay. You said you spoke to Mr. Spinosa about

20 this?

21 A I did.

22 Q All right. Tell me about the conversation.

23 A When I read this, I took it as his Ponzi-speak

24 saying we needed to slow down on the lock letters, there

25 were too many in the system.


Page 2168

1 Q Okay. He's talking about getting an

2 approve -- a letter approved by somebody within the

3 bank, correct?

4 A Yes.

5 But if you think about what was going on, that

6 makes no sense. It's a way of telling me we need to

7 slow down, because think about this: From the very

8 beginning, Frank is signing lock letters that lock

9 nothing. He knows that I'm providing it to people who

10 are, at the very least, clients of mine. Okay.

11 It's not something that, from my conversations

12 with Mr. Spinosa, Mr. Spinosa wanted to continue to do

13 and certainly didn't want to continue to do it with the

14 frequency. It was his way of telling me to slow down.

15 Q You didn't, like, get into one of your rants

16 with him; I mean, you -- you sent back a very measured

17 email basically saying, I prefer not to use the standard

18 letter, almost done for the time being, right?

19 A I don't think I ever ranted at Frank Spinosa.

20 He was always a gentleman with me. But I did speak to

21 him about this and told him specifically that we'll do

22 it at whatever pace he needs it done.

23 Q You would agree with me that you -- the last

24 thing you would have wanted was for him to get a letter

25 approved within the bank, correct?


Page 2169

1 A I would tell you it was the last thing he

2 wanted to try to do because then the entire bank would

3 have been on notice that he was providing signed lock

4 letters that did nothing.

5 Q Did you --

6 A They accomplished nothing.

7 Q Do you know whether or not he had notified

8 other people within the bank that he had prepared these

9 letters?

10 A I believe he did.

11 Q Okay. So he wasn't keeping a secret from

12 people within the bank then, was he?

13 A I don't know who he told, but I believe he

14 discussed it at certain points in time. I believe

15 that's how he knew it could not be done.

16 Q Well, did you know that he had put notes on

17 some of the accounts regarding the letters?

18 A Yes, but the notes don't match what the

19 letters say. The notes are -- diverge from what the

20 lock letter says they would do. They accomplish

21 nothing. If you think about it, telling me that you're

22 locking an account that you know can't be locked, either

23 he's the dumbest banker in the world or he was

24 participating in a fraud, one or the other; and he's not

25 dumb at all.


Page 2170

1 Q Have you read any -- have you read the Enotes

2 put on the account?

3 A I recall reading some of them that I was

4 shown.

5 Q When? Who showed these to you?

6 A I don't recall.

7 Q And it's your testimony that they don't match

8 the letters?

9 A The ones that I was shown don't match the

10 letters.

11 Q In what way?

12 A One said we need to limit -- no. That if

13 someone tries to move the money, other than Scott, or

14 there is something going on with the account, let Scott

15 know.

16 I don't remember -- I do remember having a

17 conversation that came up after -- I think it was after

18 the -- somebody at the bank was questioning the fact

19 that this couldn't get done, and I remember talking to

20 Frank about it and saying, what happens if you actually

21 put the instruction on there, if you actually just put

22 it into the system, this money can only go to this

23 place?

24 He said, it will show up on the screens, he

25 said, but it still doesn't prevent you from moving the


Page 2171

1 money because you have wire capacity, so you can always

2 just move the money.

3 Q Did --

4 A So he may have, in fact, actually tried to put

5 a real instruction on there at some point in time, but

6 it would have had no effect because of TreasuryDirect

7 and our access.

8 And you also have to remember, just to finish

9 the answer, there was no money in the accounts.

10 Q So what you're saying is that regardless of

11 whether he put the instruction on it or not, you always

12 had the ability to move the money; is that what you're

13 saying?

14 A To my knowledge, yes.

15 Q Did Frank Spinosa know that you were stealing

16 money out of these accounts?

