EFTA01082404.pdf

Four arrested in Rothstein case I South Florida Business Journal Page I of 2 rom the South Florida Business Journal: Four arrested in Rothstein case South Florida Business Journal Date: Friday, May 27, 2011, 10:07am EDT Related: Banking & Financial Services, Legal Services A year-and-a-half after Scott Rothstein was arrested and charged with running a $1.2 billion Ponzi scheme, four of his former associates have been charged with helping him carry out the scam. Authorities said Friday that they were filing charges against Howard Kusnick, 58, of Tamarac; Stephen Caputi, 53, of Lauderhill; William Corte, 38, of Plantation; and Curtis Renie, 38, of Fort Lauderdale. The defendants are alleged to have conspired to further Rothstein's investment scheme involving the sale of purported confidential settlement agreements in sexual harassment, discrimination and/or whistle-blower suits. Kusnick was an attorney with Rothstein Rosenfeldt Adler. Corte and Renie were employees of RAA's information technology department. Caputi was an associate of Rothstein. The four have been charged with one count of conspiracy to commit wire fraud. If convicted they face up to five years in prison. Caputi and Corte are expected to make their initial appearances in Fort Lauderdale federal court Friday morning. Kusnick and Renie are expected to appear in federal court next week. Kusnick is alleged to have written a letter purporting to settle pending litigation in favor of a client, but it is alleged no litigation ever took place and no settlement ever existed. Instead, the letter was "to lull the clients into believing that RRA was pursuing litigation on their behalf when, in fact, the clients' funds had been used to pay off earlier investors and to further the investment fraud scheme," according to a news release from the U.S. Attorney's Office in Miami. Caputi is alleged to have posed as an official from TD Bank in meetings with investors, and allegedly provided fraudulent bank statements. hup://www.bizjournals.com/southfloridainews/2011/05/27/four-arrested-in-rothstein-case.... 5/27/2011 EFTA01082404 Four arrested in Rothstein case South Florida Business Journal Page 2 of 2 He also is alleged to have posed as one of RRA's plaintiffs who executed a $10 million settlement agreement in an effort to raise potential investors' confidence in the deal. Renie and Corte are alleged to have created a fictitious Web page, copying the legitimate Web page of TD Bank. They are also alleged to have posted false account balances on the fictitious Web page to make it appear as if the accounts were well funded. "On one occasion, the defendants modified the phony TD Bank website to reflect that RRA held between $300 million and $1.1 billion on deposit at TD Bank. In fact, however, no such funds were in the accounts. The false account balances were shown to investors to induce them to invest into the fraudulent investment scheme," the news release stated. "The house of cards supporting Scott Rothstein's elaborate Ponzi scheme continues to crumble," U.S. Attorney Wifredo A. Ferrer said in a news release. "As today's charges confirm, we will follow all leads and continue to bring to justice those who helped Rothstein execute this billion-dollar fraud and any other crimes that may have been committed through RAA. The investigation continues." 5/27/2011 EFTA01082405