TD Bank just won a victory before Judge Marra in federal district court. Judge Marra ruled TD Bank has the right to have a jury trial conducted in the district court, not the bankruptcy court, because it did not consent to a bankruptcy court jury trial.
The only question is if they want to go before a jury ... and I don't only mean TD Bank. The elephant in the room throughout the whole Scott Rothstein bankruptcy is that Berger Singerman insiders, including Paul Singerman, partnered with Rothstein to buy Gibraltar Bank, arguably a bank more important to Rothstein's schemes then TD Bank.
Clearly, Berger Singerman insiders are presumed to have inside knowledge of Rothstein's scheme — through due dilligence and similar efforts used in evaluating their Gibraltar investment and their partner, Rothstein, who they were investing with.
At the time of the purchase all the warning signs were in place, including the many internal complaints about Rothstein's accounts. Rothstein has already testified that the key reason for his investing in Gibraltar Bank was to block all internal investigations of his accounts.
The conflict problem — so the public was informed and it was dutifully reported — was "solved" by hiring another law firm to sue Gibraltar. The problem then disappeared from public view, as "solved."
But, the conflict problem was never solved because Gibraltar played a central role in the Ponzi scheme. Berger Singerman had retained such a degree of control over the bankruptcy estate that Paul Singerman negotiated the sweetheart Gibraltar bankruptcy settlement that immunizes Gibraltar from other claims by Rothstein's victims — and protects Berger Singerman insiders' investment in Gibraltar.
The ploy of hiring another firm to give the appearance of a "solved" conflict, worked very well indeed.
TD Bank's "Best Defense" - What Happened To The In Pari Delicto Defense ... It Worked In The Madoff Case?
It is so far very strange that the issue of "in pari delicto" has not yet hit any headlines in this case (See my previous post on this subject). Remember, that well settled defense theory says, in essence, that if two parties work together on a scheme, then one of those schemers (in this case the bankruptcy estate) cannot sue third parties on behalf of innocent victims.
To make the in pari delicto concept clearer: picture two muggers assaulting a victim. One of the muggers sues another alleged accomplice to the mugging to compensate the victim. The sued alleged accomplice raises the in pari delicto defense claiming an accomplice cannot sue him to compensate the victim.
This very important defense issue, a few days ago, became the subject of an appeal in the Second Circuit in the Bernie Madoff bankruptcy case. The appeal came after two Madoff bankruptcy trustee lawsuits against financial institutions were thrown out based on the in pari delicto defense. Those cases parallel the Scott Rothstein case against TD Bank.
Everyone following the Scott Rothstein bankruptcy case should recognize what is really happening:
Berger Singerman is making many quick "pennies on the dollar" settlements. Those paltry settlements all have buried clauses that immunize the targets from victim lawsuits — the real "carrot" to settle. A large part of those paltry settlements then go to Berger Singerman for legal fees — and Berger Singerman is thereby able to protect themselves (and friends) from many embarrassing questions and potential civil claims, including aiding and abetting and civil RICO claims, regarding Gibraltar.
Friday, March 9, 2012
Thursday, March 1, 2012
Raj Rajaratnam Convicted ... But Local Bankruptcy Insiders Helped Bear Stearns — the "Big One" — Get Away
No conviction could have been simpler to obtain than one for the theft of massive amounts of wiretap information and other protected law enforcement materials ... that was engineered, for Bear Stearns benefit, by local bankruptcy insiders and Bear Stearns senior management.
Convictions of senior Bear Stearns managing directors Mark Lehman and Daniel Taub would have been so simple. And, through the leverage of Bear Stearns senior management facing long prison terms, have led to a successful outcome — instead of the notorious botched result — in the Bear Stearns Cayman Islands CMO Hedge Fund trial ... a trial that otherwise had to rely on ambiguous emails.
In 2006, Paul S. Singerman of Berger Singerman confessed to being instrumental in funneling a flood of illegal wiretap results and other extensive protected law enforcement materials (he euphemistically termed "discovery") to Bear Stearns:
"one of the purposes of Title Ill is to prevent unlawful communications intercepts being used for "private financial gain" .... Sharing the contents of the discovery ... with Lawrence's largest creditor— Bear Stearns & Co. ... was entirely appropriate so that they could determine what, if anything, in the discovery obtained might be useful to them"
The open and shut simplicity of a prosecution of Bear Stearns senior management — for serious violations of federal wiretap law — would have prevented Bear Stearns' later 30 billion dollar sale of worthless CMO's from their Cayman Islands hedge funds to the U.S. taxpayer. That sale would have been politically impossible.
From late 2004 on, even before Paul S. Singerman's confession was made, I had filed extensive documentation, including hidden bills, that plainly showed the thefts were routinely occurring. The documentation showed how Bear Stearns was regularly funneled the massive amount law enforcement material they were illegally receiving. It was that documentation then led to the confession by Mr. Singerman in court papers.
A successful prosecution of Bear Stearns insiders was a much simpler matter than the Raj Rajaratnam conviction — itself, the Wall Street Journal identified as having a "simple" prosecution theory as the reason for its success — because the theory was basic and so easy to prove since a confession already existed.
The means to convict senior Bear Stearns management had been filed (and sent to the local U.S. Attorney's Office in Florida) in more than enough time to prevent the greatest con in US financial history: the 30 billion dollar sale of worthless CMO's held in Bear Stearns' Cayman Islands hedge funds — the very CMO's Bear Stearns insiders made billions creating — to the US taxpayer.
This far dwarfed the 20 million dollar insider case of Raj Rajaratnam.
Of course there is much more to this story, as hinted at in the Paul Singerman confession. Particularly the strange manner, theories, and events by which the illegal wiretapping was obtained and justified. All of these matters, presenting a far different picture than previously publicized about the longest civil contempt case in US federal court history, has begun to be fully documented in this blog.
Confession by Paul S. Singerman that Bear Stearns illegally obtained federal law enforcement tapes
Convictions of senior Bear Stearns managing directors Mark Lehman and Daniel Taub would have been so simple. And, through the leverage of Bear Stearns senior management facing long prison terms, have led to a successful outcome — instead of the notorious botched result — in the Bear Stearns Cayman Islands CMO Hedge Fund trial ... a trial that otherwise had to rely on ambiguous emails.
