Here's part two of the Rothstein deposition regarding Silverseas Cruises (and it's long). Read part one here.
23 Q. Does the "this" pertain to the bridge loans
24 that he was engaged in with you or does the "this"
25 pertain to something else?
1 A. Yes. No. No. To the bridge loans.
2 Q. Did he ever ---
3 A. The deals. Whatever you want to call them.
4 Q. Did he ever participate in any of the
5 settlements with you, to the best of your
7 A. Not with full deal packets, no.
8 Q. Did he know you were engaged in them?
9 A. You know, he knew I was doing business with
10 hedge funds. I'd have to go back and look at the
11 e-mail track to see if he thought I had ever told him
12 about the settlement business premise, but he did
13 know I was doing business with hedge funds.
14 I remember seeing e-mails from Blandin and
15 the like regarding getting lines of credit from hedge
17 Q. You mentioned earlier, like two minutes
18 ago, Mr. Peter's embezzlement from the company.
19 Are you alluding to his embezzlement
20 through these fake invoices or is there a different
21 embezzlement that you're referencing?
22 A. Both.
23 Q. What is the different -- the other part of
25 We have the invoices. What's part two?
1 MR. LICHTMAN: Uh-oh. A frozen screen.
2 Can you hear us?
3 MR. GOLDBERG: Frozen audio. Frozen
5 MR. LICHTMAN: We have a frozen screen.
6 (Short Break, after which the
7 deposition continued with Mr. LaVecchio out of the
9 A. Where were we?
10 Q. I'm going to proceed. I suspect that Larry
11 is not going to care.
12 He may be in a moment, in any event.
13 A. Okay.
14 Q. With respect to the embezzlement before the
15 video got cut out I had asked you what part two was.
16 Part one was the invoices.
17 There was the fake invoices. There was
18 Mr. Peter's use of his Silversea American Express
19 card and expense account to fund a significant amount
20 of personal expenses.
21 (Whereupon, Mr. LaVecchio returned)
22 And then there was his involvement with me
23 in a scheme that was devised to prevent and avoid
24 detection of both our embezzlement scheme and his
25 expense account scheme and other things I suspect
1 that he was doing at Silversea by taking action to
2 keep Mr. Lefebvre, the chairman of the board and
3 major shareholder of the company, out of the United
4 States and out of his hair. He did not want that
6 Q. I will get to the American Express card and
7 Mr. Lefebvre's situation.
8 I just wanted to make sure I understood
9 that that was the circumstances surrounding the
11 So let me go back, if I may. Do you still
12 have before you Trustee's documents -- you were on
13 137 before.
14 A. Yes.
15 Q. Take a look at 139.
16 A. Okay.
17 Q. 139 is an invoice dated January 25, 2006,
18 and that's an $80,000 bill.
19 Is this a totally fraudulent invoice?
20 A. Yes. It is actually us billing -- and I
21 mean "us" -- meaning me, my firm and Mr. Peter --
22 billing Silversea for us engaging in acts to keep him
23 out of the country, so it was actually reverse, but
24 there was never $80,000 of time spent on this
25 particular topic as listed in this invoice.
1 Q. When you say keeping Mr. Lefebvre out of
2 the country, is that the reference to confidential
3 services provided for Mr. Lefebvre regarding
4 corporate security issues?
5 A. Yes.
6 Q. I am going to come back to that, so at
7 some point we're going to come back to 139.
8 It's labeled "confidential project."
9 Actually, maybe now is as good a time as any to get
10 into it.
11 Confidential project. So the bill was
12 being sent, and it's so confidential that even the
13 client can't say what it is that you're doing. Huh?
14 A. Well, when you're not doing anything or,
15 actually, when you're doing certain things that you
16 don't want the client to know you're doing, yes,
17 "confidential" is the best word to use.
18 Q. Was Mr. Lefebvre under the impression,
19 though, that you were doing something to protect him
20 with respect to the issues that you and Mr. Peter
21 were engaged in in preventing him from coming into
22 the country?
23 A. Yes.
24 Q. Now is a good time I guess. Then we will
25 describe this.
1 Tell me what it was that Mr. Peter and you
2 devised to keep Mr. Lefebvre out of the country.
3 A. Mr. Peter explained to me that every time
4 Mr. Lefebvre came into the country it interfered with
5 our ability to engage in our embezzlement scheme. It
6 interfered with his ability to maneuver expenses and
7 the like, and whatever else he was doing at the
8 company. It interfered with his let's call it
9 lifestyle at the company, and he enlisted my services
10 and services of other co-conspirators through me for
11 the purpose of making Mr. Lefebvre believe that he
12 had potential significant criminal legal problems in
13 the United States and, thus, that he should not
14 travel here.
15 Q. What was your understanding of what
16 Mr. Lefebvre knew in terms of him having this
17 potential criminal exposure in the United States?
18 A. That he was under investigation for
19 participation in a prostitution ring and potentially
20 some other financial issues involving his company.
21 Q. With respect to the prostitution ring, to
22 the best of your knowledge was Mr. Lefebvre involved
23 in a prostitution ring?
24 A. He was not involved in a prostitution ring.
25 We came up with that based upon Albert telling me
1 that he frequented prostitutes when he was here, so
2 we used that as a pressure point.
3 Q. How did you use it as a pressure point?
4 THE WITNESS: Mr. LaVecchio ---
5 MR. LICHTMAN: Let me clarify something.
6 I understand generally that there was some
7 police activity involved. I've reached an agreement
8 because I understand the sensitivity at the present
9 time of divulging the name of any officers that may
10 have been involved in this with you -- so would it be
11 acceptable to say which department it was without
12 getting into ---
13 MR. LaVECCHIO: I think that would still
14 cause a problem. I think if you could ---
15 Q. Just say "the police" without saying which
17 A. I enlisted the aid of a police officer who
18 was on my payroll, so to speak, being paid by me to
19 do various illegal acts on my behalf and on behalf of
20 my firm and on behalf of various clients and others
21 to create a charade whereby we made Mr. Lefebvre
22 believe that he was under a very serious
23 investigation by law enforcement.
24 We had this police officer come in uniform
25 to the Silversea offices and appear there and ask
1 for Mr. Lefebvre on multiple occasions.