17 A I don't believe he knew I was -- I knew -- I

18 believe that he knew -- and this is my opinion: I

19 believe he knew I was committing a fraud, but I never

20 discussed with him the fact that I was stealing money

21 from these people.

22 As I testified many times earlier, I only told

23 people exactly with they needed to know. I only wanted

24 him to do two things -- three things: Watch out for any

25 problems within the bank regarding velocity of


Page 2172

1 transactions, money laundering, the PSA, AML warnings,

2 that kind of stuff; protect me on that and overdrafts.

3 I had him do the lock letters, and I had him verify some

4 false information to some clients.

5 Other than that, he did not participate in the

6 fraud.

7 Q Based upon the information you gave him and

8 the conversations you had with him, what was the fraud

9 that you led him to believe that you were committing?


11 Q Well, you just said that you didn't think that

12 he knew you were stealing from the accounts, you don't

13 think he knew about the Ponzi --

14 MR. LICHTMAN: Objection to form.

15 BY MR. RABIN:

16 Q -- but he knew about some kind of fraud.

17 So I'm assuming that would be based on your

18 conversations with him, correct?

19 A It's based upon what I told him and my

20 opinion.

21 Q Okay. In your opinion, what was the nature of

22 the fraud that you believe that he knew about?

23 A That I was attempting to utilize the banks to

24 commit criminal activities. I don't think he knew the

25 extent to which I was doing it.


Page 2173

1 Although, if you look at the shear amount of

2 money I'm moving in and out of the accounts and the

3 velocity, it appears to be money laundering.

4 Q And what criminal acts, specifically? Is

5 money laundering the one you're talking about?

6 A It's one of them.

7 Q What other criminal acts do you believe, based

8 upon your conversations with him and interaction with

9 him, that he would have believed you were committing,

10 what crimes?

11 A Convincing, what appear to be, my clients, for

12 whatever reason, that funds were in a locked account

13 when there was actually next to nothing in the account

14 and when they could not really be locked, and lying

15 about the amount of money that was contained in accounts

16 or, specifically, that I had in the bank at any one

17 point in time.

18 Q Those are facts, but I'm asking you, as you

19 said that he didn't think -- in your opinion, he didn't

20 think you were committing a Ponzi scheme or stealing

21 money from your accounts, he just thought that you were

22 committing crimes, I'm asking you to identify the

23 crimes.

24 You identified one: money laundering. Are

25 there any other crimes that you can identify that you


Page 2174

1 believe, based upon the information you gave

2 Mr. Spinosa, that he would have believed you were

3 committing.?

4 ALL PRESENT: Objection.

5 A Fraud on my clients, with regard to the

6 ability to lock their funds and prevent any access to

7 it; and fraud pertaining to bank balances and my general

8 banking business.

9 BY MR. RABIN:

10 Q Now, you have said you testified previously

11 that Mr. Spinosa gave you permission to sign his name,

12 correct?

13 A My recollection is that there was one occasion

14 when I was on the speaker phone. I was talking to him

15 about needing something signed, and he said, just sign

16 my name.

17 Q Let me ask you about that. If you authorize

18 somebody in your office to sign your name -- which you

19 did on occasion, correct?

20 A There were tons of people signing my name.

21 Q Tons of people.

22 With your permission, right?

23 A With and without.

24 Q Okay. Were they -- the people that you told

25 them to sign -- by the way, "with or without," who was


Page 2175

1 signing your name without your permission?

2 A There were people all over the firm, I came to

3 learn, signing my name. I don't specifically recall,

4 but my name was being signed on a lot of different

5 things.

6 Q Okay. Let's talk about the ones where you

7 gave people permission to sign your name. Who were

8 those people?

9 A Debra Villegas, Amy Howard, Mary Beth Feiss,

10 David Boden.

11 Q Now, when you gave them permission to sign

12 your name --

13 A Stu Rosenfeldt.

14 Q I'm sorry.

15 A That's it, I think.

16 Q When you gave these people permission to sign

17 your name --

18 A Irene Stay.

19 Q Tell me when you're done.

20 A Maybe Bill Brock.

21 That's all I remember at this time. There may

22 be more.