In 2006, Paul S. Singerman of Berger Singerman confessed to being instrumental in funneling a flood of illegal wiretap results and other extensive protected law enforcement materials (he euphemistically termed "discovery") to Bear Stearns:
"one of the purposes of Title Ill is to prevent unlawful communications intercepts being used for "private financial gain" .... Sharing the contents of the discovery ... with Lawrence's largest creditor— Bear Stearns & Co. ... was entirely appropriate so that they could determine what, if anything, in the discovery obtained might be useful to them"
The open and shut simplicity of a prosecution of Bear Stearns senior management — for serious violations of federal wiretap law — would have prevented Bear Stearns' later 30 billion dollar sale of worthless CMO's from their Cayman Islands hedge funds to the U.S. taxpayer. That sale would have been politically impossible.
From late 2004 on, even before Paul S. Singerman's confession was made, I had filed extensive documentation, including hidden bills, that plainly showed the thefts were routinely occurring. The documentation showed how Bear Stearns was regularly funneled the massive amount law enforcement material they were illegally receiving. It was that documentation then led to the confession by Mr. Singerman in court papers.
A successful prosecution of Bear Stearns insiders was a much simpler matter than the Raj Rajaratnam conviction — itself, the Wall Street Journal identified as having a "simple" prosecution theory as the reason for its success — because the theory was basic and so easy to prove since a confession already existed.
The means to convict senior Bear Stearns management had been filed (and sent to the local U.S. Attorney's Office in Florida) in more than enough time to prevent the greatest con in US financial history: the 30 billion dollar sale of worthless CMO's held in Bear Stearns' Cayman Islands hedge funds — the very CMO's Bear Stearns insiders made billions creating — to the US taxpayer.
This far dwarfed the 20 million dollar insider case of Raj Rajaratnam.
Of course there is much more to this story, as hinted at in the Paul Singerman confession. Particularly the strange manner, theories, and events by which the illegal wiretapping was obtained and justified. All of these matters, presenting a far different picture than previously publicized about the longest civil contempt case in US federal court history, has begun to be fully documented in this blog.
Confession by Paul S. Singerman that Bear Stearns illegally obtained federal law enforcement tapes
Wednesday, February 29, 2012
Scott Rothstein Redux 4: - What's Behind the Razorback Gibraltar Settlement; More Trojan Horses in the Bankruptcy Gibraltar Settlement
Rothstein victims must surely believe they are being forced to own the equivalent of underwater Florida swamp land — toxically polluted to boot — in the form of the "50 million" in Gibraltar Bank insurance claims forced on them in the pending Gibraltar bankruptcy settlement. The insurance claims are virtually worthless and the Razorback settlement neatly avoided the Trojan horses inserted into the bankruptcy settlement.
The largest Trojan horse in the bankruptcy Gibraltar "settlement" is, of course, the blanket waiver protecting from lawsuits all Gibraltar related targets — the real deep pockets for Rothstein victim recovery:
Deep pocket recovery targets include: Berger Singerman honchos (and Berger Singerman itself — the bankruptcy powerhouse controlling the trustee's bankruptcy case) who partnered with Scott Rothstein to buy Gibraltar, their still unidentified Florida "movers and shakers" purchase partners — who are also possible criminal targets — , Boston Private and other sundry parties associated with the purchase and running of Gibraltar. Berger Singerman's "claims waiver" provision in the bankruptcy settlement protects them all.
The real reasons the Razorback settlement was only for 10 million:
Gibraltar Bank is a "zombie bank." It's dead ... but walking. Barely.
Razorback plaintiffs know it is worthless win jury awards of potentially up to 1/2 billion dollars (based on recent the TD Bank results) because Gibraltar will immediately fold. Gibraltar is basically a shell with no equity left after depositor claims, the FDIC steps in, and the true value of its enormous loan portfolio is disclosed. Gibraltar was in deep financial trouble (and under investigation for money laundering for which it was ultimately cited) even before Rothstein liability became clear.
That is why the Gibraltar "claims waiver" provision in the bankruptcy "settlement" is so large a Trojan horse. Only deep pocket targets — Berger Singerman honchos, their unknown Gibraltar purchase partners, Boston Private and others — can cover even part of Gibraltar's liability. But they all escape liability because of the tainted provision.
To further understand: picture a piranha (Razorback) leading a pack attacking the "deep in the water" "zombie bank" (Gibraltar). It must pick the size of its bite very carefully. It must make sure the "zombie bank" still appears to be "walking" after the bite, otherwise, it chokes and must regurgitate the chunk when the FDIC steps in.
In reality, Gibraltar Bank is "owned" by: 1) depositors (most of whom are largely uncovered by FDIC insurance because Gibraltar specializes in "wealth management"), and 2) Scott Rothstein's victims.
Gibraltar's true value is 100's of millions less than the money "due" these two groups. So Berger Singerman honchos and the other Scott Rothstein purchase partners lost their equity long ago.
Even without the 100's of millions in Rothstein victim liability, Gibraltar was is serious trouble because of chronic over reporting of bank loan asset values (a nationwide problem) and financial and loan problems, unique to Gibraltar, that have been regularly occurring as "surprises."
The hidden bankruptcy chess game — Gibraltar's stealth receivership:
In effect, Gibraltar Bank's future is being decided now through a stealth receivership, in which there are four party groups: 1) depositors (eventually represented in part by the FDIC) (creditors); 2) Rothstein victims (creditors); 3) insurers (targets); and 4) Scott Rothstein's purchase partners (include Berger Singerman honchos) and still unknown others, Boston Private and others (targets).
Berger Singerman, through control of the Rothstein bankruptcy, is using all of their considerable bankruptcy insider power and influence to assure the fourth group (including themselves) is completely removed as targets in a later receivership. The fourth group is the largest potential recovery group. The tainted bankruptcy settlement clause, baring all claims against Gibraltar related targets, accomplishes Berger Singerman's goal.
How the Razorback group avoided other Trojan Horses in the bankruptcy Gibraltar settlement:
The real value of the Gibraltar insurance claims can be seen just by looking at the principal insurance carrier defenses: Gibraltar lied in its insurance applications; Gibraltar management knew, or should have known, a massive Rothstein fraud was occurring and concealed that information in their insurance applications, which invalidated coverage.
If the carrier defenses looks familiar, they should be. They are similar to the Rothstein victims' strong claims against Gibraltar Bank.
