The feds have admitted that Ponzi-schemer extraordinaire Scott Rothstein has been singing like a bird, but now it's a bit too much.
Prosecutors from the U.S. Attorney's office entered an objection to a ruling made by a U.S. bankruptcy judge ordering the return of Rothstein to Fort Lauderdale for a deposition in front of creditors owed money by his now-defunct law firm.
The prosecutors' objection is that the feds are working on a multiperson indictment involving several of Rothstein's old Ponzi pals, and they're afraid Rothstein would tip off the suspects during his deposition.
"It is anticipated that an additional multi-defendant indictment will be forthcoming," the prosecutors write in Fridays' filing. "It is difficult to predict with exactitude when the proposed indictment will be returned, but such indictment is anticipated within the next six months."
Prosecutors ask that Judge Raymond B. Ray postpone the date for Rothstein's deposition by 180 days, by which time Rothstein's co-conspirators would be indicted.
The main setback in new prosecution, the feds say, is that they're still combing through around 850,000 emails seized from computers at the Rothstein Rosenfeldt Adler law firm.
"Unlike the computers of a typical business, the seizure of computers from a law firm by government agents requires an extensive review by a separate team of government agents and attorneys in order to prevent the prosecutors and investigating agents from viewing any attorney-client information," prosecutors write. "Teams of law enforcement agents have been reviewing these e-mails to determine whether any attorney-client privileges exist which would mandate those e-mails being quarantined from the prosecution team."
The feds say Rothstein still continues to provide them with information about his own criminal activity and the alleged crimes of others -- which he's been doing since November 2009.
They're still looking through "hundreds of thousands of pages" worth of documents and say it's "difficult to predict with exactitude" when the next indictment will be returned.
In the meantime, the feds don't want Rothstein -- "the main repository of information" -- talking to anyone but them.
"If defendant Rothstein were to be deposed, at the present time, it is feared that such corraborating evidence could be concealed, altered or destroyed," prosecutors write. "Rothstein's deposition would provide a detailed explanation of the criminal activities of coconspirators. Such information would alert targets of the investigation as to the specifics concerning their potential criminal liability and would potentially reveal to them the identities of other witnesses against them."
The feds' attempt to block Rothstein's deposition is scheduled to be heard on July 1 before U.S. District Judge James Cohn.
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