23 Q All right. When you gave these people

24 permission to sign your name, would they just sign your

25 name with their hand?


Page 2176

1 A Yeah, they scribbled it.

2 Q Okay. Now, with respect to Frank Spinosa

3 giving you permission to sign his name, you didn't just

4 scribble his name, did you?

5 A No.

6 Q You cut and pasted a real signature of Frank

7 Spinosa's onto a document in order to make it appear as

8 if he had actually signed it, correct?

9 A Sure. Because when he said, just go ahead and

10 sign my name, I took that as put his signature on there.

11 We were in the middle of committing a fraudulent act, so

12 I didn't think that he thought that I just signed his

13 name to the document. That wouldn't fulfill the purpose

14 because we were going to send that document off to a

15 client.

16 Q Okay.

17 A I am not going to tell a legitimate investor

18 that I signed the banker's name.

19 Q So did Frank tell you, listen, you need to --

20 if you're going to -- sign my name, but if you're going

21 to sign my name, you need to cut and paste so it looks

22 like my signature?

23 A No, sir.

24 Q He didn't do that?

25 A No, sir.


Page 2177

1 Q You took that initiative on your own?

2 A I did.

3 Q Okay. Couple of things. You had some kind of

4 a system at your office where a voice message to you

5 would be transcribed into an email to you; is that

6 correct?

7 A Yeah. It's called SimulScribe.

8 Q And explain to us how that worked, please.

9 A I don't really know how it works. I know that

10 if you called and left a message, that it would

11 transcribe the message as best as it could.

12 Q Okay. And so when we see -- and you would get

13 it as an email?

14 A Yeah, but you can tell it's SimulScribe

15 because it looks like it's coming from a telephone

16 number.

17 Q So that's how those -- it would be an email

18 message that appears to be coming from a phone number?

19 A Yes.

20 Q And that would be the system where somebody

21 left a message on your phone and it was transcribed and

22 sent to you, correct?

23 A Yes.

24 Q Was that automatic, or did you have to request

25 that?


Page 2178

1 In other words, did you have to request it to

2 transcribe the message, or all the messages that came

3 into your phone automatically transcribed?

4 A No. If you left a message -- during the

5 period of time that I had SimulScribe active, if you

6 left a message, it would have been transcribed, and it

7 should say something like "phone tag" on it, on the

8 message.

9 Q Did the system automatically send the messages

10 to you, or did they go to somewhere else and you had

11 them forwarded to you?

12 A I think they came directly to my email, but I

13 don't recall.

14 Q Yesterday -- I believe it was yesterday -- you

15 were shown one of your -- an email to one of your

16 events, and you said that the email list of the people

17 invited was cut off, and you remember you pointed to the

18 arrows on the side?

19 A Yes.

20 MR. RABIN: Okay. Let me show you what I

21 think is going to be a more complete list.

22 This is Exhibit Number 257. We have some

23 extra copies of this.

24 (Thereupon, the document was marked as Spinosa

25 Exhibit 257 for Identification.)


Page 2179

1 MR. SCHLESINGER: FP, on the bottom,

2 112310-0144261.

3 BY MR. RABIN:

4 Q Let me know when you're done reviewing it.

5 A Yes. Unless you want me to read every name,

6 yes.

7 Q Well, my first question is this: Does this

8 appear to you to be a complete list of the people that

9 went to or that you invited to this event?

10 A I can't -- I can't tell one way or the other.

11 The problem with the way my system was

12 working, for almost -- I think it was actually the

13 entire time that I was sending out event invitations,

14 was that I could never get the whole group thing to work

15 properly. So I actually had to sit there and go through

16 everyone's email addresses and click and paste and click

17 and paste. So the lists will vary from event to event.

18 I tried to be as inclusive as I needed to be

19 for each event.

20 Q But at least for this email, it appears to be

21 the complete list that you sent for this email?