In light of the explosive testimony recently given by Scott Rothstein, an active insurer defense exposes Gibraltar management and others to exposure of information relevant to further possible civil and/or criminal claims.
So, Gibraltar has good reason to dump their insurance claims — and the legal costs to pursue those claims — on the backs of the Rothstein victims, as specified in the tainted bankruptcy settlement. The Razorback plaintiffs did not fall into this trap. Gibraltar must pursue their own insurer claims in the Razorback settlement.
By assigning the insurance claims to the bankruptcy estate, those claims will be then controlled by Berger Singerman, who will collect legal fees from the victims (not from Gibraltar) to pursue those claims while keeping tabs on exactly what information is disclosed.
For their part, the insurers will have the silent advantage of knowing of Berger Singerman reluctance to have information harmful to them disclosed at trial and use that information to reduce even the minimal expected recovery. A cynic would predict: there will be no trial, only a sealed "settlement" after a suitable period of fee "milking" has occurred.
Equally important, the bankruptcy "settlement" means Gibraltar (and its insiders) turn the tables on the victims by forcing them to repudiate their position of Gibraltar wrongdoing. The victims must now vigorously defend Gibraltar management and bankruptcy insider shareholders — their alleged victimizers — to recover any losses from the carriers.
Rothstein victims can certainly be excused for believing that forcing them pay millions in legal fees to defend Gibraltar management and Berger Singerman honchos' Gibraltar actions — that they allege resulted in defrauding them — is adding insult to injury by, yet again, victimizing them.
The next post will tie together the issue of claims against Gibraltar insiders, show why they are primary targets for recovery and point out some unexplored areas that require further investigation.
The largest Trojan horse in the bankruptcy Gibraltar "settlement" is, of course, the blanket waiver protecting from lawsuits all Gibraltar related targets — the real deep pockets for Rothstein victim recovery:
Deep pocket recovery targets include: Berger Singerman honchos (and Berger Singerman itself — the bankruptcy powerhouse controlling the trustee's bankruptcy case) who partnered with Scott Rothstein to buy Gibraltar, their still unidentified Florida "movers and shakers" purchase partners — who are also possible criminal targets — , Boston Private and other sundry parties associated with the purchase and running of Gibraltar. Berger Singerman's "claims waiver" provision in the bankruptcy settlement protects them all.
The real reasons the Razorback settlement was only for 10 million:
Gibraltar Bank is a "zombie bank." It's dead ... but walking. Barely.
Razorback plaintiffs know it is worthless win jury awards of potentially up to 1/2 billion dollars (based on recent the TD Bank results) because Gibraltar will immediately fold. Gibraltar is basically a shell with no equity left after depositor claims, the FDIC steps in, and the true value of its enormous loan portfolio is disclosed. Gibraltar was in deep financial trouble (and under investigation for money laundering for which it was ultimately cited) even before Rothstein liability became clear.
That is why the Gibraltar "claims waiver" provision in the bankruptcy "settlement" is so large a Trojan horse. Only deep pocket targets — Berger Singerman honchos, their unknown Gibraltar purchase partners, Boston Private and others — can cover even part of Gibraltar's liability. But they all escape liability because of the tainted provision.
To further understand: picture a piranha (Razorback) leading a pack attacking the "deep in the water" "zombie bank" (Gibraltar). It must pick the size of its bite very carefully. It must make sure the "zombie bank" still appears to be "walking" after the bite, otherwise, it chokes and must regurgitate the chunk when the FDIC steps in.
In reality, Gibraltar Bank is "owned" by: 1) depositors (most of whom are largely uncovered by FDIC insurance because Gibraltar specializes in "wealth management"), and 2) Scott Rothstein's victims.
Gibraltar's true value is 100's of millions less than the money "due" these two groups. So Berger Singerman honchos and the other Scott Rothstein purchase partners lost their equity long ago.
Even without the 100's of millions in Rothstein victim liability, Gibraltar was is serious trouble because of chronic over reporting of bank loan asset values (a nationwide problem) and financial and loan problems, unique to Gibraltar, that have been regularly occurring as "surprises."
The hidden bankruptcy chess game — Gibraltar's stealth receivership:
In effect, Gibraltar Bank's future is being decided now through a stealth receivership, in which there are four party groups: 1) depositors (eventually represented in part by the FDIC) (creditors); 2) Rothstein victims (creditors); 3) insurers (targets); and 4) Scott Rothstein's purchase partners (include Berger Singerman honchos) and still unknown others, Boston Private and others (targets).
Berger Singerman, through control of the Rothstein bankruptcy, is using all of their considerable bankruptcy insider power and influence to assure the fourth group (including themselves) is completely removed as targets in a later receivership. The fourth group is the largest potential recovery group. The tainted bankruptcy settlement clause, baring all claims against Gibraltar related targets, accomplishes Berger Singerman's goal.
How the Razorback group avoided other Trojan Horses in the bankruptcy Gibraltar settlement:
The real value of the Gibraltar insurance claims can be seen just by looking at the principal insurance carrier defenses: Gibraltar lied in its insurance applications; Gibraltar management knew, or should have known, a massive Rothstein fraud was occurring and concealed that information in their insurance applications, which invalidated coverage.
If the carrier defenses looks familiar, they should be. They are similar to the Rothstein victims' strong claims against Gibraltar Bank.
In light of the explosive testimony recently given by Scott Rothstein, an active insurer defense exposes Gibraltar management and others to exposure of information relevant to further possible civil and/or criminal claims.
So, Gibraltar has good reason to dump their insurance claims — and the legal costs to pursue those claims — on the backs of the Rothstein victims, as specified in the tainted bankruptcy settlement. The Razorback plaintiffs did not fall into this trap. Gibraltar must pursue their own insurer claims in the Razorback settlement.
By assigning the insurance claims to the bankruptcy estate, those claims will be then controlled by Berger Singerman, who will collect legal fees from the victims (not from Gibraltar) to pursue those claims while keeping tabs on exactly what information is disclosed.
For their part, the insurers will have the silent advantage of knowing of Berger Singerman reluctance to have information harmful to them disclosed at trial and use that information to reduce even the minimal expected recovery. A cynic would predict: there will be no trial, only a sealed "settlement" after a suitable period of fee "milking" has occurred.
