The verdict, which awarded $32 million in compensatory damages and $35 million in punitive damages to the investors, came after a trial before U.S. District Judge Marcia Cooke that began in November. The Daily Business Review, our South Florida sibling publication, has a rundown of the case, which was the first of several pending suits filed by Rothstein investors looking to recoup losses to head to trial. TD Bank is also facing other investors suits related to the scheme.
“This Ponzi scheme would have been impossible without TD Bank actively involved,” Coquina lawyer David Mandel, a partner at Mandel & Mandel, told the DBR. “I think this jury was angry with them, and it showed in the verdict.”
But TD Bank continues to hold that it did nothing wrong because it represented Rothstein’s law firm, not Rothstein himself. “We still maintain that we were Rothstein Rosenfeldt Adler’s bank, and that it was Scott Rothstein who defrauded investors,” TD Bank spokeswoman Rebecca Acevedo told the DBR. “We will continue to defend the bank against claims of wrongdoing.”
Rothstein pled guilty last January to operating the fraud through his Fort Lauderdale-based law firm. The fraud involved telling victims they were buying stakes in phony settlements. Rothstein used TD Bank to make payments to investors. The notorious conman is now cooperating with federal prosecutors, and seven of his employees and associates have been criminally charged.