22 A I -- again, I can't tell one way or other.

23 Q Well --

24 A I mean, I may have sent the same -- I had --

25 if you look through my email traffic, I generally sent


Page 2180

1 the same invitation multiple times to different groups

2 of people.

3 I would send out one, and I would figure out

4 that I left out people. I would send out another, and

5 then someone would remind me to include someone else, so

6 we'd send out another.

7 Q So this one appears to go -- so it starts with

8 the A's and goes to the W's, correct, and then there's

9 some A's at the end again?

10 A Yeah. The reason is A is at the end again,

11 because I had to go through -- what I would do is pull

12 up each address, click on it and paste it over, click on

13 it and paste it over; and then, if I forget somebody, I

14 would go back and do it again.

15 And then, once this was sent out, if my staff

16 realized or I realized I didn't copy somebody or I met

17 someone new, perhaps, I would send out another one and

18 another one.

19 Q Okay. This particular event was a Charlie

20 Crist event at your house --

21 A Yes.

22 Q -- correct?

23 All right. There are a number of people that

24 you named throughout the course of your deposition that

25 were on this list. It's kind of a summary of many of


Page 2181

1 the people that you involved in some way or another in

2 your scheme, correct?

3 A Some of them, yes.

4 Q All right. And others that you didn't

5 involved that are on the list, right?

6 A Most of them I didn't involve.

7 Q Okay. Do you remember -- like does this help

8 refresh your recollection as to who was at this event in

9 any way?

10 A Not at all.

11 Q Do you -- for example, Mr. Scherer is on this

12 list; do you recall him attending that event?

13 A I have no recollection one way or the other.

14 Q So you don't know whether he was or was not.

15 I also note that none of the TD Bank employees

16 are on this list, that is the ones that you named most

17 prominently: Ms. Kerstetter, Ms. Caretsky and

18 Mr. Spinosa.

19 A I don't see them on there.

20 Q Okay. Is there a reason for that?

21 A I don't know. What do you mean, is there a

22 reason for it?

23 Q Is there a reason that you didn't include

24 them?

25 A I just got done telling you that this list may


Page 2182

1 not be inclusive. I would certainly not intentionally

2 cut them out; although, I don't think I would invite Ms.

3 Caretsky or Ms. Kerstetter; but I definitely invited

4 Frank to certain political events, and he showed up at

5 certain political events.

6 Q I know you're saying that, but this is the

7 email for this event, and you're saying that if he's not

8 on this one, he could be on another one, correct?

9 A Yes. When you first started questioning me, I

10 told you that I sent out multiple invitations to the

11 same event.

12 Q I understand.

13 But there would be -- if he was on one of

14 these lists, there would be an email -- there would be

15 email trace of it, correct?

16 A Unless someone deleted the email, it wasn't

17 recovered, there should be an email record of it, yes,

18 sir.

19 Q Do you have -- as you sit here today, can you

20 say with certainty that Frank Spinosa received an email

21 to this event?

22 A No. Because here's the problem that you have

23 is that I also verbally invited many people to these

24 events. I could invite people that I intended to call

25 and did, in fact, call. I could invite someone in


Page 2183

1 passing that I just met today to an event on a

2 particular day.

3 It -- this -- the best way to see if someone

4 came to an event, Mr. Rabin, is what I testified over

5 the last seven days; and that is, check the attendance

6 list.

7 Q All right. And the person that would -- that

8 we could check that attendance list from is who again?

9 A You can check with -- I believe the trustee

10 has all our records. You could check those records; and

11 probably the best place to check would be with the

12 campaigns, themselves, because they maintain records of

13 who showed up, who brought a check, who didn't, how much

14 they brought.

15 MR. RABIN: Just a couple more questions,

16 and then I have to wrap up.

17 But I do want to put on the record that I

18 am -- need a lot more time with you. But

19 because of the constraints on the order, I'm

20 not going to be able to have it. But I just

21 want to put on the record that on behalf of

22 Mr. Spinosa, that the time that we have been

23 allotted is insufficient, and we would like to

24 have additional time at some future date.

