So much for the whole "I have not been personally enriched by Scott's activities/quite the contrary" thing Kim Rothstein was claiming outside a courthouse in Fort Lauderdale after her Ponzi-scheming husband pled guilty inside.
Bankruptcy lawyers have learned the government has been allowing Rothstein to not only remain in one ill-gotten (and hideously decorated) McMansion without paying rent, but to collect rent on some of the couple's other million-dollar former properties -- properties that she no longer owns because they were forfeited to the government when Scott Rothstein was criminally charged for his $1.2 billion dollar scam.
"It has recently come to attention," read court filings by attorney Paul Singerman, "that the government has apparently delegated its duty to properly manage and safeguard certain of the property subject to forfeiture to Scott Rothstein's wife.
"More specifically, we have learned that the government has permitted Kimberly Rothstein...to continue to rent out other properties to tenants."
Rothstein apparently alerted creditors' counsel to the situation herself during a deposition on Thursday. She said the government has let some utility bills slide and has failed to secure several of the properties, thereby exposing them to possible deterioration in value.
In other words, she's a consciencious angel fighting the housing market for her country, and happening to live off criminal proceeds on the side. Or something. It's hard to come up with a good reason why, victim though she may be in some ways, and however ill-equipped the government may be as luxury landlords, the feds would continue to let her profit from her husband's illegal activities.
Singerman's filings requested that judges presiding over the separate criminal and bankruptcy cases hold a joint hearing to determine how to best handle the forfeiture and return of as much of the income as possible to victims and creditors.
For some reason -- call him crazy! -- he and others seem to think letting the Ponzi schemer's wife collect it all instead isn't the best plan.