2 We had this same police officer call
3 Mr. Lefebvre repeatedly on his cell phone. We had
4 this same police officer call Mr. Lefebvre's
5 secretary and his receptionist at Silversea asking
6 for him. We had the police officer telling people
7 that he had to find Mr. Lefebvre and that he was not
8 going to stop until he was able to get ahold of him.
9 Q. What was the period of time, approximately,
10 that this took place over?
11 A. More than a year. I don't recall the
12 specific timeframe.
13 Q. And who had knowledge and participated with
14 you in this activity with respect to the police
15 officer giving this information to Mr. Lefebvre?
16 A. Me, Albert Peter, the police officer, Irene
17 Stay, Debra Villegas and Stuart Rosenfeldt.
18 Q. Were there any fraudulent legal documents
19 that you drafted to give this alleged investigation
21 A. I do not recall one way or the other.
22 Q. Did Steve Caputi play any role in this
24 A. He did.
25 Q. What was Mr. Caputi's role?
1 A. At a specific point in time we had
2 Mr. Caputi actually fly overseas to Mr. Lefebvre's
3 location and call him repeatedly and call his family
4 repeatedly posing as a reporter in order to scare
5 Mr. Lefebvre.
6 Q. A reporter for whom?
7 A. You know, it was a big newspaper and I
8 don't recall which newspaper it was.
9 Q. New York Times?
10 A. It's very possible, yes. It was a big
11 newspaper. It was crafted by Mr. Peter and I in such
12 a fashion as to scare the living daylights out of
13 Mr. Lefebvre.
14 Q. What were your instructions to Mr. Caputi
15 as to what to say to Mr. Lefebvre and/or his family
16 when he telephoned him?
17 A. That he was investigating improprieties on
18 Mr. Lefebvre's behalf and he was going to be writing
19 an article about it and he wanted to get his side of
20 the story.
21 Q. The improprieties meaning Mr. Lefebvre's
22 use of prostitutes in America?
23 A. Yes.
24 Q. Did the story also encompass financial
25 improprieties of Silversea under Mr. Lefebvre's
2 A. It did, involving some paintings and the
3 like, but ultimately you understand I don't know what
4 Mr. Caputi actually said -- only what I instructed
5 him to say.
6 Q. Did you have a conversation with
7 Mr. Lefebvre yourself, one-on-one, about any of these
8 alleged investigations that were going on pertaining
9 to his activities?
10 A. I did.
11 Q. How many times did you speak with him about
13 A. Dozens.
14 Q. So would it be a fair statement that
15 Mr. Lefebvre thought that you were protecting his
16 interests with respect to these investigations that
17 were actually not real investigations?
18 A. Yes, sir.
19 Q. And is that what legitimized your being
20 able to generate the legal fee statements that were
21 completely fabricated time that referenced the
22 confidential project involving Mr. Lefebvre?
23 A. Yes, sir.
24 Q. And is that then why the illegal fee
25 statements went uncontested by Mr. Lefebvre to the
1 extent that he knew that they were being paid,
2 because he thought it was for legitimate services
3 rendered to protect his interests?
4 A. Yes, sir. That, in combination with
5 Albert's input.
6 Q. And were you present in any conversations
7 between or among Albert, Mr. Lefebvre and yourself
8 about these issues?
9 A. I was present during conversations with me,
10 Albert and Mr. Lefebvre, and I was in Albert's office
11 with him unbeknownst to Mr. Lefebvre when Albert had
12 called Mr. Lefebvre to scare him.
13 Q. What did you hear Mr. Peter say to
14 Mr. Lefebvre?
15 A. On occasions when we didn't even have the
16 police coming to the office Albert would call him and
17 tell him that he had just been accosted by the police
18 about him, that he better not come into the country,
19 he put on a whole charade about how concerned he was
20 for Manfredi, and he also used it in a manner to kind
21 of demean Mr. Lefebvre by saying, "You've gotten this
22 company into a lot of trouble through your actions,
23 this could be devastating to the company," that type
24 of thing.
25 Q. What was Mr. Lefebvre's reaction?
1 A. At various points in time he appeared to be
2 frightened. At various points in time he appeared to
3 be incredulous and had to be further convinced that
4 this was real, and that that would generally provoke
5 another visit from law enforcement.
6 Q. I assume that conversation that you alluded
7 to was on speaker phone?
8 A. Yes, sir.
9 Q. Was the result of these activities with
10 the policeman and Mr. Caputi and your conference
11 calls with Mr. Lefebvre such that, in fact, he did
12 not come to the United States?
13 A. Most of the time. There were occasions
14 where he had to travel here, where he insisted, and
15 we created a whole charade where we basically had to
16 sneak him into the country. He had to be very
17 careful. He had to keep us apprised as to his
18 whereabouts at all times so that Albert would, in
19 fact, know when he was coming to the office. We had
20 to sneak him into the office. We had a driver for
21 him, and we actually had this police officer, for
22 lack of a better term, chasing him through the
24 Q. You mean a fake police chase?
25 A. Not so much a fake police chase, but just
1 that the police officer was there and Manfredi knew
2 he was on his tail, but it wasn't a police chase.
3 Q. For the record, I have some documents that
4 you don't have. They've been Bates stamped as
5 T-AP00211 through T-AP00215.
6 I'm going to mark them as Composite
7 Exhibit 3. I want to put on the record I am -- you
8 don't have them. I'm not going to get into detail on
9 them right now because I can authenticate them
11 I want to be clear I am going to take these
12 back to my office and flyspeck them. I know that a
13 couple of them have the police officer's name on it
14 and I'm going to redact the police officer's name and
15 anything that would remotely suggest where the police
16 officer worked and then after that I'll give the
17 documents to the court reporter.
18 Is that okay with you, Larry?
19 MR. LaVECCHIO: That's fine.
20 (Whereupon, the documents referred to
21 were marked Plaintiff's Composite Exhibit No. 3 for
23 A. Okay. Mr. Lichtman, I'm going to take a
24 two-minute break to use the restroom.
25 Q. All right. That's good, because I actually
1 need to discuss something with Mr. LaVecchio about
2 one of these documents.
3 (Short Break)
4 Q. I have these e-mails here -- and, again,
5 I'm going to be a little sketchy on the e-mails
6 because they contain names that I know ought not yet
7 be publically revealed.
