Former exec at Rothstein law firm gets 10-year sentence for role in $1.2 billion Ponzi schemeBy Curt Anderson, AP
Friday, October 8, 2010
Ex-legal exec gets 10-year sentence in Ponzi scam
FORT LAUDERDALE, Fla. — The former chief operating officer at the law firm run by convicted Ponzi scheme operator Scott Rothstein was sentenced Friday to the maximum 10 years in federal prison for her role in the $1.2 billion fraud.
But Debra Villegas, 43, will probably serve far less time because of her extensive cooperation with prosecutors, who said it was likely they would seek a sentence reduction later. U.S. District Judge William Zloch also took the unusual step of allowing Villegas to remain free until June 24, 2011, so she can assist in the ongoing investigation of the now-defunct Rothstein Rosenfeldt Adler firm.
“One by one, the dominoes in this billion-dollar Ponzi scheme are falling,” said U.S. Attorney Willy Ferrer. “This is not the last to fall.”
Villegas admitted when she pleaded guilty in June to a money laundering conspiracy charge that she helped Rothstein forge signatures on fake legal settlements, which were used to lure investors with false promises of fat profits. But she insisted she only did so because Rothstein told her he was being threatened by Mafia figures if the fraudulent deals didn’t get done.
Villegas attorney Robert Stickney described how Rothstein had helped Villegas and her two teenage sons escape an abusive marriage, eventually giving her a $407,000 house in a gated suburb and a $130,000 Maserati car. Both have since been forfeited to the government and will be sold.
Psychologist Lori Butts, who has been treating Villegas since the Ponzi scheme’s collapse in fall 2009, said Villegas knew she was committing a crime but was loyal to Rothstein — who employed her for 17 years.
“She felt like Mr. Rothstein saved her life and the lives of her children,” Butts testified.
Assistant U.S. Attorney Jeffrey Kaplan, however, said Villegas was key to a fraud that affected hundreds of people who lost some $430 million, most of which is gone forever.
“She really seemed to be the one who was really a central player,” Kaplan said.
In brief remarks to the judge, Villegas expressed remorse and asked for mercy on behalf of her two children. But Zloch was unimpressed.
“Where was the concern for your children when you were engaging in this criminal activity?” he asked.
“My mind was not where it should have been,” Villegas replied.
More arrests are expected in the case, one of the largest fraud schemes ever in South Florida. Rothstein, who is serving a 50-year prison sentence, is also cooperating with investigators. More than $363 million in restitution is owed by Rothstein, Villegas and possibly others.
Villegas’ ex-husband, Tony Villegas, is jailed awaiting trial in the March 2008 slaying of a former Rothstein Rosenfeldt Adler attorney, Melissa Britt Lewis. Prosecutors say Tony Villegas, who has pleaded not guilty, killed Lewis because she was helping Debra Villegas escape their relationship.
Tags: Business And Professional Services, Corporate Crime, Counterfeiting And Forgery, Florida, Fort Lauderdale, Fraud And False Statements, North America, United States