Equally important, the bankruptcy "settlement" means Gibraltar (and its insiders) turn the tables on the victims by forcing them to repudiate their position of Gibraltar wrongdoing. The victims must now vigorously defend Gibraltar management and bankruptcy insider shareholders — their alleged victimizers — to recover any losses from the carriers.
Rothstein victims can certainly be excused for believing that forcing them pay millions in legal fees to defend Gibraltar management and Berger Singerman honchos' Gibraltar actions — that they allege resulted in defrauding them — is adding insult to injury by, yet again, victimizing them.
The next post will tie together the issue of claims against Gibraltar insiders, show why they are primary targets for recovery and point out some unexplored areas that require further investigation.
Monday, February 27, 2012
Scott Rothstein Redux Part 3: - The Trojan Horses in the Gibraltar Bank "Settlement"
The quick foxes are amok in the chicken coop — or similar such thoughts — must be in the minds of the Rothstein victims who actually read the terms of the tainted Rothstein - Gibraltar Bank bankruptcy "settlement."
Rothstein victims have so far recovered 1/4 billion dollars from TD Bank — 67 million from a recent jury award and from a reported settlement of 170 million. There is more to come.
Recovery from Gibraltar Bank could easily be 1/2 billion dollars ... without the tainted bankruptcy "settlement," because the Rothstein victims' case against Gibraltar Bank is stronger than the case against TD Bank (see below).
Yet, the bankruptcy "settlement" only costs Gibraltar a few million dollars (see previous post) and bars Rothstein victims from any greater recovery from Gibraltar!
The "settlement" enriches the head honchos of local bankruptcy power house Berger Singerman, including Paul Singerman, by protecting their many millions invested in Gibraltar as partners (co-shareholders) with Scott Rothstein. Berger Singerman, as lead attorneys for the bankruptcy estate, for all practical purposes control the bankruptcy estate. Furthermore, public reports about the "settlement" have ignored the similar protection given to the unidentified 50.
Who or what is the 50? It isn't a movie. They are the unidentified 50 Florida "movers and shakers" who partnered with Berger Singerman honchos and Scott Rothstein to buy control of Gibraltar. Entry into that exalted inner circle implied very close personal and/or business relationships with Berger Singerman honchos and Rothstein because the investment was a private placement. The investment was made with great secrecy and a deliberate concealment of the identities of the 50. The reasons for concealing the identities of the 50 are now very clear.
The SunSentinal reported Rothstein testified: "We were involved in public corruption with law enforcement. We were involved in activities with mob-related individuals. We were involved in activities involving the physical threats of other individuals. We were involved in the public corruption side of purchasing of political positions. We were involved in the manipulation of the judiciary."
Surprisingly, reporters have made no attempt to identify the 50 ... a list that is a "brass ring" goal for investigative reporting. The list will reveals who Rothstein may have been referring to in his explosive testimony. Floridians have a right to know which officials and/or prominent individuals were in bed with Rothstein.
Moreover, as things now stand, the unidentified 50 — which likely includes public officials — owe Paul Singerman, and the other unidentified Berger Singerman honcho Gibraltar owners, a great debt (presumably to be later paid back) for protecting their Gibraltar investments and their identities.
The case against Gibraltar is stronger than the case against TD Bank:
The essence of the recently won jury case against TD Bank was straightforward. A short summary of the case was that TD Bank knew of the Scott Rothstein fraud because of the fraud's size, its longevity and normal banking controls raised many red flags that TD Bank should have reacted to; all of the signs were there for TD Bank to see a massive fraud was occurring; it is impossible to believe that TD Bank official didn't know of the fraud but allowed it to continue because it was profitable to do so. See Business Week article TD Bank Aided Rothstein Fraud, Investors’ Lawyer Tells Jury
The case against Gibraltar is stronger than that against TD Bank because Berger Singerman honchos and Paul Singerman were multi million dollar investors in Gibraltar. The victims, at trial, would argue that it is impossible for Gibraltar management and owners to not have been aware of Rothstein's schemes — more so than TD Bank — because Berger Singerman is a local bankruptcy power house firm that claims to have extensive experience in uncovering complex financial frauds. They would argue that it is impossible to believe Berger Singerman, with their extensive "expertise" in ferreting out complex financial fraud, did not see the warning signs of the massive Rothstein fraud when they conducted due diligence for their multi million dollar Gibraltar investments. In addition, the government has cited Gibraltar Bank for extensive money laundering violations. These arguments would carry great weight with a jury and it is not unreasonable to project awards of upwards of 1/2 billion dollars against Gibraltar in light of the TD Bank verdict and settlement.
See the next post for the undisclosed and extraordinary hidden "Trojan horses" that are contained in the tainted bankruptcy Rothstein - Gibraltar settlement. Those Trojan horses further benefit and protect Berger Singerman honchos ... at the further great expense of the Rothstein victims.
Rothstein victims have so far recovered 1/4 billion dollars from TD Bank — 67 million from a recent jury award and from a reported settlement of 170 million. There is more to come.
Recovery from Gibraltar Bank could easily be 1/2 billion dollars ... without the tainted bankruptcy "settlement," because the Rothstein victims' case against Gibraltar Bank is stronger than the case against TD Bank (see below).
Yet, the bankruptcy "settlement" only costs Gibraltar a few million dollars (see previous post) and bars Rothstein victims from any greater recovery from Gibraltar!
The "settlement" enriches the head honchos of local bankruptcy power house Berger Singerman, including Paul Singerman, by protecting their many millions invested in Gibraltar as partners (co-shareholders) with Scott Rothstein. Berger Singerman, as lead attorneys for the bankruptcy estate, for all practical purposes control the bankruptcy estate. Furthermore, public reports about the "settlement" have ignored the similar protection given to the unidentified 50.
Who or what is the 50? It isn't a movie. They are the unidentified 50 Florida "movers and shakers" who partnered with Berger Singerman honchos and Scott Rothstein to buy control of Gibraltar. Entry into that exalted inner circle implied very close personal and/or business relationships with Berger Singerman honchos and Rothstein because the investment was a private placement. The investment was made with great secrecy and a deliberate concealment of the identities of the 50. The reasons for concealing the identities of the 50 are now very clear.
The SunSentinal reported Rothstein testified: "We were involved in public corruption with law enforcement. We were involved in activities with mob-related individuals. We were involved in activities involving the physical threats of other individuals. We were involved in the public corruption side of purchasing of political positions. We were involved in the manipulation of the judiciary."