8 One of them -- this is document 211 --
9 references a police officer coming to Silversea and
10 asking Rose, the receptionist, to see Mr. Lefebvre
11 and asking if Mr. Lefebvre was in town, asked if he
12 was at a convention in Miami, then asked if Rita, who
13 I believe was Mr. Peter's assistant at that time, or
14 Mr. Peter were there.
15 Do you remember anything about that
16 particular event?
17 A. I do.
18 Q. Tell me what you recall.
19 A. It was one of the occasions when
20 Mr. Lefebvre insisted on coming into town and we
21 dispatched the police officer to go to the office so
22 that while Mr. Lefebvre was in town he stayed away
23 from the Silversea office.
24 Q. March 14, 2006. Does that sound correct to
25 you as to timing?
1 A. I don't recall the date, but that sounds
2 approximately correct.
3 Q. And Mr. Peter was knowledgeable and
4 involved in this scheme with you. Correct?
5 A. Yes, sir.
6 Q. There's also an e-mail that you wrote to
7 Albert, copied to Manfredi, and it says -- this is
8 document T-AP00212: "I am most distressed. I just
9 had the police here asking if Manfredi was in my
10 office. I advised that he is not in the country and
11 that I am unaware of his travel schedule. Did they
12 go to the Silversea office or just to my office?
13 Please advise. I need to know so I can properly
14 follow up. The prior matter has been resolved in
15 full in Manfredi's favor. Thus I am concerned as to
16 why they would still be attempting to contact him.
17 Can one of you please advise?"
18 That's the same date as the other e-mail.
19 Is this e-mail -- do you remember this
20 e-mail or the facts?
21 A. I do.
22 Q. Can you describe your understanding of what
23 you were saying and what was happening in connection
24 with drafting this e-mail?
25 A. Albert was talking about the fact that
1 Manfredi was still talking about coming up to the
2 office. He contacted me, told me that I needed to
3 fire off an e-mail to further frighten Manfredi and
4 to be in conjunction with the fact that this police
5 officer was at the office.
6 Q. You say here, "I advised that he is not in
7 the country and that I am unaware of his travel
9 Was that to suggest to Albert and to
10 Manfredi that you were telling the police something
11 that wasn't true to get them off of the trail?
12 A. Yes.
13 Q. There's another e-mail. It's T-AP00213.
14 This has the person's name in it it so I'm not going
15 to mention it, but it says: Mr. Blank stopped by for
16 Mr. Lefebvre, and the blank is the name of the
18 It was sent to you by a Vicki C. at
19 Silversea Cruises and it says, "Scott wanted you to
20 know right away."
21 Do you recall the circumstances behind that
23 A. I do.
24 Q. Can you describe them, please?
25 A. I had dispatched this officer to Silversea
1 after discussing the issue with Albert and problems
2 we were having with Manfredi, and I specifically told
3 the officer to ask for Ms. Carmichael, who was the
4 director of human resources, so it would appear that
5 he had been and had knowledge about the people at the
6 company and the like.
7 He did what I asked him to do and Vicki
8 wrote to me about it.
9 Q. And then I have an e-mail -- this is
10 T-AP00215. This was to Albert Peter and Freddy
11 LeFebvre, Amerigo Perasso with a copy to you sent by
12 Rita Alijaj, A-L-I-J-A-J, and this says -- again,
13 this has a different name so I'm not going to use the
14 name, but it says: I just received a call from Blank
15 from the organized task force asking to speak with
16 Albert, Manfredi or Amerigo. I asked what it was
17 regarding and he would not specify. I explained
18 Albert was not available and Mr. Lefebvre and
19 Mr. Perasso were currently out of the country. He
20 said this is a big conflict and said he would call
21 again next week. Thank you.
22 Do you recall the circumstances of that
24 A. What's the date?
25 Q. January 31, 2007, which if it helps you
1 from a timeframe was about the time that Albert was
2 being terminated from Silversea.
3 A. Yes. I do recall that.
4 Q. What do you recall?
5 A. We had at this point in time enlisted the
6 assistance of Rita Alijaj. She was one of Albert's
7 confidants, was the replacement for Diane DelValle as
8 far as being his office assistant, and we told her we
9 were going to be actually having this particular
10 officer call and she was to field the call and then
11 prepare an e-mail much like the one you just read.
12 Q. So she knew there was, in fact, no true
14 A. She knew that we were utilizing the police
15 to keep Manfredi at bay, yes.
16 Q. Did she also know of your fraudulent
17 billing scheme?
18 A. She did and Diane did.
19 Q. How do you know that she did -- meaning
21 A. I discussed it with her in Albert's
22 presence. I discussed it with her subsequently when
23 she came to work for RRA.
24 Q. When you say "came to work for RRA," she
25 actually came to work for Jewel River Cruises which
1 was located in RRA's offices.
2 Is that a fair statement?
3 A. Yes, sir.
4 Q. Was she also an RRA employee?
5 A. Well, I don't remember whether she was
6 actually on RRA's actual employee roster, but the
7 money she was being paid was coming out of RRA so I
8 use that term broadly.
9 MR. LICHTMAN: For the record, I'm asking
10 Suzi to take note that I'm giving Composite Exhibit 3
11 to my colleague, Mr. Webber, and what we'll do is get
12 a clean copy of it -- I think we have one with us
13 actually -- I suspect that Mr. LaVecchio has a
14 Sharpie that we can black out the names and probably
15 be able to give it to you today.
16 If we can't, then we'll get it to you
17 tomorrow for sure.
18 MR. GOLDBERG: What's your anticipated
19 timing today?
20 MR. LICHTMAN: I am actually I guess
21 halfway through. Maybe more.
22 Q. So, Mr. Rothstein, Composite Exhibit 2
23 which, again, for the record is Trustee documents 137
24 through 200, are what we believe to be fictitious
1 Is it a fair statement that any invoice
2 that references "confidential project" and
3 Mr. Lefebvre, that those are all totally fabricated
4 times -- totally fabricated bills?
5 A. Yes.
6 Q. I noted that one of the bills references
7 international security issues as well as domestic
8 security issues.
9 Are the international security issues
10 referenced in these bills that would be, for
11 instance, at page 143 -- are those also fictitious?
