EFTA01108756.pdf

SEALED UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF FLORIDA CASE NO. ig MAX' ealka l, 18 U.S.C. § 1349 FILED BY D.C. UNITED STATES OF AMERICA AUG 19 2013 STEVEN AA LARSOOHE V. CLERK U.S. DST. CT. S.D. OF RA FT. LAUD. CHRISTINA M. IUTTERMAN, Defendant. INDICTMENT The Grand Jury charges that, at all times relevant to this Indictment: GENERAL ALLEGATIONS I. Rothstein, Rosenfeldt and Adler, P.A. (hereinafter referred to as "RRA") was a law firm with offices located at 401 East Las Olas Boulevard, Fort Lauderdale, Florida and elsewhere. The law firm employed approximately seventy attorneys and engaged in the practice of law involving a wide range of specialties, including labor and employment law. 2. Scott W. Rothstein (hereinafter referred to as "Rothstein") was an attorney and the Chief Executive Officer (CEO) and Chairman of RRA. 3. The defendant, CHRISTINA M. FUTTERMAN, was employed as an attorney at RRA. 4. The Florida Bar is a statewide professional organization which regulates persons practicing law in the State of Florida. The authority for the establishment and maintenance of the Florida Bar is based on the Florida Supreme Court's constitutional authority to regulate the practice of law in Florida. The Florida Bar has established The Rules of Professional Conduct which provide EFTA01108756 the standards of professional practice for those persons practicing law in the State of Florida. A violation of those rules can lead to the suspension or disbarment of a licensed attorney. 5. TD Bank, N.A., (hereinafter referred to as "TD Bank") was a large commercial bank with branch offices in 13 states, including offices in Weston, Florida and Deerfield Beach, Florida. The executive offices of TD Bank were located in Portland, Maine and Cherry Hill, New Jersey. 6. Rothstein and RRA maintained approximately 38 bank accounts at TD Bank, which were utilized during the course of the fraudulent investment scheme further described below. 7. During the course of the fraudulent investment scheme further described below, funds were remitted to TD Bank by investors, and paid to investors through TD Bank, by wire transfers that were transmitted in interstate and foreign commerce. 8. From in or about mid-2008 through in or about April 2009, a related group of institutional investors (hereinafter referred to as the "Institutional Investors") invested tens of millions of the dollars in the fraudulent scheme further described below. In or about April 2009, the Institutional Investors informed Rothstein that they would not invest any additional funds and demanded that the funds previously invested, along with the purported profits, be paid to them. COUNT 1 (Conspiracy to Commit Wire Fraud, 18 U.S.C. § 1349) I. The General Allegations Section of this Information are realleged and expressly incorporated herein as if set forth in full. 2. In or about April 2009, in Broward County, in the Southern District of Florida, and elsewhere, the defendant, CHRISTINA M. KITTERMAN, 2 EFTA01108757 did knowingly and willfully combine, conspire, confederate, and agree with Rothstein and with other persons known and unknown to the Grand Jury to commit an offense against the United States of America, that is, to devise and intend to devise a scheme and artifice to defraud and for obtaining money and property by means of false and fraudulent pretenses, representations, and promises, and, for the purpose of executing such scheme and artifice to defraud and for obtaining money and property by means of false and fraudulent pretenses, representations, and promises, to knowingly transmit and cause to be transmitted by means of wire communication in interstate and foreign commerce, certain signs, signals, and sounds, in violation of Title 18, United States Code, Section 1343 (Wire Fraud). THE PURPOSE AND OBJECT OF THE CONSPIRACY 3. The purpose and object of the conspiracy was to enrich the members of the conspiracy by various means, including obtaining investors' money for the conspirators' own use and benefit and the benefit of others through the operation of a fraudulent investment scheme. THE MANNER AND MEANS OF THE CONSPIRACY The Fraudulent Investment Scheme 4. It was part of the conspiracy that, beginning in or about 2007, Rothstein and other co- conspirators began operating a fraudulent investment scheme. 5. It was further part of the conspiracy that the potential investors in the fraudulent investment scheme were informed that either RRA or firms affiliated with RRA represented potential plaintiffs (hereinafter referred to as "plaintiffs") in sexual harassment, discrimination, and/or whistle- blower suits and that settlements of these claims had been negotiated prior to filing law suits. 6. It was further part of the conspiracy that potential investors were informed that, pursuant to the aforesaid settlement agreements, the terms thereof were to remain confidential. 3 EFTA01108758  7. It was further part of the conspiracy that potential investors were informed that: the plaintiffs would accept discounted lump-sum payments; the investors would fund the lump-sum payments to the plaintiffs; and, in exchange, potential investors would receive the installment payments due and owing to the plaintiffs under the terms of the negotiated settlement agreements. 8. It was further part of the conspiracy that the potential investors were informed by Rothstein and other co-conspirators that pools of confidential settlement agreements were available for purchase in amounts ranging from hundreds of thousands to millions of dollars. 9. It was further part of the conspiracy that potential investors were told that the amounts due the plaintiffs were paid into trust accounts at TD Bank controlled by Rothstein and RRA, and that said funds would only be utilized to pay the potential investors. 