In his protracted quest to reduce his 20-year prison sentence and stay in the spotlight, Nevin Shapiro turned on his once-beloved University of Miami.
But the former sports booster and agent who ran a $930 million Ponzi scheme now has a new target: his former attorneys at the law firm Lewis Tein.
The former Miami Beach businessman known for lavishing his ill-gotten gains on UM athletes wrote U.S. District Judge Joan Lenard on May 17 to say he lied on the witness stand as a key government witness. Shapiro also said his attorneys knew of his fraud when he testified at the La Bamba $132 million money laundering trial of Juan Rene Caro.
The letter and an accompanying ethics complaint to The Florida Bar adds fuel to Caro’s second attempt to try to persuade the Miami judge to hold an evidentiary hearing on Shapiro’s testimony.
Guy Lewis is a former interim U.S. attorney in Miami, and Michael Tein is a former federal prosecutor who previously worked with the assistant U.S. attorney assigned to the La Bamba case.
"The admission of the perjury by Shapiro calls into question his entire testimony against Caro," said Caro’s attorney, Arturo V. Hernandez said. "It also raises the question: What did the government know and when did it know it?"
The ethics complaint details, among other things, a "piano party" at Lewis’ home where shots from a 65-year-old bottle of Macallan Scotch worth $246,000 were poured for guests, including Shapiro.
Asked for comment, Tein said, speaking for himself, "These recycled, jailhouse allegations are still false."
Miami criminal defense attorney Richard Sharpstein, a partner at Akerman Senterfitt, said the letter and ethics complaint against Lewis Tein is an example of why Shapiro is "a Class A, sociopathic lunatic."
Sharpstein, who is not involved in the case, said there is no way the latest petition for a court hearing as well as the complaint to The Bar can help Shapiro reduce his prison sentence.
"This doesn’t help Shapiro one iota, one bit. He is only further burying himself in front of Judge Lenard," Sharpstein said. "There is no vehicle for him to gain anything at all from this. He already has no credibility to begin with, and now he has said he has committed perjury."
Shapiro’s attorney Maria Elena Perez of Coral Gables declined to comment on how the letter and complaint might assist her client. Perez has said Shapiro, in his own words, is determined to do the right thing to prevent "others from being hurt in the same way."
The U.S. attorney’s office said it had no comment on whether it would investigate Shapiro for perjury following his admission.
He took the stand against Caro in December 2008. For his testimony, Shapiro was offered immunity from prosecution for illegal activities related to Caro and his La Bamba check-cashing store chain.
Shapiro says he committed the perjury on cross-examination by Hernandez by saying his business, Capitol Investments USA LLC, was legitimate. In fact, it was a $930 million grocery-trading fraud.
When asked by Hernandez the nature of his work and business ventures, Shapiro said, "I’m a wholesale grocery broker, and I raise capital for real estate projects."
Hernandez’s queries about Capitol Investments were then cut off when the government objected and Lenard sustained the objection.
Caro’s defense attorney, in an unsuccessful motion for a new trial in January 2011, alleged Shapiro also lied about his role in the money-laundering conspiracy that provided illegal check-cashing services to construction companies.
Shapiro said in The Bar complaint attached to the letter that his attorneys put him in a position where he had no other choice but to lie.
Lewis and Tein "undoubtedly knew I would be asked questions during the course of my trial testimony that had the potential of or would likely invite a response that would incriminate me," he wrote.
His lawyers knew "I would not disclose the facts about what was occurring within Capitol Investments USA to either the IRS agents or the district court," Shapiro said.
Shapiro maintains he was completely truthful about his illegal activities to his attorneys.
"Unfortunately, I am not a lawyer, and I trusted the advice of my former attorneys," Shapiro wrote the judge. "I had no idea they were guiding me in the wrong direction, and essentially gave me legal advice that was inconsistent with the law."
Within months, Shapiro ended up in Caro’s position — behind bars — when Capitol Investments was exposed as a pyramid scheme by federal investigators in New Jersey.
Sentenced to 20 years after a plea deal, Shapiro didn’t go quietly. He made headlines when he went public in mid-2011 with tales of showering UM athletes with cash, prostitutes, expensive dinners, jewelry and parties at his mansion. After his plea, Shapiro and Perez worked with the NCAA and a court-appointed bankruptcy trustee overseeing the remains of Capitol Investments in hopes of getting his sentence reduced. The NCAA probe of the UM athletics program is expected to wrap up in July.
Now Shapiro blames his perjury in the Caro case on his former attorneys.