Surprisingly, reporters have made no attempt to identify the 50 ... a list that is a "brass ring" goal for investigative reporting. The list will reveals who Rothstein may have been referring to in his explosive testimony. Floridians have a right to know which officials and/or prominent individuals were in bed with Rothstein.
Moreover, as things now stand, the unidentified 50 — which likely includes public officials — owe Paul Singerman, and the other unidentified Berger Singerman honcho Gibraltar owners, a great debt (presumably to be later paid back) for protecting their Gibraltar investments and their identities.
The case against Gibraltar is stronger than the case against TD Bank:
The essence of the recently won jury case against TD Bank was straightforward. A short summary of the case was that TD Bank knew of the Scott Rothstein fraud because of the fraud's size, its longevity and normal banking controls raised many red flags that TD Bank should have reacted to; all of the signs were there for TD Bank to see a massive fraud was occurring; it is impossible to believe that TD Bank official didn't know of the fraud but allowed it to continue because it was profitable to do so. See Business Week article TD Bank Aided Rothstein Fraud, Investors’ Lawyer Tells Jury
The case against Gibraltar is stronger than that against TD Bank because Berger Singerman honchos and Paul Singerman were multi million dollar investors in Gibraltar. The victims, at trial, would argue that it is impossible for Gibraltar management and owners to not have been aware of Rothstein's schemes — more so than TD Bank — because Berger Singerman is a local bankruptcy power house firm that claims to have extensive experience in uncovering complex financial frauds. They would argue that it is impossible to believe Berger Singerman, with their extensive "expertise" in ferreting out complex financial fraud, did not see the warning signs of the massive Rothstein fraud when they conducted due diligence for their multi million dollar Gibraltar investments. In addition, the government has cited Gibraltar Bank for extensive money laundering violations. These arguments would carry great weight with a jury and it is not unreasonable to project awards of upwards of 1/2 billion dollars against Gibraltar in light of the TD Bank verdict and settlement.
See the next post for the undisclosed and extraordinary hidden "Trojan horses" that are contained in the tainted bankruptcy Rothstein - Gibraltar settlement. Those Trojan horses further benefit and protect Berger Singerman honchos ... at the further great expense of the Rothstein victims.
Thursday, February 23, 2012
Scott Rothstein Redux Part 2: - More On The Gibraltar Bank "Settlement"
Either nobody read the Rothstein/Gibraltar Bank settlement ... or really cares that the Rothstein victims are being so freely victimized again.
Look closely at the reported Gibraltar - Rothstein "settlement" terms:
1. Gibraltar Bank will pay ten million dollars to the trustee. A large part of that amount will go into the pocket of Berger Singerman — controlled by Gibraltar stockholders Paul Singerman and other still unidentified Berger Singerman honchos (co-shareholders with Scott Rothstein in Gibraltar) — to pay for legal fees to Berger Singerman. That ten million is the maximum cap Gibraltar will be responsible for because the "settlement" bars victims from suing Gibraltar and part of the recovery from the insurers will be kicked back to Gibraltar! Berger Singerman double dipping not only protects their honchos' multimillion dollar holdings in Gibraltar, but they will collect more millions in legal fees from the "recovery."
2. Ten million dollars will be paid by Gibraltar's insurers — not Gibraltar, of course.
3. And here's the Berger Singerman triple dip: The Gibraltar bank's $50m claims against its liability insurers will be litigated by Berger Singerman because those claims are being assigned to the bankruptcy estate!
How sweet it is ... to be a bankruptcy insider like Paul Singerman!
There really is no shame here. The Rothstein victims are being victimized a second time through the stroke of a bankruptcy insider's pen ... by no less than Scott Rothstein's Gibraltar co-shareholders!
For the paltry sum of 10 million dollars — an amount that is a maximum cap and which will most likely be substantially reduced by recovery from insurers because of the recovery kick back to Gibraltar bank — hundreds of millions in Gibraltar (and Berger Singerman honcho shareholder) liability to Rothstein victims is evaded by the "settlement."
Toronto-Dominion Bank was not lucky enough to have bankruptcy connected insiders, such as Berger Singerman honchos, as shareholders. TD Bank was recently hit with a $67m judgment and more claims are moving through the pipeline.
Look closely at the reported Gibraltar - Rothstein "settlement" terms:
1. Gibraltar Bank will pay ten million dollars to the trustee. A large part of that amount will go into the pocket of Berger Singerman — controlled by Gibraltar stockholders Paul Singerman and other still unidentified Berger Singerman honchos (co-shareholders with Scott Rothstein in Gibraltar) — to pay for legal fees to Berger Singerman. That ten million is the maximum cap Gibraltar will be responsible for because the "settlement" bars victims from suing Gibraltar and part of the recovery from the insurers will be kicked back to Gibraltar! Berger Singerman double dipping not only protects their honchos' multimillion dollar holdings in Gibraltar, but they will collect more millions in legal fees from the "recovery."
2. Ten million dollars will be paid by Gibraltar's insurers — not Gibraltar, of course.
3. And here's the Berger Singerman triple dip: The Gibraltar bank's $50m claims against its liability insurers will be litigated by Berger Singerman because those claims are being assigned to the bankruptcy estate!
How sweet it is ... to be a bankruptcy insider like Paul Singerman!
There really is no shame here. The Rothstein victims are being victimized a second time through the stroke of a bankruptcy insider's pen ... by no less than Scott Rothstein's Gibraltar co-shareholders!
For the paltry sum of 10 million dollars — an amount that is a maximum cap and which will most likely be substantially reduced by recovery from insurers because of the recovery kick back to Gibraltar bank — hundreds of millions in Gibraltar (and Berger Singerman honcho shareholder) liability to Rothstein victims is evaded by the "settlement."
Toronto-Dominion Bank was not lucky enough to have bankruptcy connected insiders, such as Berger Singerman honchos, as shareholders. TD Bank was recently hit with a $67m judgment and more claims are moving through the pipeline.
Wednesday, February 22, 2012
Scott Rothstein Redux: - The Gibraltar Bank "Settlement" ... He Lives In Spirit!
The spirit of Scott Rothstein is alive and well ... in a local bankruptcy court as shown by the just announced "settlement" of the bankruptcy estate of Rothstein Rosenfeldt Adler with Gibraltar Private Bank & Trust. Unfortunately, its what you don't read in public reports that really counts since there are several "elephants in the ointment" in this so-called "settlement."
