Rumors are circulating that Scott Rothstein, whose current whereabouts aren't known, spent a marathon 18 hours in talks with federal prosecutors last night and this morning.
Sources say he was not only confessing to his own crimes but pointing the finger at others, including Gov. Charlie Crist, who was so close to Rothstein that he visited his home, dined with him, and attended a party at his wedding last year at the Versace mansion.
One name that might have popped up in those talks: Russell Whitney, a real estate infomercial guru and suspected swindler who was represented by Rothstein for several years.
In 2005 and 2006, the Florida Attorney General's Office was being flooded with complaints by suspected Whitney victims, said a former Rothstein attorney who worked in the firm at the time.
"These weren't a few complaints; there were hundreds," said the attorney, who spoke on the condition of anonymity. "Scott would always take the call from the attorney general's investigator personally, and the complaints would just all get resolved somehow."
At that time, of course, Crist was Florida's attorney general, and Rothstein was pouring money into his campaign for governor and state Republican Party coffers. Whitney himself contributed $1,000 to Crist's gubernatorial campaign in
early 2006. Despite the obvious conflict of interest, Crist accepted the contributions. When it was exposed by the Tampa Tribune that Whitney had contributed the money, Crist returned the contributions. The Rothstein connection wasn't reported at the time.
The attorney who worked for Rothstein at the time suspects, but has no proof, that Rothstein exercised his influence with Crist in the way of campaign cash to get breaks for Whitney in the investigation. But Republican consultant Roger Stone, who worked with Rothstein and had an office in the Rothstein Rosenfeldt Adler firm, doubted it.
Stone said that he was aware of the Whitney case and that he met Whitney during a visit with Rothstein and Rothstein lobbyist Grant Smith to Whitney's house in Fort Myers. But he said Rothstein was ultimately frustrated that his friendship with Crist didn't kill the investigation altogether.
"Rothstein doesn't have any [politicians] to roll on," Stone told me today. "Scott was all about the appearance of influence, not influence itself. There was somebody in the AG's office that Rothstein was working with, and Rothstein got an enormous amount of documentation [regarding Whitney] to this person. But he was extremely disappointed that this attorney general's investigation kept on going despite his efforts."
Stone said he first met Rothstein during a dinner at the Capital Grille at the Galleria Mall in Fort Lauderdale with Crist. He said Crist told him he wanted a fundraiser at Donald Trump's Mar-A-Lago estate in West Palm Beach. Stone said he contacted Trump, whom he had worked with on and off for years on political matters, and set up the fundraiser, which was held on February 3, 2006. Four hundred people arrived, paying $500 a head. Among them was Rothstein and several RRA firm members, Stone said. "Scott broke out his Rolodex for that one," Stone said. "There were several limousines that left the firm for the fundraiser."
One of those people Rothstein called for the Crist fundraiser was Russell Whitney, who attended the Mar-A-Lago affair. Ironically, the Whitney connection to Crist was discovered by the Tampa Tribune as a result of his name being on the guest list. From the 2006 Tribune article:
Whitney operates several companies selling training seminars with such titles as "Wealth Intelligence Super Conference," plus books and products that his Web site says will help average people "build wealth quickly," mainly by investing in real estate.
An initial, three-day training seminar, for example, costs $1,000. Other products cost substantially more.
But in Florida and elsewhere, some consumers have complained.
In response to "complaints from individuals who attended some of the seminars and felt they didn't get what had been promised in the advertising," the attorney general's office opened an investigation last year that is still pending, said JoAnn Carrin, spokeswoman for Crist's office.
The office said Whitney Education Group is cooperating with the investigation.
Whitney's companies have been the subject of similar complaints leading to court orders or to settlement agreements in several other states.
Whitney Education Group Inc. and Whitney Information Network Inc. each gave Crist $500 last June, according to campaign finance reports.
Reports of donations at the Trump fundraiser won't be available until April, but Myrtetus said the campaign checked and found none from Whitney or Shcherban.
A donation was required for admission, she said, but one donor could have brought a guest by giving both a personal contribution and a contribution from a company. Florida law allows corporate political contributions.
Myrtetus said Crist does not know Shcherban and had his photograph taken with hundreds of attendees at the event.
She said Crist met Whitney at a previous fundraiser.
Invitations to the fundraiser were distributed to the e-mail list of Crist's campaign supporters, and hundreds of others were sent out by the campaign finance team, she said.
With some 20,000 donors, she said, it's difficult for the campaign to ensure that no donor is the subject of an investigation by the attorney general's office.
Two interesting points: Whitney had already met Crist prior to the Trump fundraiser, and his attendance required a contribution in his name. It's not known if Rothstein wrote that check. Also, the real Whitney M.O. was to induce people to travel to his seminars in Cape Coral and, once there, get them to buy overpriced houses that he claimed they could flip in 18 months for a giant profit.
The former Rothstein attorney said Rothstein's hope was to get Trump and Whitney to join forces in business. He said Trump balked at the idea.
The big question: Did Whitney get special treatment from state investigators? Well, as the Tribune article says, several states took action against Whitney prior to Florida, where he operated, doing anything. Records show the Attorney General's Office filed a civil suit against Whitney in January of last year claiming fraudulent and illegal business practices. That suit was settled quickly, with Whitney agreeing to pay about a half million in restitution. The SEC has also filed actions Whitney.
Rothstein did more than handle the AG's investigation for Whitney -- he also filed -- or threatened to file -- several pugnacious and ultimately baseless lawsuits on the guru's behalf to scare off critics. One was filed against consumer watchdog John T. Reed for ", whose story you can read here. "I always thought Scott Rothstein was stupid," said Reed, who ultimately settled the suit with Rothstein. "He once wrote me a subpoena to appear in court on the wrong court paper. He was about bluff, bluster, and name-dropping, a fake-it-till-you-make-it bullshit artist. Now people are telling me got a hold of $400 million? How did he find so many rich and stupid people at once?"
Reed said Rothstein took on Whitney as a client in 2003.
Crist, you'll remember, was embroiled in a similar scandal involving close friend and accused criminal Alan Mendelsohn. Mendelsohn, a GOP fundraiser who served as legislative director of the Florida Medical Association, claimed he bribed Crist on behalf of Ponzi schemer Joel Steinger. Mendelsohn, facing federal charges, wore a wire for the FBI to try to prove Crist's involvement through the governor's right-hand man, George LeMieux (now U.S. Sen. LeMieux, thanks to Crist's appointment), but LeMieux didn't bite, and the feds decided that Mendelsohn was lying about Crist's involvement.