12 A. Yes.
13 Q. And page 145, which references
14 investigative services for 40,000, would that also
15 be fictitious?
16 A. Yes.
17 Q. By the way, did Mr. Lippman know that you
18 had all these fictitious invoices going out on the
19 Manfredi Lefebvre circumstance with Mr. Peter?
20 A. I don't recall one way or the other.
21 Q. Page 148.
22 If references all work performed on
23 Whitelock confidential project.
24 Was there a legitimate Whitelock
25 confidential special project you were working on?
1 A. Yes.
2 Q. There's a bill that is dated March 14,
3 2006. We didn't see any more detailed bills.
4 The bill that I'm just referencing, which
5 is at page 148, is for $86,250.
6 Is this a legitimate bill?
7 A. No. There was some minimal amount of work
8 done with reference to the Whitelock matter, but
9 nothing near that amount. This is just one of those
10 inflated bills.
11 Q. I don't want you to divulge attorney/client
12 communications, but what was the general nature of
13 the Whitelock special project?
14 A. A terminated employee threatening to sue
15 and a relationship to the Robin Lindsay matter.
16 Q. I have some legitimate bills that
17 references "Whitelock" and some legitimate bills that
18 reference "Lindsay."
19 Who would have knowledge also that a
20 portion of page 148 was fraudulent?
21 A. Me, Albert Peter, Debra Villegas, Irene
22 Stay, and likely anyone else that saw the bill that
23 actually knew what was being done on the file.
24 Q. At page 149 it's a bill -- March 14,
25 2006 -- in the amount of $37,525.
1 I know that there was an actual file for
2 Arent Fox. This says: Confidential investigation,
3 Arent Fox.
4 Is this a legitimate bill?
5 A. No. It's totally false.
6 Q. If you would take a look at page 151,
7 please. This page references a matter Silversea
8 Cruises LTD versus Wendy Clayton dated April 5, 2006,
9 invoice number 62819, and this seeks $200,000 as a
10 refundable investigative retainer.
11 Do you recall the circumstances of payment
12 of that retainer?
13 A. I do.
14 Q. Was this a legitimate retainer request?
15 A. No.
16 Q. Can you describe the circumstances of this
18 A. Albert and I needed $200,000 out of
19 Silversea. We had an issue with regard to billings.
20 We were looking for an alternate avenue to get more
21 money out. We had an active file called "Clayton"
22 that we thought we could justify this expenditure so
23 we created this bill.
24 Q. Do you recall what you needed the money for
25 at that point in time?
1 A. No. It would have been anything from
2 Albert's expenses to my expenses to firm expenses to
3 Ponzi expenses to co-conspirator expenses -- the
4 whole myriad of items.
5 Q. To the best your recollection this money
6 was paid?
7 A. To the best of my recollection, yes.
8 Q. Take a look at 155, please. That's an
9 invoice that is dated May 9, 2006. It's Silversea
10 Cruises versus Damian O'Connor.
11 This is also a confidential project and
12 this provided accounts payable funds to be returned
13 upon completion of the project for $250,000.
14 Was there a Damian O'Connor matter?
15 A. Yes.
16 Q. Was this a legitimate bill?
17 A. No.
18 Q. What were the circumstances that led to
19 your preparing this bill?
20 A. Identical to the ones I discussed with
21 regard to the $200,000 investigative retainer.
22 Same type of circumstance.
23 Q. And Mr. Peter had involvement in this one,
24 as well?
25 A. Yes, sir.
1 Q. Take a look at 156, please.
2 Do you have that?
3 A. Okay.
4 Q. This is what appears ---
5 A. I do.
6 Q. This is what appears to be a legitimate
7 bill on Silversea versus Damian O'Connor.
8 However, if you take a look at page 157,
9 you'll see a time entry May 15 for your time of four
10 hours and 15 minutes, and that comes out to a rate of
12 Was that an intentional defalcation or was
13 that a typo that got missed?
14 A. I don't know.
15 Q. You would agree that your hourly rate times
16 four hours did not amount to $44,000, though.
18 A. Yes. It looks like a mistake.
19 Q. If you take a look at page 159, this looks
20 somewhat like the form of a partially legitimate bill
21 on the Wendy Clayton matter.
22 Do you have that in front of you?
23 A. 159?
24 Q. Yes.
25 A. Yes.
1 Q. Is it a fair statement that any of
2 your -- meaning RRA's -- legal fee statements that do
3 not show the time allotted per task and the extension
4 of the fee on an hourly rate would be a fabricated
5 bill as reflected by the final gross total, which on
6 this exhibit at page 161 is 68,000?
7 A. A bill that is set up like this bill
8 without indicating the timekeeper or the time entry
9 with a total would be one of the following: Either a
10 completely fake bill or a partially fake bill.
11 Q. Is the Clayton file one that was worked on
12 also by Mr. Lippman?
13 A. I don't recall. You'd have to look at the
14 file itself.
15 Q. I noted that there's some entries in late
16 June with lawyers from New Jersey, Howard Jaslow and
17 Stan Goldberg, whom I know were friendly to
18 Mr. Lippman.
19 Do you know -- were they involved in this
20 case or were their names made up for purposes of this
22 A. No. My recollection is -- now that you're
23 saying that -- my recollection is that we did get
24 Lippman involved in this and we really did need to
25 retain lawyers out in Jersey.
1 Q. Take a look at 169.
2 A. And, Mr. Lichtman, just let me just add
3 this. The fact that I'm seeing Melissa Lewis' name
4 in here, Chris Sharp's name in here, who are both
5 legitimate attorneys, and Michael Pancier's name --
6 same as regard to him -- indicates this was a real
7 matter on a billing where we created a partially
8 fraudulent bill.
9 Q. Take a look at 169, if you would, please.
10 A. Okay.
11 Q. Is it a fair statement that this document,
12 which is on the Damian O'Connor matter but has only
13 this one entry for all items relating to account,
14 that this would be a fraudulent bill?
15 A. Yes.
16 Q. It would be fair statement then, so I don't
17 have to go through the rest of this stack of
18 invoices, that any time you reference a legitimate
19 case, but it has a one-line entry with a sum of money
20 that's due, those would be fabricated bills?
