Deposition of Scott Rothstein re - Trustee Services
Deposition of Scott Rothstein re - Trustee Services Deposition of Scott Rothstein re - Trustee Services
1 terms that are generally referenced in the e-mail that 2 we were just discussing? 3 A. It does. 4 Q. Other than this promissory note, do you know 5 if there were any other documents that evidence this 6 deal? 7 MR. SALIM: Form. 8 THE WITNESS: I don't know one way or the 9 other. Obviously, other than the e-mail we just 10 looked at. 11 BY MR. GAY: 12 Q. So subsequent to this deal that's 13 represented by the promissory note dated March 19, 14 2007, did you then enter into subsequent deals with 15 Mr. Tonacchio and/or Mr. Lipsitz? 16 A. I did. 17 Q. Tell me a little bit about how that 18 happened. 19 A. I pitched them the Ponzi scheme using the 20 settlement pitch. 21 Q. What did that pitch involve? 22 A. It was an abbreviated version of my 23 full-blown pitch. I don't remember exactly the words 24 I said. I simply explained that was -- the funding of 25 prepaid, meaning money in-house settlement deals where Page 50
1 they could make a lot of money with very little to no 2 risk. 3 Q. Earlier we talked about that there was a 4 difference between the bridge loan scheme and what 5 we've talked about being the settlement agreement 6 related Ponzi scheme, correct? 7 A. Are you saying that all of the promissory 8 notes, the loan deals, that that's what you are 9 referring to as bridge loan notes, bridge loan deals? 10 Q. Well, I'm not actually trying to refer to 11 one group or another, I'm just trying to ask you if 12 there was a scheme regarding bridge loans that was 13 separate and apart from the settlement agreement 14 related Ponzi to sort of differentiate what that 15 involved. 16 MR. SALIM: Form. 17 THE WITNESS: There were some deals that 18 were pitched to a variety of investors as bridge 19 loans, to clients and other business people. There 20 were some deals that were pitched as the settlement 21 deals, but that were what I call minimal paper. 22 There were promissory notes alone or 23 promissory notes in an e-mail alone and then there 24 was the full-blown packets. To the best of my 25 recollection, the deals that were pitched and Page 51
- Page 1 and 2: 1 UNITED STATES DISTRICT COURT FOR
- Page 3 and 4: 1 ALSO PRESENT: 2 Domenick Tonacchi
- Page 5 and 6: 1 MR. LIPSITZ: Barry Lipsitz. Page
- Page 7 and 8: 1 A. That's correct. Page 7 2 Q. Ma
- Page 9 and 10: 1 first had a home just off of A1A
- Page 11 and 12: 1 A. It was an investment vehicle.
- Page 13 and 14: 1 where Mr. Lipsitz was there. Othe
- Page 15 and 16: 1 A. Yes, it's certainly possible.
- Page 17 and 18: 1 establishment? Page 17 2 A. A han
- Page 19 and 20: 1 Q. Who else would have accompanie
- Page 21 and 22: 1 private jet with Mr. Lipsitz? Pag
- Page 23 and 24: 1 Q. And this is an e-mail in June
- Page 25 and 26: 1 Q. Okay. If you see the text of t
- Page 27 and 28: 1 went to that graduation party? Pa
- Page 29 and 30: 1 to name the people? Page 29 2 MR.
- Page 31 and 32: 1 of them was there. Page 31 2 Q. W
- Page 33 and 34: 1 A. I do. Page 33 2 Q. Is that pho
- Page 35 and 36: 1 they are. Page 35 2 Q. You never
- Page 37 and 38: 1 watch for Mr. Tonacchio? Page 37
- Page 39 and 40: 1 Q. So if Mr. Lipsitz previously t
- Page 41 and 42: 1 THE WITNESS: If you could show me
- Page 43 and 44: 1 lie. Page 43 2 Q. It would have b
- Page 45 and 46: 1 to mean additional money over and
- Page 47 and 48: 1 risk. Page 47 2 MR. PHILLIPS: Obj
- Page 49: 1 very long period of time. Page 49
- Page 53 and 54: 1 in reference to the Picou loan? P
- Page 55 and 56: 1 e-mail that goes with this specif
- Page 57 and 58: 1 explain that to me? Page 57 2 A.
- Page 59 and 60: 1 BY MR. GAY: Page 59 2 Q. And look
- Page 61 and 62: 1 excuse me. "Late payment penalty
- Page 63 and 64: 1 Q. But you would refer to each of
- Page 65 and 66: 1 determine whether or not a specif
- Page 67 and 68: 1 Morse and the Levys. Was there an
- Page 69 and 70: 1 A. You know, I don't recall speci
- Page 71 and 72: 1 Q. If you'd look at Document 0022
- Page 73 and 74: 1 A. Yes. Page 73 2 Q. That's an e-
- Page 75 and 76: 1 and it says an hour or less. Page
- Page 77 and 78: 1 Q. So when you generally refer to
- Page 79 and 80: 1 A. Yes, sir. Page 79 2 Q. So acco
- Page 81 and 82: 1 it says, "It was great getting to
- Page 83 and 84: 1 THE WITNESS: I don't. I don't hav
- Page 85 and 86: 1 e-mail, no, sir. Page 85 2 Q. Loo
- Page 87 and 88: 1 then when I finally did have the
- Page 89 and 90: 1 construction loan or something of
- Page 91 and 92: 1 A. I do. Page 91 2 Q. About the m
- Page 93 and 94: 1 couldn't decipher what was being
- Page 95 and 96: 1 A. I do. Page 95 2 Q. George who?
- Page 97 and 98: 1 BY MR. GAY: Page 97 2 Q. A few mo
- Page 99 and 100: 1 MR. PHILLIPS: Same. Page 99 2 THE
1 terms that a<strong>re</strong> generally <strong>re</strong>fe<strong>re</strong>nced in the e-mail that<br />
2 we we<strong>re</strong> just discussing?<br />
3 A. It does.<br />
4 Q. Other than this promissory note, do you know<br />
5 if the<strong>re</strong> we<strong>re</strong> any other documents that evidence this<br />
6 deal?<br />
7 MR. SALIM: Form.<br />
8 THE WITNESS: I don't know one way or the<br />
9 other. Obviously, other than the e-mail we just<br />
10 looked at.<br />
11 BY MR. GAY:<br />
12 Q. So subsequent to this deal that's<br />
13 <strong>re</strong>p<strong>re</strong>sented by the promissory note dated March 19,<br />
14 2007, did you then enter into subsequent deals with<br />
15 Mr. Tonacchio and/or Mr. Lipsitz?<br />
16 A. I did.<br />
17 Q. Tell me a little bit about how that<br />
18 happened.<br />
19 A. I pitched them the Ponzi scheme using the<br />
20 settlement pitch.<br />
21 Q. What did that pitch involve?<br />
22 A. It was an abb<strong>re</strong>viated version <strong>of</strong> my<br />
23 full-blown pitch. I don't <strong>re</strong>member exactly the words<br />
24 I said. I simply explained that was -- the funding <strong>of</strong><br />
25 p<strong>re</strong>paid, meaning money in-house settlement deals whe<strong>re</strong><br />
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