The Rothstein Effect
Scott Rothstein posed for a lot of pictures, especially with people he thought were important. This was especially true for political leaders, law enforcement officers and celebrities of any kind. If you had the good luck to pose with the alleged Ponzi schemer, then you must head to straight to jail.
At least that is the impression one gets from reading the blogs and comments which have become such an important part of our information system in the 21st century. Names are being thrown around with deplorable lack of taste, even common sense. People who knew Rothstein, from Gov. Charlie Crist to football legend Dan Marino, have been accused of guilt (or gilt) by association. If Rothstein made a contribution to a political campaign, or a charity, that makes the recipient a bad person. Especially if you were seen having a cocktail with him. Or had the misfortune to be a mayor, sheriff or police chief – the kind of people Rothstein sucked up to, or as Churchill might correct, up to which he sucked.
There ought to be a law against such nonsense. In fact there is. It’s called defamation of character, but the Internet tends to ignore the rules which have long governed media conduct. Crist is getting tarred more than most because he is so visible and running for high office. He did go to Rothstein’s wedding. A lot of politicians would, if they had received major contributions. He made the mistake of posing with him. But if he was such a good friend, why was Rothstein not invited to the swearing in ceremony of Sen. George LeMieux in Washington? Certainly Crist would have made sure a good buddy got invited to a function for someone who really is a good buddy. LeMieux’s office confirmed that Rothstein was not invited, although he showed up anyway.
It is interesting that in retrospect people seem to think Rothstein’s illegal (allegedly, of course) conduct was obvious to the world. But keep in mind when several years ago we published our list of most powerful people, nobody even mentioned Rothstein. Yet last year in the same survey, his name came up repeatedly, but usually with a caveat that there was mystery to his sudden wealth. But that’s the point. It was sudden. Certainly in the political world and the legal community, his reputation was questioned. Said a prominent lawyer: “I suspected him a couple years ago. Our firm does pretty well, but there was no way we could have generated the kind of money he was throwing around.”
But the people the money was thrown at did not necessarily know how widespread his largess was. Nor would a politician necessarily know that a suddenly wealthy man was running a Ponzi scheme, especially one based on non-existent lawsuits. There are many people around here who got rich fast. Dot-com millionaires showed up early in the last decade buying huge houses just to have a place to park their yachts. All kinds of legitimately wealthy people arrive in Florida as unknowns. Many prefer to stay that way; others crave the limelight.
Obviously lawyers in his firm, especially those who knew his background, had to know something was wrong. They must have known the business they weren’t doing could not provide such income. But I doubt if many of them thought he was crazy enough to come up with such a scam, and expect to get away with it.
Finally, as posted here before, I don’t recall hearing the name Scott Rothstein until we compiled our powerful list in the spring of 2009. To put that in perspective, I am told I met Wayne Huizenga in the 1970s, when he was quietly building his first fortune in Waste Management. But the name meant nothing to me until Blockbuster and the sports franchises almost 15 years later. And I think I am more typical than not.
Had I known Scott Rothstein was contributing to everything that moved in the last few years, I would have approached him about something for my foundation. I don’t have a foundation, but that would be a good way to start.