21 A. That's correct.
22 Q. And is it correct then that one of the
23 reasons that you needed to keep Mr. Lefebvre out of
24 the country was you didn't want him here possibly
25 investigating in any greater detail the amount of
1 attorneys' fees that were being incurred by
3 A. Correct.
4 Q. I don't think I need to spend more time
5 going through each of these. I think that we have
6 our foundation there so I'm going to move to a
7 different area then.
8 The corollary to the fabrication of all
9 these bills is that somewhere along the line there
10 needed to be payments to Mr. Peter.
11 You agree that he was paid money out of the
12 proceeds that RRA was paid for these inflated or
13 altogether fake invoices?
14 A. He was.
15 Q. Do you recall the sources of how money was
16 filtered directly or indirectly to him or to those
17 who he directed money to be sent?
18 A. Yes. You know when you say "out of the
19 proceeds," Mr. Lichtman, I don't want there to be an
20 inappropriate belief that we actually took that exact
21 money and then funneled it to him.
22 What would happen is that money would go to
23 us, we would use whatever we needed for our purposes,
24 and we would also then funnel amounts commensurate
25 with what we were billing to Mr. Peter through
1 various sources.
2 Q. Let me make sure I understand what you're
4 You got some and he got some?
5 A. Yes.
6 Q. Virtually always you agreed on the amounts?
7 A. Yes.
8 Q. Do you recall generally the sources of how
9 you got money to Mr. Peter?
10 A. Yes.
11 Q. Would you describe them generally. I'm
12 going to go through them specifically after you state
13 them generally.
14 A. Fake payroll, cash, other checks written to
16 That's all I recall at this moment. There
17 may be more.
18 Q. Do you recall whether or not for
19 instance ---
20 A. Wait. Wait. Wait.
21 Q. Yes.
22 A. Payments to other people on his behalf.
23 For example, Diane DelValle.
24 Q. Okay. I'm going to work through those,
1 Let me first start with Ms. DelValle.
2 The records of RRA reflect that
3 Ms. DelValle was paid compensation in calendar year
4 2005 as contract labor with a corresponding Form 1099
5 in the amount of $57,692.12.
6 Was Ms. DelValle an employee of RRA in
8 A. No.
9 Q. Why was she paid 57,000 and change in 2005?
10 A. Because Albert asked me to pay her.
11 Q. Why did he ask you to pay her? What did he
12 say to you?
13 A. He said she's going to create a problem
14 with him and Tatiana, or him and somebody else, with
15 his wife, if she's not properly taken care of, and
16 that he wants part of the money that would be going
17 to him to go to her.
18 Q. Sounds like we'll call it "hush money."
19 Would that be an appropriate way to
20 describe it?
21 A. Yes.
22 Q. Did any of that payment have anything to do
23 with Mr. Coniglio?
24 A. I don't know one way or the other.
25 Q. Would you agree that keeping Ms. DelValle
1 happy, though, would have been important to
2 Mr. Coniglio?
3 A. Let me withdraw that.
4 As you said that something popped into my
5 head. I was actually directly told by Mr. Coniglio
6 to make certain that I talked to Albert, okay, and
7 to make certain that part of the moneys that belonged
8 to Albert were paid to Diane because it was the right
9 thing to do, and I recall having that conversation
10 outside at Runway 84 on more than one occasion when
11 Mr. Coniglio actually came up to me and told me he
12 needed to talk to me and told me what needed to be
14 Q. Would you agree that if Mr. Coniglio told
15 you that needed to be done, that wasn't a request in
16 your mind -- that was an order?
17 A. Yes.
18 Q. And you would not want to disobey an order
19 from Mr. Coniglio because that could have unfortunate
20 results. Is that a fair statement?
21 A. I did not want to disappoint any members of
22 my Thursday night dinner crew.
23 Q. So to the best of your knowledge is the
24 money that was paid in 2005 to Ms. DelValle proceeds
25 of part of the theft from overbilling?
1 A. Yes. It's part of the money that would
2 have ordinarily gone to Albert Peter.
3 Q. In 2006 Ms. DelValle received $69,192.11.
4 Would your answers be the same as to why
5 she was paid that money?
6 A. Yes, sir.
7 Q. And in 2007 she received $53,846.
9 A. Same exact set of circumstances.
10 Q. Now, you know that Mr. Peter was no longer
11 employed by Silversea by probably late January, 2007.
12 Are you familiar with that?
13 A. Yes, but he was still owed money out of
14 money that we had embezzled from the company. He
15 believed that he had it coming and I had no problem
16 giving it to him and/or giving it to Ms. DelValle
17 given two things: One, the fact that I couldn't have
18 Albert all out of whack because he would have to
19 worry about Diane going to Iris and, two, I did not
20 want either Albert or I or anyone else in my firm to
21 have a problem with Mr. Coniglio and his friends.
22 Q. I think I know the answer, but to be sure:
23 You didn't keep a ledger of money in and out with
24 respect to the Silversea overbilling or fraudulent
25 billing, did you?
1 A. No, sir.
2 Q. Nor did you keep a ledger as to what you
3 paid out to anybody directly or indirectly of the
4 proceeds that came from that other billing.
5 Is that a fair statement?
6 A. That's correct, sir.
7 Q. In 2008 Ms. DelValle received $43,076.80.
8 Is that the same circumstance that you just
9 described for 2007 -- that Mr. Peter's still had a
11 A. Yes, and the impetus from Mr. Coniglio.
12 Q. Is it a fair statement that Ms. DelValle
13 from 2005 through 2008 never was an employee or
14 performed any services for RRA?
15 A. That's correct.
16 Q. The books and records of RRA also reflect
17 that Ms. DelValle received $1,000 in 2005.
18 This did not go through ADP by the way.
19 $5,000 in 2006 and $13,000 in 2007.
20 Were those also payments that were for
21 the benefit of Ms. DelValle resulting from the
22 overbilling and fraudulent billing with Albert Peter
23 at Silversea?
24 A. Yes.
25 Q. The books and records of RRA also reflect
1 that Mr. Peter received payroll checks totalling
3 The first such payment came March 09, 2007.
4 They were payments in the amount of $9,615 and they
5 continued until May of 2009.
6 Are you familiar with those payments?
7 A. I am.
8 Q. They appear to have been made on a regular
9 basis every two weeks out of RRA's payroll account.
