FOUR ROTHSTEIN ASSOCIATES CHARGED WITH CONSPIRACY TO COMMIT WIRE FRAUD IN CONNECTION WITH PONZI SCHEME
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, John V. Gillies, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, and Rhonda A. Diffenbach, Acting Special Agent in Charge, Internal Revenue Service, Criminal Investigation Division (IRS-CID), announced the filing of charges against Howard Kusnick, 58, of Tamarac, Stephen Caputi, 53, of Lauderhill, William Corte, 38, of Plantation, and Curtis Renie, 38, of Ft. Lauderdale. The defendants are alleged to have conspired to further Scott Rothstein’s fraudulent investment scheme involving the sale of purported confidential settlement agreements in sexual harassment, discrimination, and/or whistle blower suits. Defendants Caputi and Corte are expected to make their initial appearances in federal court in Fort Lauderdale at 11:00 AM today. Defendants Kusnick and Renie are expected to appear in federal court next week.
According to the separate criminal Informations filed with the Court earlier today, these four defendants were associated with Scott Rothstein and the former Fort Lauderdale law firm of Rothstein Rosenfeldt and Adler, P.A. (RRA). Kusnick was an attorney at the RRA firm. Corte and Renie were both employees of RAA’s information technology (IT) department. Caputi, who was an associate of Rothstein, posed as a banker and plaintiff in the fictitious cases offered to investors. The four were charged in three Informations with one count of conspiracy to commit wire fraud, in violation of Title 18, United States Code, Section 371. If convicted, the defendants face a maximum statutory sentence of up to five years in prison.
The Information against Howard Kusnick alleges that, while an attorney at RRA, Kusnick engaged in a scheme to defraud two clients of RRA by authoring a letter purporting to settle pending litigation in the clients’ favor. In fact, however, no such litigation had been instituted and no such settlement existed. Rather, the purpose of 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.
The Information against Stephen Caputi alleges that Caputi at times acted as both a purported banker and plaintiff during meetings with potential investors. For example, the Information alleges that Caputi, posing as an official from TD Bank, provided investors with fraudulent bank statements that reflected purported balances of trust accounts at TD Bank. In this way, Caputi lulled the investors into believing that the account balances were sufficient to fund their investments. On another occasion, Caputi posed as a plaintiff during a meeting with potential investors who had requested to meet with plaintiffs. Caputi pretended to be a plaintiff who had purportedly executed a $10,000,000 settlement agreement, thus raising potential investors’ confidence in the deal.
According to the Information against Curtis Renie and William Corte, these defendants worked at RRA’s IT Department as chief of information technology and as a document management specialist, respectively. Renie and Corte created a fictitious web page copying the legitimate web page of TD Bank. At Rothstein’s direction, the defendants 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 web site 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.
U.S. Attorney Wifredo A. Ferrer stated, “The house of cards supporting Scott Rothstein’s elaborate Ponzi scheme continues to crumble. 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.”
“The FBI will continue to unravel the remaining web of fraudulent schemes created by Scott Rothstein. One thing is clear, Rothstein was able to deceive investors because of the participation by others,” said John V. Gillies, Special Agent in Charge for FBI’s Miami Office. “We will shine a light on every aspect of this fraud. Like Rothstein, those who chose greed over integrity will also have a price to pay.”
IRS Acting Special Agent in Charge Rhonda A. Diffenbach stated, “Those who assist others in perpetrating a crime will be investigated vigorously. IRS-CI will continue to work diligently with our law enforcement partners to protect the public from these crimes.”
Mr. Ferrer commended the investigative efforts of the FBI and the IRS-CID. This case is being prosecuted by Assistant U.S. Attorneys Lawrence D. LaVecchio, Paul F. Schwartz and Jeffrey N. Kaplan.
An Information is only an accusation and a defendant is presumed innocent unless and until proven guilty.
A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.