25


Page 2184

1 BY MR. RABIN:

2 Q Regarding Mr. Scherer, just a couple of

3 questions about him again.

4 You said that --

5 A You know something -- one second, Mr. Rabin.

6 Again, I just -- I was just, for some reason I

7 was thinking back to the whole Morocco thing.

8 I called Marc -- just so you have the

9 information -- a couple of days after I was there.

10 It was subsequent to a meeting that he had had

11 after I spoke to him. I remember him telling me, asking

12 me, what the hell is going on, because he had just had

13 some kind of meeting with Stu and Grant Smith and them,

14 if that helps you time frame-wise. It was also more

15 toward the 30th or 31st.

16 Q And you were still thinking about suicide

17 after that call; is that what you're saying?

18 A I was thinking of killing myself the entire

19 time that I was there.

20 Q With Mr. Scherer, you had more of a

21 relationship with him than you have disclosed so far;

22 isn't that fair to say?


24 A No. What you're doing is twisting my words.

25 I had a good relationship with Mr. Scherer.


Page 2185

1 I --

2 BY MR. RABIN:

3 Q Define that.

4 A Let me finish.

5 I considered him my friend. I tried to do

6 business with him.

7 Q How many times?

8 A Multiple times.

9 Q Okay.

10 A He was an extremely powerful lawyer, and I

11 wanted to do business with him. I thought it would

12 increase my legitimate business.

13 He tried to help me get on committees. He

14 tried to send my law firm work.

15 Mr. Scherer, I believe -- it is my opinion

16 that he believed we were a legitimate, up-and-coming law

17 firm, and he tried to do good things for us.

18 Q Did you refer any of your -- the people that

19 invested in your Ponzi scheme to him as clients?

20 A No, sir.

21 MR. RABIN: Okay. All right. That's all

22 the time that I have been allotted.

23 Again, for the record, I would request

24 additional time, at the appropriate time.

25 MR. LICHTMAN: I think the record should


Page 2186

1 reflect that there is not a lawyer in the room

2 that would represent that they have had

3 sufficient time.

4 There are issues, but everybody has been

5 acting civil.

6 ALL PRESENT: I'll stipulate to that.

7 THE WITNESS: Who's next?

8 MR. CRAIG: I have five minutes.

9 THE WITNESS: Okay. I actually expected

10 to see you sitting there when I first came in

11 this morning. That's the way I'm used to

12 starting my day.

13 MR. CRAIG: I hope I didn't disappoint

14 you.

15 THE WITNESS: No, no.


17 BY MR. CRAIG:

18 Q I'm going to be showing you a new exhibit, 258

19 for Identification. It's an email dated April 22nd,

20 2009, 8:30 p.m., from you to Bill Brock; Subject: Bank.

21 It is part of the Trustee's original production. It was

22 not located until last night when an additional search

23 was performed based upon Mr. Rothstein's testimony

24 yesterday, and it was discovered through an inadvertent

25 misspelling of my client's first name, Rosanne.


Page 2187

1 And that's how it was discovered, and that's

2 why it wasn't produced beforehand.


4 Caretsky Exhibit 258 for Identification.)

5 MR. SCHERER: What number is it going to

6 be?

7 MR. RABIN: 258.

8 BY MR. CRAIG:

9 Q I'm also going to show you at the same time a

10 copy of 223, which was the email exhibit which I showed

11 you yesterday.

12 A Yes, sir.

13 Q You had an opportunity to look at the new

14 email? What is that, Exhibit 258?

15 A Yes, sir.

16 Q Do you recognize it?

17 A Yes.

18 Q And what do you recognize it as?

19 A An email to Mr. Brock.

20 Q Do you recall sending that email to Mr. Brock?

21 A I do.

22 Q Could you read it out loud, please.

23 A Need you to be out there first thing in the

24 a.m. with the same printout we just used. You need to

25 get it from Deb and you need to figure out a way to get


Page 2188

1 it into a sealed envelope from TD and have Roseanne

2 (sic) or one of her people hand it to me.