10 Do you agree with that?
11 A. Yes, sir.
12 Q. Did Mr. Peter ever provide any services of
13 any nature for RRA?
14 A. No, sir.
15 Q. What was the purpose of paying Mr. Peter
16 biweekly compensation of $9,615.38?
17 A. It was payment to him of money he had
18 coming to him from the Silversea embezzlement.
19 Q. Did you discuss that with him specifically?
20 A. Yes.
21 Q. How much money did you feel that he had
22 coming to him all total?
23 A. We had stolen so much money from Silversea
24 in total I don't think I ever thought about it. He
25 was a solid co-conspirator, and I was going to make
1 sure that he was properly taken care of.
2 Q. These payments began shortly after his
3 termination from Silversea.
4 Do you recall that?
5 A. I do.
6 Q. Is there a correlation between his
7 termination from Silversea and the payments starting
8 very shortly thereafter?
9 A. There is.
10 Q. Would you describe that, please.
11 A. Yes. At the time that Mr. Lippman and I
12 were talking to Albert and trying to get him to go
13 quietly into the night out of Silversea's employ we
14 finally said to him -- because he was concerned about
15 his finances -- we finally said to him that, "Listen,
16 you've got plenty of money still coming to you from
17 the money we took from Silversea. You've got plenty
18 of money still coming, so we'll just put you on
19 payroll and you'll be fine and you can work on the
20 other projects in the meantime that we were going to
21 do together, like Jewel River."
22 Q. Mr. Lippman participated in that
24 A. He was present during the conversation.
25 He did not say anything about that as he did not have
1 the authority to say that, but he was present.
2 Q. I'm going to spend some time on his
3 termination in just a few minutes.
4 Next is what has been labeled in the RRA
5 case as the Lippman nest egg account.
6 Are you familiar with that account?
7 A. I am.
8 Q. Can you describe for me your understanding
9 of what the Lippman nest egg account is?
10 A. It was an account established by myself,
11 Mr. Lippman and Mr. Rosenfeldt utilizing a previously
12 existing formerly legitimate Lippman, Valinsky
13 account for the purpose of taking money out of RRA,
14 funneling it through Lippman, Valinsky in a check
15 kiting scheme that was geared both to assist RRA and
16 pay money to me, Mr. Lippman and Mr. Rosenfeldt above
17 and beyond other moneys we were receiving that we
18 could then not have to declare on our taxes.
19 Q. Would you describe for the record your
20 understanding of what a check kiting scheme is?
21 A. It's playing the float on checks between
22 two different or multiple different banks.
23 Q. Is it your understanding that is not legal?
24 A. It is illegal.
25 Q. I have before me copies of account
1 statements from the Lippman, Valinsky and Storfer
2 operating account at Equitable Bank.
3 I have four checks that were made payable
4 to Mr. Peter in the timeframe of December 7, 2006
5 through January 12, 2007. Those checks total
7 Do you know what the reason was as to
8 why there were checks written out of the Lippman,
9 Valinsky and Storfer account to Mr. Peter?
10 A. It's one of several possibilities.
11 One, it was money that Albert needed that
12 he felt he was still owed, and which I agreed that he
13 was still owed, from the Silversea embezzlement where
14 at a time where we did not have sufficient funds at
15 RRA to pay him so we had to use the check kiting
16 scheme, or it was a time when he was due payments
17 from the Ponzi scheme and we did not have sufficient
18 funds in the RRA accounts, Ponzi accounts, to pay him
19 so we used the check kiting scheme to get the funds
20 to him. One or the other.
21 Q. The timing of these checks being late
22 December, 2006 to mid January, 2011 -- does that help
23 refresh your memory any?
24 A. No. The only thing that would refresh my
25 recollection is to look at the amounts and try to
1 match them and see if they match deal payments he was
3 If they matched deal payments he was due
4 then it matches to illegitimate funds he was entitled
5 to out of the investment fraud. If it does not match
6 any of those deal e-mails, then it is money that we
7 were giving to him from the Silversea embezzlement
9 Q. How did it happen that these checks were
10 written out of what you've called or is now known as
11 the nest egg account? Did you direct them to be
13 A. I did.
14 Q. Who did you direct?
15 A. I would direct Irene Stay to cut the float
16 check to either Lippman or the Lippman Valinsky
17 account, at the same time requesting that Mr. Lippman
18 cut the reverse float check back out to us, or to
19 whatever party I was having it paid to, instructing
20 him when to deposit our check.
21 Q. There is also a $400,000 payment that was
22 made -- hold on. Off the record. I want to get the
23 documents. I need one minute to get all the
25 A. That's all right. I'm going to use the
1 restroom in the meantime.
2 (Short Break)
3 Q. On October 24, 2006 there was a transaction
4 whereby Silversea Cruises wire transferred money to
5 RRA, $400,000, and it was allegedly for the benefit
6 of Albert Peter. Then money went out to Tatiana
8 Are you familiar with that transaction?
9 A. I am.
10 Q. Ms. Yoel has taken the position that this
11 is money -- and Albert Peter has done the same --
12 that this is money that Silversea owed to Mr. Peter.
13 Do you have any knowledge of whether or not
14 that is true or not true?
15 A. It's a lie.
16 Q. How do you know it's a lie?
17 A. I discussed the issue with Albert Peter.
18 Q. What did Albert say to you?
19 A. He told me that he needed to get $400,000
20 to Tatiana in order to purchase a property together
21 because she was going to leave him if they didn't
22 start cementing their relationship.
23 I told him that we did not have sufficient
24 funds in-house to just simply send her $400,000 given
25 everything that was going on.
1 He said, "I can send it to you from
2 Silversea if you'll then forward it to Tatiana," and
3 I said I would and did.
4 Q. Are you aware that this was $400,000 that
5 was used to purchase a condominium for Tatiana on
6 South Beach?
7 A. Yes.
8 Q. Did Tatiana provide any services or benefit
9 of any nature to RRA in connection with this
11 A. No, sir.
12 Q. Did Albert provide any benefit or services
13 to RRA in connection with this $400,000?
14 A. Legitimate services? No, sir.
15 MR. GOLDBERG: I'm glad the term "cementing
16 the relationship" now has come to mean buying real
17 estate with cement for them.
