Former CFO of Rothstein, Rosenfeldt, and Adler, P.A. Charged with Conspiracy to Launder Money and to Defraud a Financial Institution
| U.S. Attorney’s Office April 16, 2014 |
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida; George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office; and José A. Gonzalez, Special Agent in Charge, Internal Revenue Service, Criminal Investigations (IRS-CI), announce the filing of charges against Irene Shannon, formerly known as Irene Stay, 50, of Miami, for conspiring to commit crimes through the operation of the former Fort Lauderdale law firm of Rothstein, Rosenfeldt, and Adler, P.A. (RRA). The defendant was the chief financial officer of RRA. In 2009, it was discovered that RRA was being utilized by its chairman and chief executive officer, Scott W. Rothstein, to commit a massive Ponzi scheme stemming from the sale of fictitious confidential settlements.
The information, which was filed earlier today, charges Shannon with conspiracy to commit money laundering and to defraud a financial institution, in violation of 18 U.S.C.-371. If convicted, the defendant faces a maximum statutory sentence of up to five years in prison.
According to the information, Shannon oversaw the accounting functions of RRA, including the deposits and withdrawals made by RRA and Rothstein at TD Bank and other financial institutions. In furtherance of the Ponzi scheme, Shannon transferred hundreds of millions of dollars obtained from investors to pay prior investors in the scheme and to supplement and support the operation and activities of RRA, among other purposes. The information further charges that the defendant was well aware that hundreds of millions of dollars were not being held in trust accounts for investors, contrary to what those investors had been told, and that the funds were instead being disbursed to further Rothstein’s fraudulent scheme. The information also charges that the defendant utilized her position to float checks between and among certain bank accounts maintained by RRA in a form of bank fraud commonly known as “check kiting.”
U.S. Attorney Wifredo A. Ferrer stated, “Once again, the information filed today reaffirms that Rothstein’s massive fraud could not have been the work of one person. As alleged in the information, Irene Shannon played an important role in carrying out Rothstein’s fraud and concealing it from the investors. Indeed, as chief financial officer of RRA, Shannon knew hundreds of millions of dollars of investor funds were not being held in trust accounts and that the funds were being disbursed to further Rothstein’s fraudulent scheme. Shannon is now the 18th accomplice to be held accountable in Rothstein’s $1.2 billion Ponzi scheme.”
“Scott Rothstein was the mastermind of a massive Ponzi scheme, but he needed a trusted agent who knew how to shuffle money to keep the scheme running,” said George L. Piro, Special Agent in Charge, FBI Miami. “Irene Shannon, Rothstein, Rosenfelt, and Adler’s chief financial officer, transferred millions of dollars and floated innumerable checks in an effort to make it all look legitimate. It wasn’t, and now she will be held accountable.”
IRS Special Agent in Charge José A. Gonzalez stated, “As chief financial officer of Rothstein, Rosenfeldt, and Adler, P.A., Shannon was in a position to conspire and actively participate with Scott Rothstein in his massive money laundering scheme. By following the money trail, IRS special agents were able to determine that Shannon assisted Scott Rothstein by conducting numerous fraudulent financial transactions designed to deceive investors by creating a facade of wealth. Today’s message serves as a reminder that those who engage in the deception and financial exploitation of honest investors will be held accountable for their actions.”
Mr. Ferrer commended the investigative efforts of the FBI and IRS-CI. This case is being prosecuted by Assistant U.S. Attorneys Lawrence D. LaVecchio, Paul F. Schwartz, and Jeffrey N. Kaplan.
An information is only an accusation and a defendant is presumed innocent unless and until proven guilty.
A copy of this press release may be found on the website of the United States Attorney’s Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls.