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Three small law firms played a key role in keeping convicted Ponzi schemer Scott Rothstein’s operation secret from New York hedge fund operators, according to lawyers attending the disbarred lawyer’s tell-all deposition Tuesday. The closed-door proceedings in a Miami federal courtroom entered a second day in a two-week stand, with nearly three dozen lawyers scheduled to take turns questioning Rothstein about his $1.2 billion scheme. Rothstein said three law firms helped him, according to lawyers who spoke on condition of anonymity. Lawyers who attended the deposition said those law firms were solo shops run by Steve Rossi, a Fort Lauderdale criminal defense attorney and former FBI agent; Wayne Koppel, a Plantation personal injury lawyer; and Howard Herskowitz, a Fort Lauderdale personal injury lawyer. Calls to Rossi and Koppel were not returned by deadline. Robert Nicholson, who represents Herskowitz, said his client “categorically denies perpetrating any fraud of any sort.” He said Herskowitz did refer cases to some lawyers at Rothstein Rosenfeldt Adler, but that was before they worked for Rothstein. A lawyer who attended the deposition explained how the other law firms allegedly got involved. A hedge fund that invested with the law firm chair inquired about the source of his money while he was still operating his settlement financing fraud, which collapsed two years ago. The hedge fund sent a portfolio manager to South Florida to review how Rothstein acquired his cases because he claimed to be dealing with hundreds of settlements, which later turned out to be fake. To make it believable, Rothstein used the names of three prominent attorneys. But to keep the fraud from being uncovered, he persuaded three smaller firms to be named instead as the source of his referrals. “They were single shingles, with tiny practices, and he would trot them around saying they had sent him tons of cases,” said the lawyer inside the deposition. “It was not believable.” Rothstein also identified two TD Bank managers as accomplices — senior vice president Frank Spinosa and Weston branch manager Rosanne Caretsky, who have been deposed in related civil cases. They do not face criminal charges. Lawyers at Tuesday’s deposition said Rothstein spoke at length about cutting deals with both Spinosa and Caretsky to have them provide documentation needed to commit the fraud. He allegedly paid $52,000 to Spinosa and $25,000 to Caretsky — all in cash — and shared with them his “rock star lifestyle.” In the civil litigation, they are accused of giving investors a false sense of security by producing letters claiming their money was safe in locked accounts and hosting grandiose shows when money was accepted from unwitting victims. Rothstein’s assertions were dismissed by Miami lawyer Michael Schlesinger of Schlesinger and Cotzen, who represents Spinosa. “I can’t wait to cross-examine him to show how much he’s lying. These are softball questions from plaintiff attorneys hoping to recover money,” Schlesinger said. Caretsky’s lawyer, Dan Gelber, took a similar approach, saying Rothstein is “a professional liar. He’s obviously trying to use his skill set to fabricate stories to potentially reduce his sentence.” Spinosa refused to answer numerous questions on the witness stand in a federal trial where the investor group Coquina Investments is seeking damages from TD Bank. At a deposition last year, Caretsky answered questions about benefits she received from Rothstein by saying he or an associate once paid her tab at a Boca Raton restaurant. Rothstein is serving a 50-year sentence on his guilty plea but said Monday that he hopes his cooperation outlining his scheme will get him out of prison alive. Rothstein’s comments Monday gave William Scherer of Conrad & Scherer enough information to file a lawsuit Tuesday in Broward Circuit Court against auto magnate Ed Morse and Morse Operations, claiming Morse and relatives participated in Rothstein’s fraud. Meanwhile, U.S. Bankruptcy Judge Raymond Ray agreed Tuesday to modify an order on access to transcripts from Rothstein’s deposition, allowing them to be released to news media a week after each day’s session is completed.

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