18 Q. I think that the transaction took an
19 interesting turn in that money went from Silversea to
20 RRA's account.
21 Do you agree with that?
22 A. I recall that. Yes, sir.
23 Q. And that was not for money that was owed by
24 Silversea to Mr. Peter.
25 You agreed with that. Correct?
1 A. Yes, sir.
2 Q. Then I believe that money went from RRA to
3 an account in Ms. Yoel's name in Zurich.
4 Are you familiar with that?
5 A. I seem to recall that being the case.
6 Do you have the wire document?
7 Q. I do have the wire document.
8 Actually, if you take a look at
9 Trustee AP00085 ---
10 A. One second, please.
11 Yes. I see that.
12 Q. I want to lay a foundation.
13 Are you aware that Ms. Yoel had a bank
14 account located in South Florida?
15 A. I don't know one way or the other. I would
16 imagine she did -- she lived there -- but I don't
17 know one way or the other.
18 Q. If Ms. Yoel was intending to buy a
19 condominium with this $400,000 -- and I'll proffer to
20 you that it is not in dispute that the money was used
21 for that purpose -- can you explain why, if you know,
22 she directed the money to go from RRA's account to an
23 account in Switzerland to buy property in South
25 A. She directed no such thing. That was
1 directed by Albert.
2 Q. Do you know why Albert directed that?
3 A. The only thing that I know is that he told
4 me to send it to this particular account in
6 Q. I have an e-mail that is marked -- I'm
7 going to mark it as an exhibit.
8 It's an e-mail -- sort of a composite of
9 sorts -- that includes this -- all the communications
10 on it.
11 This is going to be Exhibit 4, which we'll
12 give to the court reporter.
13 It's an e-mail trail with you and,
14 effectively, Albert on one hand getting copied,
15 John Harris and Lisa Ellis.
16 (Whereupon, the document referred to was
17 marked Plaintiff's Exhibit No. 4 for Identification.)
18 Q. On October 24, 2006 you wrote to Mr. Harris
19 and Ms. Ellis with a copy to Irene Shannon and a copy
20 to Albert the following: Pursuant to instructions
21 received from Albert Peter in his capacity as CEO of
22 Silversea Cruises LLC please wire 400,000 which we
23 have been holding for Silversea's benefit in our
24 trust account 0050012053 to the account below
25 immediately. Thanks in advance for your prompt
1 attention to this most urgent matter. Should you
2 have any questions please free to call me directly.
3 Should you have any questions regarding the wiring
4 data below, you may contact the bank at the numbers
5 listed below. Please provide me with confirmation of
6 the wire via your bank's standard e-mail protocol.
7 Thanks again, Scott.
8 Do you recall that e-mail?
9 A. I do.
10 Q. Tell me what you recall about the
11 circumstances surrounding your drafting and sending
12 of that e-mail.
13 A. It was subsequent to me receiving
14 instructions from Albert as to somehow he wants to
15 dispose of the $400,000 that he had embezzled from
16 the company.
17 Q. Did he discuss with you the nature of the
18 account that was in Ms. Yoel's name in Zurich?
19 A. I don't recall one way or the other, other
20 than telling me to send the money there.
21 Q. Was this $400,000 in any way related to the
22 fraudulent scheme that you described here earlier
24 I note that it came at the same point in
1 A. You'd have to see if it ties to one of the
2 fraudulent bills.
3 I mean off the top of my head I don't know
4 how Albert would have directed the money to get to me
5 unless I sent him a fraudulent bill so that he could
6 send it, so I can't tell you without seeing the
8 Q. Your understanding from your direct
9 conversations with Mr. Peter was he admitted to you
10 that it was an embezzlement?
11 A. Not using those words, but, yes, he said,
12 "I'm just going to take the money from Silversea and
13 you'll send it from there," because he originally
14 asked me, Mr. Lichtman, if I could just send her the
16 Q. When he said, "Could you just send the
17 money," that would have been because he would have
18 hoped that he had about at least $400,000 somewhat
19 coming to him as a result of the fraudulent billing
21 Is that a fair statement?
22 A. That's a fair statement. Yes, sir.
23 Q. This is probably a fairly good breaking
24 point right now for lunch if it works for you.
25 A. Whatever is good for you is good for us.
1 Q. Whatever is good for you is good for me.
2 MR. LaVECCHIO: All right. What time do
3 you want to be back?
4 THE WITNESS: Let's break.
5 MR. LICHTMAN: Half hour?
6 MR. NURIK: Half hour.
7 THE WITNESS: See you then.
8 MR. LICHTMAN: I'm well through my
10 (Whereupon, a lunch break was taken, after
11 which the deposition resumed)
12 Q. Yesterday briefly in the Rule 2004 exam,
13 Scott, you mentioned something about fake bonds as it
14 pertained to Silversea Cruises and Albert Peter.
15 Do you recall that?
16 A. I do.
17 Q. Describe for me the transaction or events
18 that you were alluding to in a general sense and then
19 we'll narrow it down from there as it pertains to
20 these fake bonds.
21 A. On several occasions one of the
22 methodologies that Albert and I used to embezzle
23 money from Silversea was by telling those in control
24 at Silversea that we had to pay certain bonds and the
25 like. Paperwork was submitted to support it and the
1 moneys were paid.
2 Q. Where would I find those documents? What
3 do they look like?
4 A. They should be e-mails.
5 Q. Is there anything besides the e-mails? Are
6 there, for instance, like fake bond documents?
7 A. No, sir.
8 Q. The Morse case comes to mind where you had
9 like falsified court orders from Judge Marra.
10 You recall that obviously?
11 A. I do.
12 Q. Are there any fake court orders that I
13 should look at or is it simply follow the e-mail
15 A. I don't recall doing any fake documents
16 with regard to the Silversea. It was a much easier
17 thing because of Albert's position in the company.
18 Q. Meaning because he was inside and because
19 he was complicit with you, you could accomplish that
20 which you needed?
21 A. Yes.
22 Q. Do you recall what cases the bonds
23 pertained to?
24 A. I do not.
25 Q. Were they actually existing cases?
1 A. They may have either been existing cases or
2 made up cases. Probably existing cases, but I'd be
4 Q. Let me mention some case names and see if
5 this might refresh your memory.