For the inquisitive, do a quick search for "in pari delicto in bankruptcy". Or simply look at the Eleventh Circuit case Official Com. of Unsecured Creditors of PSA, Inc. v. Edwards, 437 F. 3d 1145 (11th Cir. 2006).
Even quicker, in layman's terms, the concept of "in pari delicto" means the Rothstein Rosenfedt estate cannot sue, let alone settle, claims for damages to Rothstein's victims because Rothstein Rosenfedt was a perpetrator of the crime.
So what's going on here? The answer is to first remind oneself of a cardinal rule of local bankruptcy ethics: there aren't any when large $$$ are at stake. And the corollary rules: things are rarely what they seem; and follow the $$$.
Principal owners of Gibraltar bank are Berger Singerman honchos Paul Singerman and other unidentified Berger Singerman partners. Their investment in Gibraltar runs into the many millions but the full amount and degree of ownership is guarded with a level of secrecy that Iranian nuclear honchos can only envy. Berger Singerman is the lead attorney for the Rothstein estate.
Paul Singerman et al were Scott Rothstein's partners (co-shareholders) in Gibraltar bank. Because of normal due diligence standards, including the knowledge of Gibraltar owners of the extensive money laundering activities and who knew what and when, and recent Scott Rothstein's deposition disclosures on Gibraltar, it is clear Singerman honchos have a wealth of information about the involvement of Gibraltar bank's owners and employees ... and their liability. Of course, not a single Berger Singerman honcho has been deposed to get to the bottom of the Gibraltar fiasco.
In the "there is no shame" category:
The "settlement" includes a key provision that the Rothstein victims cannot sue Gibraltar bank! The Berger Singerman multi million dollar Gibraltar investments are now safe!
The "settlement" fine print also contains provisions that may ultimately bolster Berger Singerman honchos Gibraltar investments by millions.
It was just announced that the Rothstein estate is suing to block Rothstein's victims from suing Gibraltar bank in Broward county.
Lastly, for anyone who is gullible enough to believe the public announcement of a 65 million dollar potential "recovery" for Rothstein victims ... the check is in the mail.
For the inquisitive, do a quick search for "in pari delicto in bankruptcy". Or simply look at the Eleventh Circuit case Official Com. of Unsecured Creditors of PSA, Inc. v. Edwards, 437 F. 3d 1145 (11th Cir. 2006).
Even quicker, in layman's terms, the concept of "in pari delicto" means the Rothstein Rosenfedt estate cannot sue, let alone settle, claims for damages to Rothstein's victims because Rothstein Rosenfedt was a perpetrator of the crime.
So what's going on here? The answer is to first remind oneself of a cardinal rule of local bankruptcy ethics: there aren't any when large $$$ are at stake. And the corollary rules: things are rarely what they seem; and follow the $$$.
Principal owners of Gibraltar bank are Berger Singerman honchos Paul Singerman and other unidentified Berger Singerman partners. Their investment in Gibraltar runs into the many millions but the full amount and degree of ownership is guarded with a level of secrecy that Iranian nuclear honchos can only envy. Berger Singerman is the lead attorney for the Rothstein estate.
Paul Singerman et al were Scott Rothstein's partners (co-shareholders) in Gibraltar bank. Because of normal due diligence standards, including the knowledge of Gibraltar owners of the extensive money laundering activities and who knew what and when, and recent Scott Rothstein's deposition disclosures on Gibraltar, it is clear Singerman honchos have a wealth of information about the involvement of Gibraltar bank's owners and employees ... and their liability. Of course, not a single Berger Singerman honcho has been deposed to get to the bottom of the Gibraltar fiasco.
In the "there is no shame" category:
The "settlement" includes a key provision that the Rothstein victims cannot sue Gibraltar bank! The Berger Singerman multi million dollar Gibraltar investments are now safe!
The "settlement" fine print also contains provisions that may ultimately bolster Berger Singerman honchos Gibraltar investments by millions.
It was just announced that the Rothstein estate is suing to block Rothstein's victims from suing Gibraltar bank in Broward county.
Lastly, for anyone who is gullible enough to believe the public announcement of a 65 million dollar potential "recovery" for Rothstein victims ... the check is in the mail.
Wednesday, April 20, 2011
How Bear Stearns and Bankruptcy Insiders Laundered Millions ... Without Funds Ever Touching the Bankruptcy Estate
In my earlier posts (with more to follow), I began to show how Bear Stearns, using various bankruptcy insiders and a local bankruptcy court, had installed a self-proclaimed Israeli "assassin" cum secret agent, Juval Aviv (who had been previously indicted and prosecuted by the US Government), to "supervise" the local US Attorney's Office in extensive illegal, secret wiretapping of myself, my attorneys, my friends, my family and reporters I communicated with.
In 2006, I obtained the confession by Paul S. Singerman, of Berger Singerman, that protected law enforcement materials, including the results of the wiretapping, were then secretly funneled to Bear Stearns for their own private use. Bear Stearns was involved in extensive civil litigation in Florida state and federal courts with myself and my family. Anthony Pelicano — the infamous Hollywood P.I. who, similarly, was conducting wiretapping to get information for civil court cases — received 15 years in federal prison for these very actions.
The communications surveillance occurred throughout pending appeals in federal court and ongoing proceedings in Florida state court. It was done without notice — either before, during and after the (still ongoing?) surveillance — to myself, my attorneys, all reviewing courts, and the many other victims. This was completely hidden until late 2004, when the district court ordered the bankruptcy court to disgorge its extensive sealed and off-the-docket court record. Some of that record still remains concealed, despite the order.
To pay Berger Singerman and the extensive crew of secret "officers of the court" (complete with a "black bag" crew) — who were ostensibly retained by trustee Alan Goldberg — a scheme was orchestrated: Bear Stearns would pay the millions in fees, using a phantom "loan." In that way, Bear Stearns superficially protected itself and its agents from investigations into illegal activities, under the rubric of being "officers of the court."
The phantom "loan" funds never passed through any bankruptcy estate accounts or were reflected on any estate financial statements.
Since Bear Stearns paid the secret officers of the court directly, there were no traces in the bankruptcy court record (sealed or public) of their fee payment applications or fee approval orders. Also, the US Trustee was never served with any retention documents for the secret hirees and the key billing records of secret hirees still remain hidden, including those of Juval Aviv and P.I. William Riley.