3 Q Okay. That was on April 22nd of 2009?

4 A Correct, sir.

5 Q Wouldn't you agree, sir, that that is

6 inconsistent with your prior testimony that Rosanne was

7 on board as of the first "show" back in October of 2008,

8 six months beforehand?

9 A Two things. One --

10 Q Yes or no, and then explain.

11 A As I just said, no, it's not consistent.

12 Q Okay.

13 A It's inconsistent.

14 It's -- hold on. It's not -- we're double and

15 triple no'ing. It is not inconsistent with my prior

16 testimony.

17 Q Is that the same as it is consistent with your

18 prior testimony?

19 A It is consistent with my prior testimony.

20 Q Okay. You can explain.

21 A Okay. Two things. One, all right, with

22 regard to the timing of when Rosanne got involved, okay,

23 I have been crystal clear throughout my testimony that I

24 don't know the date.

25 Okay. I do know that there were points in


Page 2189

1 time when Mr. Caputi was doing this for me, and my best

2 recollection is that that was prior to Ms. Caretsky's

3 involvement.

4 That's my best recollection.

5 As far as figuring out a way to get it into a

6 sealed envelope, if you'll notice on here, it says "or

7 one of her people."

8 Okay. And the only person that I had talked

9 to about doing this was Rosanne, and if she was not

10 going to be out there, he was going to have to do the

11 placement of the documents.

12 So it's not -- it is consistent with what I

13 have been saying all along.

14 Q But isn't it crystal clear from this email

15 that you anticipated that Rosanne was going to be out

16 there --

17 A No.

18 Q -- based -- let me --

19 A Sorry. I apologize.

20 Q Let me finish the question.

21 -- based upon the statement -- and I'm quoting

22 -- You need to figure out a way to get it into a sealed

23 envelope from TD and have Roseanne (sic) or one of her

24 people hand it to me?

25 A And I'm telling you that I was frequently


Page 2190

1 unartful in writing emails and my concern was the "one

2 of her people."

3 If Rosanne was, on April 22nd, 2009 -- you'd

4 have to lay out the time line using the emails --

5 involved at that moment, okay, which I believe she was,

6 then this was directed to the problem that she wasn't

7 even going to be there.

8 And this has to be a harried -- you have got

9 to give me the email traffic. As I said other day when

10 we talked about these emails, I need to see all the

11 email traffic from before this email and after this

12 email --

13 Q Okay.

14 A -- otherwise I can't tell. Because I have got

15 to tell you something, that normally I knew who was

16 going to be at the bank.

17 So another thing that this email is telling me

18 is that this was a very harried thing that was going on,

19 that Bill was rushing around, that I was rushing around,

20 because we didn't even know.

21 Normally we know: Rosanne is going to be at

22 the bank; Kerstetter is going to be at the bank. So we

23 don't know who is going to be at the bank, and we deal

24 with it according.

25 Q Is that why it says "urgent" underneath the


Page 2191

1 text of the email?

2 A I'm sorry?

3 Q Is that why you insert the word "urgent"

4 underneath the text of the email?

5 A I would be guessing. It was urgent because

6 someone wanted to do a bank visit, and I needed to make

7 sure that this was not screwed up --

8 Q Well --

9 A -- when we got out there.

10 The other thing is, is that, as I'm reading

11 this, it's also -- and it's most likely that someone

12 else -- that I was concerned that someone else was going

13 to be there. Because when I said "you need to figure

14 out a way to get it into a sealed envelope," if it was

15 definitely going to be Rosanne, there would be no reason

16 for him to have to figure out how to get it in there.

17 MR. CRAIG: Let me go ahead and object

18 and move to strike based upon you prefacing

19 the last part of that answer with "most

20 likely."

21 BY MR. CRAIG:

22 Q You remember, we don't want to guess here.

23 You agreed not to do so, sir, correct?

24 A Yes.

25 Q Okay.


Page 2192

1 A I don't want to guess, but I'm telling you

2 what was going on at the time.

