Everybody knew it was going to be a lawyers' bonanza, this Rothstein thing, and now it's confirmed.
I was sent this standard letter to creditors (that particular one went to named creditor Miami metal sculptor Omar Ali) in the Rothstein bankruptcy detailing how much "interim compensation" the lawyers and accountants in the RRA bankruptcy are charging for their work from November 10 through January 31. Here's the list:-- Lead bankruptcy attorney Paul Singerman's firm, Berger Singerman, is asking for a total fee of $1,230,974.50 for those 15 or so weeks of work, plus $28,092.06 in expenses, for a total of more than one and a quarter million dollars.
-- Bankruptcy attorney John Genovese is asking for
$324,805.50 plus $3,659.90 in expenses.
-- Miami accountant Richard A. Pollack is charging $611,640.50 plus $1,846.30 in expenses.
To put those numbers in perspective, consider that, extrapolated over a full year, those three entities would be making more on this one case than the entire 70-member RRA firm made in total revenues last year, about $8 million. A hearing on the fees will be held at 1:30 p.m. April 7 at the federal courthouse.
Don't get me wrong. I'm not claiming any wrongdoing by anyone. The professionals listed above are tops in their field and are believed to be totally aboveboard. It's the system that is flawed. This is just bloated business as usual. Lawyers love it; everybody else knows it stinks but can't do anything about it.
Remember, this is money that is supposed to go to those who lost money in the Rothstein debacle. And this might seem like a true outrage if the shady hedge fund crowd that primarily fed the disbarred lawyer's Ponzi scheme was more sympathetic. A good example of receivership that could make your blood really boil comes in the case of another Ponzi scheme, the case of Joel Steinger's Mutual Benefits Corp. In that fiasco, as I've said here before, you have hard-working elderly folks who lost their life savings -- and the only people who are going to see any sizable amount of what has been recovered are the lawyers, who have turned it into a gold rush while the victims just keep suffering.
-- Spoke with Kim Rothstein's attorney, Scott Saidel, yesterday about the million-dollar clawback lawsuit filed by the lawyers above in the bankruptcy. He told me that he believes the bankruptcy lawyers are just making sure they get whatever federal prosecutors may allow her to keep, like her wedding band and whatever money she may have in her personal savings account.
"I don't fault the bankruptcy attorneys for what they are doing because they are doing their jobs, but you have to wonder at what point it becomes beating a dead horse," Saidel said.
He told me that Kim, who hasn't returned my phone calls on the matter, is troubled by the lawsuit and will likely have to hire a bankruptcy lawyer to represent her. As for her spending, Saidel said she spent no more than other women she met while married to the ultra-wealthy Rothstein.
"She spent money like others in the social group with which she was socializing," Saidel said. "No one in her social group thought her spending was unusual."
-- Former Broward County Commissioner Joe Eggelletion is scheduled to be sentenced today. I did a whole lot of investigating Eggelletion over the years, and a little justice is long overdue. Eggelletion wants 2 1/2 years, but I think he'll be on tap for at least three.
-- Apologies once again to all who were inconvenienced by the blog outage last night. It's been a terrible week technically, but apparently they were working on it last night, and I'm holding out hope that we've got through the worst of it. I've received numerous emails from readers about it, and all I can say is sorry and thanks for caring.