Even the disclosed billing statements for the "public" hirees, e.g., Berger Singerman attorneys and attorney Michael Budwick, contain no reference to what took place during the secret hearings, or in England. Those statements never disclosed that fees were billed for illegally passing law enforcement tapes and other protected law enforcement materials to Bear Stearns senior managing directors, Mark Lehman and Daniel Taub.
Two of the key documents evidencing this scheme are: 1) the unsigned accounting statement for the bankruptcy estate filed yearly, and 2) the sham "loan" agreement:
This is one of the sham "Independent Estate Property Record and Report" accounting statements that was filed yearly:
Sham bankruptcy estate balance sheet filed by Paul Singerman of Berger Singerman for Alan Goldberg in October 2009.
Never, during a long career as an financial analyst on wall street, have I seen a filing more fraudulent than the above filing. Some reasons for this conclusion are:
— There is no signature or other identification of who actually prepared the accounting report. The only accountant the estate had, was employed for only a few days, early in the bankruptcy case. The accounting firm then immediately left the case ... without issuing any reports. No explanation was given for its removal.
— There is no entry for any part of the sham "loan" purportedly made by Bear Stearns to the estate to pay fees and expenses ... which totaled about $5 million dollars. The statement is a clear admission that no debt was ever owed to Bear Stearns — showing the "loan" agreement was a sham.
— The estate is valued at $20 million dollars. However, it provides no explanation how that value was arrived at. This is a fraudulent valuation since the estate had no asset value for several reasons:
First, Federal District Judge Lawrence King, during earlier litigation with Bear Stearns, ruled in 1996 that the trust had to be directly sued under Federal and Florida law. After that order was issued, Bear Stearns impleaded the trust as a defendant in 1997. So, Florida law was already being applied to the trust and that law required the trust be sued directly. Judge Herbert Stettin (the trustee of the Scott Rothstein bankruptcy estate) represented the trust in federal court.
Because the bankruptcy trustee, Alan Goldberg, refused to sue the trust, the estate's only asset was a worthless claim.
What had occurred in the bankruptcy was that a single line "finding" of estate property was inserted at the end of a discovery sanction order (written entirely by Berger Singerman) that was issued in a bankruptcy discharge objection proceeding held under 11 U.S.C. § 727. Liability in a discharge objection proceeding is legally impossible because the only matter at stake in such proceeding is the denial of a bankruptcy discharge.
In addition, during the secret bankruptcy hearings, Berger Singerman disclosed that Goldberg was suing, in England, the same trustees who were already represented by Judge Stettin in federal court before Judge King. This confirmed that the only estate "asset" was a claim of indeterminate value in England since Goldberg refused to sue in the U.S.
The hidden bankruptcy court transcripts further disclosed that Goldberg was seeking a Mareva Injuction in the England litigation. An English Mareva Injunction is a pre-judgment injunction issued while a claim is litigated. A few months earlier, the U.S. Supreme Court, in Grupo Mexicano de Desarrollo, SA v. Alliance Bond Fund, Inc., 527 US 308 (1999), had ruled that Mareva Injunctions (pre-judgment injunctions) were not permitted in U.S. Courts. Berger Singerman, thereby, secretly admitted that all they had was a claim and not a judgment against either myself or the trust.
Goldberg lost his ligation in England, so the value of his "asset" ... was zero. This confirmed that I was in prison to pay a judgment debt that never existed; and that Berger Singerman withheld critical information from myself, my attorneys, and reviewing courts throughout my appeals.
This is the phantom loan agreement between Goldberg and Bear Stearns, dated mid June 1998:
the still-used sham 1998 Bear Stearns-Goldberg finance agreement
One reason the $5 million in payments made by Bear Stearns were not listed on the bankruptcy estate accounting report is that even such a debt could give rise to criminal charges as fraudulent fee claims against the bankruptcy estate, for the theft of law enforcement materials.
Moreover, since none of the secret officers of the court submitted bills for approval, no orders for submitted bills were issued, and no service was made on the U.S. Trustee's Office (required by law to review all bills), the Bear Stearns fee payments were not an estate debt.
Also, even though the loan agreement claims it was reached in mid June, Bear Stearns had already secretly funneled funds to Goldberg's ostensible professionals before that date. See this post.
The "professionals," who received fee payments from Bear Stearns, fall into two categories. First were Goldberg's publicly disclosed professionals, e.g., Berger Singerman attorneys, attorney Michael Budwick.
Mr. Budwick, co-counsel with Berger Singerman, has stated in court filings that he never knew of the secret hearings or the communications surveillance.
The second group were those "professionals," who were ostensibly hired by Goldberg under "seal." This second group included Juval Aviv, P.I. William Riley, Coudert Brothers, and others.
The latter (secretly hired) group all had backdated (nunc pro tunc) individual "sealed" applications filed, and at the related "retention" hearings still undisclosed "results" were reported without the presence of a court reporter.
None of these sealed retentions were lawful because: none of the applications were served on the U.S. Trustee's Office, so they could not be reviewed, as required by law; none of the secret hirees filed their bills, even under seal, (the single exception being Coudert Brothers, which filed bills years later — but Coudert didn't seek approval for payments to it by Bear Stearns and its bills listed Bear Stearns as its client); none of the secret hirees sought or received approval for bill payments. These missing prerequisites to legitimacy invalidated employment by Goldberg and instead the group was employed by Bear Stearns, which paid them.
The "public" group never submitted or released bills that described their actions taken "under seal," even after the record was unsealed.
In 2006, I obtained the confession by Paul S. Singerman, of Berger Singerman, that protected law enforcement materials, including the results of the wiretapping, were then secretly funneled to Bear Stearns for their own private use. Bear Stearns was involved in extensive civil litigation in Florida state and federal courts with myself and my family. Anthony Pelicano — the infamous Hollywood P.I. who, similarly, was conducting wiretapping to get information for civil court cases — received 15 years in federal prison for these very actions.
The communications surveillance occurred throughout pending appeals in federal court and ongoing proceedings in Florida state court. It was done without notice — either before, during and after the (still ongoing?) surveillance — to myself, my attorneys, all reviewing courts, and the many other victims. This was completely hidden until late 2004, when the district court ordered the bankruptcy court to disgorge its extensive sealed and off-the-docket court record. Some of that record still remains concealed, despite the order.