"I believe a terrible injustice has occurred at the hands of my former attorneys, and it is my opinion that Mr. Caro was not given a fair trial as a result of the misconduct of my former attorneys," Shapiro wrote Lenard, attaching The Bar complaint.
Lewis said an insider at the Justice Department told him Shapiro was about to be charged 20 days after he testified, the Bar complaint said. Shapiro said Lewis "shockingly" insisted he sign an additional fee arrangement Dec. 31, 2008, to pay the firm $50,000 a month to represent him in the New Jersey fraud investigation.
The Miami Herald reported on Shapiro’s letter to the judge and Bar complaint in its Monday editions.
"Lewis Tein has yet to receive a copy of Mr. Shapiro’s letter from either Mr. Shapiro, his lawyer Maria Elena Perez or The Florida Bar," the law firm said in a statement to the Daily Business Review.
Bar spokeswoman Francine Walker said Wednesday that the complaint was received but it would have to be resubmitted as a sworn affidavit before a file would be opened.
But Walker said coincidentally an ethics complaint against Perez has moved from the initial staff investigation to the grievance committee level. A panel of attorneys and lay people will decide whether there is probable cause to file ethics charges on whether Perez had a conflict of interest working for Shapiro and with NCAA investigators.
A complaint goes to a grievance committee only if The Bar staff finds a potential rules violation, Walker said.
Lenard previously denied Caro an evidentiary hearing or a new trial based on allegations that Miami federal prosecutors knew Shapiro was implicated in a Ponzi scheme.
Calling him "Hurricane Nevin," Lenard said in her October 2011 order that Shapiro’s fraud plea has had wide-ranging repercussion, but she saw no evidence prosecutors knew of the New Jersey fraud investigation during Caro’s trial.
Assistant U.S. Attorney Wilfredo Fernandez, the prosecutor in Caro’s case, said in the government’s response that the chronology undermined Caro’s position: A civil bankruptcy case was initiated against Shapiro’s company in October 2009, he was indicted by a New Jersey grand jury July 14, 2010, and he signed a plea agreement in September 2010 — all long after Caro was convicted.
The Miami prosecution team learned of the criminal investigation into Shapiro in April 2010, Fernandez said.
‘Dancing In The Books’
Shapiro’s ethics complaint focuses on when Lewis Tein knew of the Ponzi scheme.
He attaches a March 31, 2008, internal office memorandum from Lewis Tein on information from Shapiro’s private investigator. The memo from attorney Dan Fridman, now with Holland & Knight, was generated when Lewis Tein was looking into whether Shapiro should press a claim against one of his business partners in a separate bankruptcy action in New Jersey.
The investigator told Fridman there was "dancing in the books" at Capitol Investments. Shapiro told The Bar that’s evidence he was a criminal.
The chronology of how Lewis Tein discovered Shapiro was a crook is spelled out in Capitol Investments bankruptcy depositions. Lewis Tein in April 2009 commissioned an internal audit of Capitol Investments after Shapiro’s investors started making noise, the depositions show.
Lewis in a 2011 deposition said he was wary of Shapiro’s business dealings from the start, but his client assuaged his doubts.
"I explained to him what a Ponzi scheme was. I said, ‘Nevin, you know are you robbing from Peter to pay Paul? Is that occurring here?’ " Lewis said in the deposition. "And the answer repeatedly, over and over, was no, no no."
In the same deposition, Lewis said he never would have taken Shapiro as a client if he knew the fee was coming from illegal activities. "Our reputation is all we have," he testified.
Lewis Tein settled a clawback suit with the bankruptcy trustee for $400,000 because part of the fee was paid by Shapiro with Ponzi funds. The firm also purchased Shapiro’s fishing yacht to partially cover his legal fees.
The Shapiro letter and complaint represents another headache for the Miami law firm, which is fighting the Miccosukee tribe — another former client — on several legal fronts. An ethics complaint filed in that litigation was dismissed by The Bar.
For Caro’s attorney, the new Shapiro court filing is an opportunity to press Lenard even harder for an evidentiary hearing.
"I think it’s highly significant, but I cannot presume to go any further than that," he said. "We deem it a confirmation, a validation if you will, of what we have been alleging all along."
For Sharpstein and other observers, Shapiro and his petitions to the court remain an entertaining legal sideshow. The veteran lawyer said the letter to Lenard is what lawyers face when clients can’t admit their own transgressions.
"It’s a last-gasp effort to suck some wind out of the federal sails," he said. "It becomes a lawyer’s nightmare when it becomes specific and complete utter fantasy."