3 Q Okay. You said you wanted to see some email

4 traffic from both before and after.

5 A Yes, please.

6 Q I'll call your attention to 223, which is the

7 email I showed you yesterday.

8 A Do you have a copy of it?

9 Q Check --

10 MR. RABIN: You have it.

11 THE WITNESS: Oh, I do?

12 No. I'm sorry. 223 I have.

13 MR. CRAIG: Yeah, I gave them --

14 MR. RABIN: Here's another copy. I gave

15 you both copies.

16 THE WITNESS: Hang on one second.

17 I apologize.

18 MR. RABIN: Here's another copy.

19 MR. SCHERER: What is this last exhibit

20 number, the "urgent"?

21 MR. CRAIG: 258.

22 THE WITNESS: Okay.

23 BY MR. CRAIG:

24 Q What's the date and time on that email, the

25 223?


Page 2193

1 A Let's see. Let's see.

2 Okay. 223. It starts -- these are kind of

3 intertwined.

4 You have got April 22nd at 2034. What time --

5 that's 8:34 in the evening? That is the 22nd. That's

6 the 22nd. It's eight something in the evening.

7 Q 2036, isn't it?

8 A Hang on a second.

9 April 22nd at 2033. That's 8:33, right?

10 So that's after this first one.

11 And then -- then they seem to proceed.

12 So what looks like -- would you like me to

13 explain this?

14 Q I'm confirming my eyesight here.

15 A That's all right. I know the feeling.

16 Q 2033, 2036, 34, whatever, it's within minutes

17 of the email that I just showed you today marked 258?

18 A Right. Right. But the timing of it is

19 important, and I'll show you why.

20 Q Okay. Wait for a question.

21 A Sure.

22 MR. CRAIG: For the record, we read the

23 time on the email from yesterday, 223, as

24 2036, but we'll stand corrected.

25


Page 2194

1 BY MR. CRAIG:

2 Q If Rosanne was actually on board at that time,

3 that being April 22nd of 2008, you wouldn't need Uncle

4 Bill to figure out a way to get the fake account balance

5 into an envelope, correct?

6 A You're misreading the email, sir.

7 Q I'm asking you a question.

8 A If she was on board and there were not going

9 to be any other problems out there, other people at the

10 bank that we were going to have problems with, then he

11 wouldn't have had to figure out a way to do it.

12 Q And like --

13 A We would have to make sure that she did it.

14 Q And likewise with respect to No. 223, if

15 Rosanne was on board as of April 22nd of 2009, you would

16 not need to have Uncle Bill work magic to get our

17 statements in the envelope and get her to hand it to me,

18 correct?

19 A As I testified the other day when you asked me

20 about this, yes, I would.

21 You're assuming that "work magic" means that

22 he's got to sneak around behind her back.

23 "Work magic" is to make sure -- you know, Bill

24 was an expert, and one of the things you'll see when you

25 question him, he was an expert at relationships.


Page 2195

1 Everybody loves, quote, unquote, Uncle Bill.

2 So Billy working his magic to get our

3 statements into the envelope is to make sure that

4 Rosanne is following through, as I said the other day,

5 with what she was supposed to do.

6 Q Let's see if we can clear up the matter of the

7 possibility that Rosanne wasn't going to be there.

8 Okay.

9 Why don't you take a look at Exhibit 223.

10 A Actually, you're -- you have both of these

11 marked as 223 now.

12 MR. RABIN: No. Let's do it again.

13 MR. CRAIG: The one with the yellow

14 exhibit marker, 258, is the one from today.

15 THE WITNESS: Okay. Hang on one second.

16 258? I have got that. Okay. We just

17 have an extra copy.

18 MR. CRAIG: And now do you have something

19 that says --

20 THE WITNESS: Hang on a second. I now

21 have 223 from the other day and 258.

22 BY MR. CRAIG:

23 Q Okay. 223 from the other day, at the top,

24 could you read the text of the email at the top of that

25 exhibit?


