Imprisoned Ponzi schemer Scott Rothstein, who is serving a fifty-year stint in Federal custody, had hoped for a Rule 35(b) sentence reduction, on account of his Substantial Assistance to US law enforcement, but his hopes that his sentence will be cut appear to be failing of late; here's why.
Yes, on June 8, 2011, and properly within one year of sentencing, the US Attorney's Office in the Southern District of Florida filed a Rule 35(b) motion. That way, the Court retained jurisdiction to reduce his sentence at a later date, but here's the kicker:
"6. Upon completion of the defendant's cooperation, the Government will file a motion for a hearing, at which time, the Government will advise the Court of the nature, extent, and value of the defendant's cooperation. It is requested, however that the Court stay any ruling on the instant motion until the Government files the motion for such a hearing. "
"7. The United States expressly reserves the right to withdraw this motion if, in the judgment of the United States, the defendant should fail to comply with the terms of his plea agreement, fail to testify truthfully, or falsely implicate any person or entity." Motion for Reduction of Sentence and for Stay of Ruling at 2.
if you have been following the case closely, the defendant allegedly counseled his wife, Kim Rothstein, to hide millions of dollars in jewelry from investigators, who were marshaling assets for the Receiver of Rothstein's law firm. In his testimony at the trial of a Ponzi participant, Rothstein stated:
"I understand that there's been an issue concerning my failure to disclose what I did with my wife and the jewelry. My hope is that at the end of the day, that the Government, they will see that I did a lot more good than bad." Testimony at Christina Kitterman trial.
Rothstein's wife went to prison, for secreting, covertly selling, and hiding the truth about, their jewels, but the consequences for her husband will be much more severe. The five-year statute of limitations has now run out, and there probably will not be any more criminal prosecutions, unless the US Attorney seeks RICOA charges, which are unlikely, meaning that Rothstein's testimony or assistance will no long be needed.
It looks like a sentence reduction is not in the cards for the master Ponzi schemer, whose presumptive release date is, by my calculation, in June, 2053, at which time, if he is still alive, he will be 91 years old. I hope that information is a comfort to the investors who were victims of his Ponzi scheme.