To pay Berger Singerman and the extensive crew of secret "officers of the court" (complete with a "black bag" crew) — who were ostensibly retained by trustee Alan Goldberg — a scheme was orchestrated: Bear Stearns would pay the millions in fees, using a phantom "loan." In that way, Bear Stearns superficially protected itself and its agents from investigations into illegal activities, under the rubric of being "officers of the court."
The phantom "loan" funds never passed through any bankruptcy estate accounts or were reflected on any estate financial statements.
Since Bear Stearns paid the secret officers of the court directly, there were no traces in the bankruptcy court record (sealed or public) of their fee payment applications or fee approval orders. Also, the US Trustee was never served with any retention documents for the secret hirees and the key billing records of secret hirees still remain hidden, including those of Juval Aviv and P.I. William Riley.
Even the disclosed billing statements for the "public" hirees, e.g., Berger Singerman attorneys and attorney Michael Budwick, contain no reference to what took place during the secret hearings, or in England. Those statements never disclosed that fees were billed for illegally passing law enforcement tapes and other protected law enforcement materials to Bear Stearns senior managing directors, Mark Lehman and Daniel Taub.
Two of the key documents evidencing this scheme are: 1) the unsigned accounting statement for the bankruptcy estate filed yearly, and 2) the sham "loan" agreement:
This is one of the sham "Independent Estate Property Record and Report" accounting statements that was filed yearly:
Sham bankruptcy estate balance sheet filed by Paul Singerman of Berger Singerman for Alan Goldberg in October 2009.
Never, during a long career as an financial analyst on wall street, have I seen a filing more fraudulent than the above filing. Some reasons for this conclusion are:
— There is no signature or other identification of who actually prepared the accounting report. The only accountant the estate had, was employed for only a few days, early in the bankruptcy case. The accounting firm then immediately left the case ... without issuing any reports. No explanation was given for its removal.
— There is no entry for any part of the sham "loan" purportedly made by Bear Stearns to the estate to pay fees and expenses ... which totaled about $5 million dollars. The statement is a clear admission that no debt was ever owed to Bear Stearns — showing the "loan" agreement was a sham.
— The estate is valued at $20 million dollars. However, it provides no explanation how that value was arrived at. This is a fraudulent valuation since the estate had no asset value for several reasons:
First, Federal District Judge Lawrence King, during earlier litigation with Bear Stearns, ruled in 1996 that the trust had to be directly sued under Federal and Florida law. After that order was issued, Bear Stearns impleaded the trust as a defendant in 1997. So, Florida law was already being applied to the trust and that law required the trust be sued directly. Judge Herbert Stettin (the trustee of the Scott Rothstein bankruptcy estate) represented the trust in federal court.
Because the bankruptcy trustee, Alan Goldberg, refused to sue the trust, the estate's only asset was a worthless claim.
What had occurred in the bankruptcy was that a single line "finding" of estate property was inserted at the end of a discovery sanction order (written entirely by Berger Singerman) that was issued in a bankruptcy discharge objection proceeding held under 11 U.S.C. § 727. Liability in a discharge objection proceeding is legally impossible because the only matter at stake in such proceeding is the denial of a bankruptcy discharge.
In addition, during the secret bankruptcy hearings, Berger Singerman disclosed that Goldberg was suing, in England, the same trustees who were already represented by Judge Stettin in federal court before Judge King. This confirmed that the only estate "asset" was a claim of indeterminate value in England since Goldberg refused to sue in the U.S.
The hidden bankruptcy court transcripts further disclosed that Goldberg was seeking a Mareva Injuction in the England litigation. An English Mareva Injunction is a pre-judgment injunction issued while a claim is litigated. A few months earlier, the U.S. Supreme Court, in Grupo Mexicano de Desarrollo, SA v. Alliance Bond Fund, Inc., 527 US 308 (1999), had ruled that Mareva Injunctions (pre-judgment injunctions) were not permitted in U.S. Courts. Berger Singerman, thereby, secretly admitted that all they had was a claim and not a judgment against either myself or the trust.
Goldberg lost his ligation in England, so the value of his "asset" ... was zero. This confirmed that I was in prison to pay a judgment debt that never existed; and that Berger Singerman withheld critical information from myself, my attorneys, and reviewing courts throughout my appeals.
This is the phantom loan agreement between Goldberg and Bear Stearns, dated mid June 1998:
the still-used sham 1998 Bear Stearns-Goldberg finance agreement
One reason the $5 million in payments made by Bear Stearns were not listed on the bankruptcy estate accounting report is that even such a debt could give rise to criminal charges as fraudulent fee claims against the bankruptcy estate, for the theft of law enforcement materials.
Moreover, since none of the secret officers of the court submitted bills for approval, no orders for submitted bills were issued, and no service was made on the U.S. Trustee's Office (required by law to review all bills), the Bear Stearns fee payments were not an estate debt.
Also, even though the loan agreement claims it was reached in mid June, Bear Stearns had already secretly funneled funds to Goldberg's ostensible professionals before that date. See this post.
The "professionals," who received fee payments from Bear Stearns, fall into two categories. First were Goldberg's publicly disclosed professionals, e.g., Berger Singerman attorneys, attorney Michael Budwick.
Mr. Budwick, co-counsel with Berger Singerman, has stated in court filings that he never knew of the secret hearings or the communications surveillance.
The second group were those "professionals," who were ostensibly hired by Goldberg under "seal." This second group included Juval Aviv, P.I. William Riley, Coudert Brothers, and others.
The latter (secretly hired) group all had backdated (nunc pro tunc) individual "sealed" applications filed, and at the related "retention" hearings still undisclosed "results" were reported without the presence of a court reporter.
None of these sealed retentions were lawful because: none of the applications were served on the U.S. Trustee's Office, so they could not be reviewed, as required by law; none of the secret hirees filed their bills, even under seal, (the single exception being Coudert Brothers, which filed bills years later — but Coudert didn't seek approval for payments to it by Bear Stearns and its bills listed Bear Stearns as its client); none of the secret hirees sought or received approval for bill payments. These missing prerequisites to legitimacy invalidated employment by Goldberg and instead the group was employed by Bear Stearns, which paid them.
The "public" group never submitted or released bills that described their actions taken "under seal," even after the record was unsealed.
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