Scott Rothstein Associate Pleads Not Guilty To Money-Laundering


One of Scott Rothstein’s closest confidantes at his defunct Fort Lauderdale law firm pleaded not guilty Wednesday to a money-laundering conspiracy charge alleging she helped him engineer his $1.2 billion Ponzi scheme.

Debra Villegas, former chief operating officer of Rothstein’s law firm, was granted a $250,000 bond by U.S. Magistrate Robin Rosenbaum after federal prosecutors said she has been assisting them with the investigation into South Florida’s biggest financial fraud scheme since it crashed last fall.

Assistant U.S. Attorney Lawrence LaVecchio said Villegas has been cooperating “with no conditions” and that she has been “truthful and candid” not only about her own “culpability” in Rothstein’s investment racket but also about others suspected of playing roles in the scam.

Villegas’ attorney Robert Stickney said his client is now “indigent” and experiences fainting spells from all the pressure of the high-profile case. He said Villegas, now living in Clewiston, also must take care of one of her sons who suffers from psychological problems stemming from her estranged husband’s being charged with the murder of Villegas’ best friend, a former partner in Rothstein’s law firm.

Ultimately, Villegas, 42, is expected to change her plea to guilty, according to sources familiar with the case. The charge carries a sentence of up to 10 years in prison.

Villegas is accused of helping her boss fabricate legal settlements that he sold to wealthy investors, boosting his investment racket until it suddenly unraveled last October, according to a criminal information filed in Fort Lauderdale federal court.

She became the first alleged co-conspirator named in Rothstein’s investment scam. He pleaded guilty to racketeering charges in January.

Rothstein pleaded guilty to five charges of conspiracy, racketeering, money-laundering and wire fraud for duping wealthy investors over the past four years by selling them bogus civil settlements based on purported sexual harassment and whistle-blower complaints.

The investor funds were funneled through local branches of Toronto Dominion Bank and Gibraltar Bank.

Rothstein could be sent to prison for up to 100 years at his sentencing in June — though his assistance in an FBI sting operation that recently took down an accused Italian mafia figure from Miami Beach could help reduce his incarceration.

(Read More: Miami Herald)