The Federal Courts continue to mete out strict punishment to lawyers who, even on the fringes, facilitate Ponzi schemes.The Eleventh Circuit Court of Appeals has affirmed the conviction, and five-year sentence, of Fort Lauderdale, Florida attorney Christina Kitterman, an attorney in billion dollar Ponzi schemer Scott Rothstein's law firm. Kitterman impersonated a Florida bar official, in a telephone conference with Ponzi victims, to falsely assure them that a non-existent Bar matter was interfering with their payments.
Kitterman's attorneys had asserted that the evidence was insufficient to sustain conviction. The appeals court held that " there was sufficient evidence that a jury could believe that Kitterman intended to cause the deprivation of something of value by ... deceit.*" it also dismissed her allegations that certain evidence was inadmissible and prejudicial, and found that the 60-month sentence was substantively reasonable.
The opinion sends a clear message to the legal community; if you assist a client, who is later determined to have perpetrated a Ponzi scheme, you will face the consequences. Florida Federal Courts have also meted out similar punishement to lawyers who represented mega-Ponzi schemer Joel Steinger, whose Mutual Benefits Corp. Ponzi rocked the life settlement industry.
*United States v. Kitterman, Case no.: 14-12387 (11th Cir. 2015) at 5.