Kim Rothstein Still Has Hand in Finances, Under Fed's Watch

​Ever since Scott Rothstein's massive Ponzi scheme collapsed, there has been great speculation about whether he stashed any of the money and jewels he amassed away -- and if his wife, Kim, has access to any hidden wealth.

When I posed those questions to Kim Rothstein, she laughed.

"You think Scott wants to be in prison?" she asked. "Whatever it might be, no matter how much money, it's not more important than his freedom."

So what about the lifestyle? Her husband is in prison, and she's still living in the $6.5 million house paid for with Ponzi money, driving an Escalade paid for by the same husband, with the same bodyguard, and a maintenance man who is taking care of her pool and landscaping.

How does she afford it?

"I'm at the mercy of a lot of people," she says. "I don't have all this money, but I don't want to comment on all the financial stuff. They let you keep a bank account. I have my own bank account that I have had since

before I met Scott. I'm not paying the mortgage payment. I don't know what the government is doing. It's in their hands. The government has the house."

She wouldn't say how much was in the account, but she says she also continues to collect rent on the Rothstein properties, or at least the ones that are occupied by tenants. She says that all the money goes into an escrow account and that any payments she makes out of it must be approved by a federal official. The payments include bills connected to the house she still lives in on Isla Bahia Drive.

"I am actively trying to rent out the properties so I can create a fund for the victims," she says. "Out of that fund, I am able to pay basic bills on the properties to keep up their value. I want the properties to get liquidated at the highest value. I don't want the grass to grow too high, I don't want the pools to go green, so I spend a little bit on maintenance, a little bit on the pool guy."

But she says the maintenance man at the home on Isla Bahia, where she continues to live, does his work there "out of the kindness of his heart. He takes care of my pool. He takes care of my trees. He doesn't charge me anything."

Why would the maintenance man be so kind to her?

"Scott took care of a lot of people in the past," she says.

She says her bodyguard, Joe Alu, also doesn't get paid. Alu worked for Rothstein well before the implosion and was a trusted employee. A Delaware company owned by Rothstein, Fifth Court Financial LLC, actually holds the $301,000 note on the Rio Vista Victoria Park home Alu bought in May for $430,000. Alu said he paid the down payment on the house, ran into problems financing it, and Rothstein offered to loan him the money. He said he's made every loan payment before and since Rothstein's collapse. 

Kim also has a couple of lawyers, Scott Saidel on the civil side and criminal attorney Frank Rubino. She says Saidel is a friend who hasn't been paid and whatever work Rubino has done for her was handled by her husband. "I live at the mercy of a lot of people right now," she says. "I've been chanting non-stop. I'm pulling out every belief system I've ever known. Sanskrit, Buddhist teachings, pentagrams."

She stops and laughs at her allusion to Wicca, or witchcraft, which she has practiced since she was a teenager. 

"I want a positive outcome," she says. "I'm at the mercy of the universe."  

She laughs too when she talks about Alu, who with his large muscles, tattoos, and wild graying hair she likens to TV bounty hunter Duane "Dog" Chapman.

"He and I are like a walking TV show," she says. "We're quite the odd pairing. I ask him, 'Do you have to go with me to the grocery store?' He doesn't want people to their aggression out on me."

Kim has good moments and bad ones. When I phoned her Sunday night at her home, she said she was watching the Grammies. And crying.

"Sundays are the hardest part," she said. "The silence is so deafening. Sundays were the only days we had together. He would play the piano and sing to me. He had this amazing voice. Now I wish I was in the Matrix and I could unplug myself and go to to some other planet. I just can't believe this is happening. It's so surreal. Sometimes I don't get out of bed, other times I'm just so angry at what has happened."

She said she didn't believe it was over -- that she thought her husband would somehow "fix it" -- even after the story broke here and the law firm filed for bankruptcy the next day. She said that when her husband left for Morocco he only told her he was going on a business trip.

"I didn't know where he was going or if he was going to New York," she said. "He didn't tell me where he was going. Then he was calling me from a New York number. I was always confused about it. I said to him, 'Everybody here is freaking out, they said you aren't coming home.' He said, 'Relax, I'm coming home. I'm going to fix it.'"

Sure enough, he flew back to Fort Lauderdale in his chartered G5, defying expectations. But he didn't come home. She said that was when she finally realized he really was in big trouble.

"He came back from Morocco and I did not hear from him," she said. "That's when I was like, 'Okay, this is not good.' He still won't talk to me about it. He wants to keep me out of the fray. He's been very tight-lipped about the whole thing."

I asked her if she ever saw her husband with large sums of cash. She laughed and said no. I asked her about safes in the house, she said there were no safes in her current house, but he had one at the law office "and nobody but him had access to that."

She's fighting to keep any pre-Ponzi assets, including her Cadillac Escalade and engagement ring. She received both in 2005, though both were replaced or upgraded later. The feds believe Rothstein started the Ponzi scheme in 2005, though it didn't start going high-volume until Fort Lauderdale businessman George Levin ramped it up in 2008. 

Kim Rothstein lived in the lap of luxury with Rothstein, wearing million-dollar necklaces and hanging out with stars like Bill Cosby and Arnold Schwartzenegger ("He's a character," she said of the California governor. "He's exactly what you think he would be. He was into watches. Scott's into watches. Schwartzenegger is into cigars, Scott's into cigars. He's cool, laid back"). I asked her what she liked best about Rothstein.

"He put his family first. If someone went to the hospital, he would be the first person there," she said. "He loved his family very much. If any of his friends had a problem, he would be there immediately for them. He was extremely territorial, very protective. The best part was knowing that that if anything happened to his family or my family we would get the best medical care. I knew my family would be okay."

Now she doesn't wear any jewelry at all. Much of it was seized by the feds, along with her treasured yacht, Scott's vehicles, and numerous other valuables in the house. 

"I'm not wearing my wedding ring, I'm not interested in wearing anything," she said. "What you wear doesn't define what you are. I don't feel right about wearing anything right now. If I get the okay, based on [the decisions of the federal government], then that's fine, but I'm not out to flaunt it publicly."

And the protection Rothstein seemed to provide is gone. She says everything now is on her shoulders again. The former karate star says she's training in boxing and plans to compete in the sport; Rothstein wouldn't allow her to try it before.

"My house is like a tomb," she says. "I haven't touched anything. I keep everything exactly the way it was. It's like somebody has died and I don't want to put the stuff away."  

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Journalist Bob Norman has been raking the muck of South Florida for the past 25 years. His work has led to criminal cases against corrupt politicians, the ouster of bad judges from the bench, and has garnered dozens of state, regional, and national awards.
Contact: Bob Norman