Firm Paid Rothstein $35 Million in 2008

Nothing like a 30% pay cut for house-buying!

By JANIE CAMPBELL

Updated 3:17 PM EDT, Sun, Dec 6, 2009

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In the days since Scott Rothstein returned from Morocco to face the music for a many-splendored Ponzi scheme, odd details have emerged shedding light on the machinations of the disgraced lawyer's firm, Rothstein Rosenfeldt Adler.

There were shockingly unprofessional e-mails Rothstein sent to associates beginning with "hey kidzzz" and ending with "love ya," his highly charged declarations reaffirming the position of COO Debra Villegas ("I will NEVER tolerate attacks. NEVER!!!!!!!!!!!!!!!!!!!!!!!!"), and a suspiciously impenetrable suite of offices that Rothstein demanded no one enter and from which he monitored the other offices via video.

Now financial details are emerging that are equally bizarre: in 2008, the firm paid Rothstein, the chairman and CEO, over $35 million dollars while President and 50% partner Stuart Rosenfeldt took home $6 million and name partner Russell Adler earned $888,318.

But in 2009, the partners' salaries nose-dived: through October, Rothstein took home "just" $10.5 million, Rosenfeldt $847,599, and Adler $853,666.

The latest revelations come from bankruptcy trustee Herbert Stettin's court filings, and beg the question: did Rosenfeldt question the huge gap in pay between partners? But Stettin and auditors have so far been able to paint a complete picture of the company's finances: some records were seized by federal agents, and the rest are "a mess."

“From the Trustee’s preliminary review of available books and records," Stettin wrote, "it appears that there were a large number of unorthodox and so far unexplained transactions that occurred at Rothstein’s direction or under his control. Abnormal transactions appear to have occurred in both the [firm's] trust and operating accounts.”

You don't say! Observers are confident the drop in salaries comes at the same time Rothstein's scheme began to run out of money and he realized the jig, so to speak, was up.

Still, ever the (alleged!) hustler, Rothstein wasn't done trying: the Miami Herald reports that in October Rothstein sent the following to a Los Angeles-based investor:

"Hey AJ...if you want to do something nice for one of your big funders (and for you and frank and dean and doug), I have a single deal on a sex harassment case I just settled,'' he wrote. "It involved a horrific sexual assault against a girl that just turned 18.''

Rothstein wrote that the girl would accept only $18 million of a purported $30 million settlement if she could get paid immediately.

The investors' supposed return: $12 million, after six months.

"Let me know. Ciao ciao, Money never sleeps, motherf----- :-)"

Wow. Money may not sleep, but can anyone explain how Rothstein does?