10. It was further part of the conspiracy that, in fact, there were no such plaintiffs who had entered into the above-described confidential settlement agreements. Instead, Rothstein would utilize the funds obtained from potential investors to further the fraudulent scheme by: (a) paying prior investors in the scheme; (b) supplementing and supporting the operation and activities of RRA; (c) distributing lavish gifts, including exotic automobiles, jewelry, boats, loans, cash and bonuses, to partners and employees of RRA and various other individuals in order to engender goodwill and loyalty and to create the appearance of a successful law firm; (d) making large charitable contributions to public and private charitable institutions, including hospitals and other legitimate charitable and nonprofit organizations, in order to deflect any negative scrutiny by the public and/or law enforcement agencies and to create the public impression of altruism and commitment to the community; and (e) creating the appearance of affluence and wealth, by purchasing expensive real and personal property, in order to convince potential investors of the legitimacy of RRA and of the purported investment opportunities. 4 EFTA01108759  Fraudulent Scheme Concerning the Florida Bar II. It was further part of the conspiracy that, in or about April 2009, due to his concern that the demands of the Institutional Investors may cause his fraudulent investment scheme to unravel, and in order to induce the Institutional Investors to continue to invest and to explain the reason that certain payments had not been made, Rothstein falsely informed the Institutional Investors that he was under investigation by the Florida Bar and that the aforesaid trust accounts at TD Bank had been frozen in connection with that investigation. 12. It was further part of the conspiracy that, in or about April 2009, defendant KITTERMAN agreed to pose as the head of the Fort Lauderdale office of the Florida Bar, and, as such, a person who had knowledge of the purported investigation of Rothstein by the Florida Bar. 13. It was further part ofthe conspiracy that Rothstein provided defendant KITTERMAN with a script detailing what she, while she was posing as the head of the Fort Lauderdale office of the Florida Bar, should say during a telephone conversation with the Institutional Investors. That script included the following: (a) that there were 26 complaints from persons represented by Rothstein who were claiming that Rothstein induced them to settle their cases by informing them that he had lump sum advanced funding of their settlements, when he did not; (b) that the actions ofRothstein violated various Rules of Professional Conduct which govern the activities of lawyers who are members of the Florida Bar; (c) that Rothstein faced suspension and possible disbarment for these violations; and (d) that the Institutional Investors "caused part of the problem." 14. It was further part of the conspiracy that, on or about April 22, 2009, defendant KITTERMAN, posing as the head of the Fort Lauderdale office of the Florida Bar, engaged in a telephone conference with a person representing the Institutional Investors and others, during which defendant KITTERMAN falsely claimed, among other things, that Rothstein was facing disciplinary 5 EFTA01108760 action from the Florida Bar due to Rothstein's failure to provide the lump sum advanced funding of the purported settlements, that the trust accounts at TD Bank had been frozen in connection with that investigation, and that the disciplinary action against Rothstein could be resolved if Rothstein's clients were paid the money which they were owed. All in violation of Title 18, United States Code, Section 1349. A TRUE BILL FdREIIERSON 6 EFTA01108761  avu 1 rocrtni Lilo I Mlle I vr tLUKIUH UNITED STATES OF AMERICA CASE NO. vs. CERTIFICATE OF TRIAL ATTORNEY* CHRISTINA M. KITTERMAN, Defendants. Superseding Case Information: Court Division: (seieci one) New Defendant(s) Yes No Number of New Defendants Miami _ Key West Total number of counts FTL WPB FTP I do hereby certify that: 1. I have carefully considered the allegations of the indictment, the number of defendants, the number of probable witnesses and the legal complexities of the Indictment/Information attached hereto. 2. I am aware that the information supplied on this statement will be relied upon by the Judges of this Court in setting their calendars and scheduling criminal trials under the mandate of the Speedy Trial Act, Title 28 U.S.C. Section 3161. 3. Interpreter: (Yes or No) Ai/CD_ List language and/or dialect 4. This case will take _5_ days for the parties to try. 5. Please check appropriate category and type of offense listed below. (Chet& Only One) (Check Of* WIC I 0 to 5 days _IL_ Petty II 6 to 10 days Minor III 11 to 20 days Misdem. IV 21 to 60 days Felony V 61 days and over 6. Has this case been previously filed in this District Court? (Yes or No) Igo_ If yes: Judge: Case No. (Attach copy of dispositive order) Has a complaint been filed in this matter? (Yes or No) Ufa_ If yes: Magistrate Case No. Related Miscellaneous numbers: Defendant(s) in federal custody as of Defendant(s) in state custody as of Rule 20 from the District of Is this a potential death penalty case? (Yes or No) Does this case originate from a matter pending in the Northern Region of the U.S. Attorney's Office prior to October 14, 2003? Yes No 8. Does this case originate from a matter pending in the Central Region of the U.S. Attorneys Office prior to September 1, 2007? ___ Yes >L No SISTANT UNITED STATES ATTORNEY lorida Bar No./Court No. 0305405 'Penalty Sheet(s) attached REV 41&08 EFTA01108762  UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF FLORIDA PENALTY SHEET Defendant's Name: CHRISTINA NI. KITTERMAN Case No: Counts #: 1 18 U.S.C. § 1349; Conspiracy to commit wire fraud * Max.Penalty: 20 years' imprisonment. Count #: * Max.Penalty: EFTA01108763