Page 2196

1 A Yes. "Bank opens at 7:30. Rosanne will be in

2 at seven for us."

3 Q Stop.

4 This confirms, Mr. Rothstein, that there was

5 no question in your mind at that time that Rosanne was

6 going to be at the bank that day?

7 A You are 100 percent incorrect, and you're not

8 reading this in order. Let me explain, please.

9 Look at the first email. It is clear that on

10 April 22nd, 2009, at 8:30 p.m. I did not know who was

11 going to be at the bank.

12 By April 22nd at 8:58 and 25 seconds p.m.,

13 that is when I knew.

14 So at the time I wrote the first email that

15 I've already described and explained, I did not know who

16 was going to be there.

17 Twenty-some-odd minutes later, I did know who

18 was going to be there.

19 MR. CRAIG: We ready for a break?

20 I would likewise reserve the right on

21 behalf of Ms. Caretsky.

22 MR. SCHERER: I would like to reserve

23 some time for redirect examination, especially

24 since they keep throwing my name on these

25 invite lists and other things that I wish


Page 2197

1 you'd clear up.

2 MR. LAUER: Well, you're welcome to

3 testify as a witness at trial, but there is no

4 rebuttal or redirect.

5 I would like to ask that everybody be

6 back here promptly at 1:00 because I have been

7 assigned four hours or so. We protest that.

8 MR. SCHERER: There is rebuttal if

9 there's time, according to the order.

10 MR. LAUER: You already took -- You

11 already took an extra half an hour in

12 violation of the protocol which impinged on

13 our ability -- I want this down -- which

14 impinged our ability to live within the small

15 amount of time that we have been allotted.

16 MR. LICHTMAN: Actually that time --

17 MR. LAUER: So you don't get rebuttal.

18 You have already had your rebuttal.

19 MR. LICHTMAN: That time was made up,

20 though. That time was made up.

21 MR. LAUER: The time was not made up for

22 me.

23 MR. NURIK: The time was made up; and by

24 the way, you don't run the show.

25 MR. LICHTMAN: You need to work that out


Page 2198

1 with your defense counsel.

2 MR. SCHERER: Right. You need to work it

3 out together.

4 MR. LICHTMAN: The plaintiffs and

5 defendants get the same amount.

6 MR. LAUER: I don't accept that, and

7 we're going to have -- we're entitled to have

8 our rights respected.

9 (Thereupon, a recess was taken.)

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Page 2199

1 C E R T I F I C A T E

2

3 THE STATE OF FLORIDA, ) COUNTY OF BROWARD. )

4

5 I, Michele L. Savoy, Shorthand Reporter do

6 hereby certify that I was authorized to and did

7 report the foregoing proceedings and that the

8 transcript is a true record.

9 Dated this 21st day of December 2011.

10

11 ______________________________

12 Michele L. Savoy, RPR Notary Public - State of Florida

13 My Commission No. EE 113173 Expires August 6, 2015

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Page 2200

1 C E R T I F I C A T E

2 THE STATE OF FLORIDA, ) COUNTY OF BROWARD. )

3

4 I, Michele L. Savoy, Shorthand Reporter,

5 do hereby certify that I was authorized to and did

6 report said deposition in stenotype; and that the

7 foregoing pages, numbered from 2027 to 2200,

8 inclusive, are a true and correct transcription of

9 my shorthand notes of said deposition.

10 I further certify that I am not an

11 attorney or counsel of any of the parties, nor am I

12 a relative or employee of any attorney or counsel or

13 party connected with the action, nor am I

14 financially interested in the action.

15 The foregoing certification of this

16 transcript does not apply to any reproduction of the

17 same by any means unless under the direct control

18 and/or direction of the certifying reporter.

19 Dated this 21st day of December, 2011.

20

21 ___________________________________

22 Michele L. Savoy, RPR Notary Public - State of Florida

23 My Commission No. EE 113173 Expires August 6, 2015

24

25

Documents

2011-12-21 Rothstein Scott AM