7 A. It may very well be.
8 Q. I'd have to just ---
9 A. There should be e-mail traffic saying to
10 the people at Silversea that we've got to post this
12 Q. What was the typical amount that you were
14 A. I distinctly -- I don't think there was a
15 typical amount. It could have been anywhere from a
16 few hundred thousand dollars -- I think I remember
17 one that was like $750,000. I don't recall exactly.
18 Q. You have an invoice for services rendered,
19 I believe, in the amount of 750,000 somewhere.
20 That was a bond deal?
21 A. I believe it was.
22 I have a very distinct recollection of
23 having a conversation with Manfredi. I was on my
24 cell phone, I believe. I was living at 2308 Castilla
25 at the time and I was out by the pool on the phone
1 with Manfredi talking to him about the need to post
2 a very large bond, and I think that was it.
3 Q. Who knew about the fake bonds besides you
4 and besides Albert?
5 A. Albert, Irene, and Debra.
6 Q. Did they prepare any paperwork that
7 facilitated the fake bond scheme or was it just
8 purely the e-mails that you referenced?
9 A. I think it's just the e-mails.
10 Q. There came a point in time that you learned
11 that Albert was no longer going to be an employee of
12 Silversea cruises. Is that correct?
13 A. That's correct.
14 Q. Do you recall the timeframe of when you
15 learned that?
16 A. End of '06. Something like that.
17 What was his last date of employment? It
18 would have been three to four months from that.
19 Q. Well, I have a document here that you don't
20 have in front of you unfortunately. This is an
21 e-mail from you to Albert dated January 14, 2007
22 enclosing a transition agreement.
23 Does that help you?
24 A. Yeah. It would have been four to five
25 months prior to that when we first figured out he was
1 going to be asked to leave.
2 Q. What was it that led you to conclude he was
3 going to be asked to leave the company?
4 A. Conversations that he had with Manfredi and
5 conversations that I had with Manfredi and Amerigo.
6 Q. Describe the conversations that you had
7 with Manfredi and Amerigo.
8 A. They had told me that they were having
9 issues with Albert and his expense account -- Albert
10 and staff -- mostly with the expense account -- and
11 other things that they thought Albert might be doing
12 relative to the company.
13 Q. What other things?
14 A. I don't remember -- I don't remember what
15 the other things were, but the main thing was his
16 expense account and that they could not afford to
17 continue to support his lifestyle and his mistresses
18 and they were seeking advice from me on how best to
19 transition him out without getting engaged in a major
20 legal action with him.
21 Q. Was it your understanding that he was being
22 terminated with cause?
23 A. You'd have to look at the transition
24 agreement. I think that we were trying to make it so
25 that he was going to get out clean, but I don't
1 recall what we put in the termination agreement --
2 transition agreement. I think we tried to make it
4 Q. I'm not talking so much about what the
5 agreements provide. I'm talking about the de facto
6 reason why Albert was leaving Silversea.
7 What was your understanding as to whether
8 Albert's termination was with cause or without cause?
9 A. With cause.
10 Q. And was the "with cause" termination for
11 those reasons that you indicated just a couple
12 moments before -- dealing with his expense account
13 issues, supporting girlfriends, et cetera?
14 A. Yes.
15 Q. You realize that the $400,000 payment for
16 the benefit of Tatiana Yoel and her condominium came
17 in October, 2006.
18 Do you have any basis to know whether or
19 not that payment was one of the reasons why Albert
20 was being terminated with cause?
21 A. I don't recall specifically, Mr. Lichtman.
22 I just recall the fact that both Manfredi and Amerigo
23 both believed that Albert was embezzling money from
24 the company and they needed to bring it to a stop.
25 Q. That's their language?
1 A. Amerigo used the word "embezzled" --
2 Amerigo used the word "embezzlement" -- and Manfredi
3 used the words "stealing from me".
4 Q. When you learned this from Amerigo and from
5 Manfredi, what did you do?
6 A. I told Albert.
7 Q. What did Albert say?
8 A. That he had already had a couple of
9 conversations with Manfredi where Manfredi was
10 clearly on the cusp of terminating him and that he
11 had a feeling it was coming based on the way Amerigo
12 and Manfredi were acting and that I needed to do
13 whatever I could to either try to save his job or
14 protect him on the way out.
15 Q. And what did you do?
16 A. At various points in time I tried to
17 massage the situation to keep Albert there because
18 he was a cash cow for us there.
19 Subsequently when it was clear that the
20 handwriting was on the wall and he was going to
21 be -- he was going to leave politely or he was
22 going to be forced out -- I had several meetings
23 with Albert where I told him that I would protect
24 his interests and he just needed to work with me
25 and follow my instructions. That's all.
1 Q. And how was it that you were contemplating
2 protecting his interests?
3 A. By guiding him into avoiding conflict and
4 by lying to Manfredi and Amerigo about what was going
5 on so that they would feel that it was in their best
6 interest to release him with this transition
7 agreement as opposed to engaging in an all out war
8 with him.
9 Q. When you say you were lying to them about
10 what was going on, what was it you were lying about?
11 A. I told them that they were on poor legal
12 footing with regard to their claims against him. I
13 told them that he was extremely vindictive and that
14 Manfredi could expect to have all his dirty laundry
15 aired in public in the cruise community, which is a
16 very small close-knit community.
17 Q. So I think we've now moved from the
18 category of what you contemplated doing to what you
19 actually did to protect Albert.
20 Those three things that you just
21 mentioned -- those are things that you actually did
22 then -- in terms of telling Silversea that they were
23 on poor legal footing, that Albert was vindictive,
24 and that Albert would air Manfredi's dirty laundry.
25 That's really two things.
1 Is that ---
2 A. Yes. I basically, for lack of a better
3 term, explained the doctrine of mutually assured
4 destruction to Manfredi as it applied to Manfredi,
5 Silversea and Amerigo, that no one was going to win
6 if he fired Albert, that they best part on good
8 I also lied to him and told him that we
9 needed Albert as a positive witness for us in other
10 litigation that we had, and that it was to nobody's
11 benefit to terminate him.
12 Q. Was the issue of reputation to Manfredi
14 A. Extremely.
15 Q. Tell me your understanding as to why that
16 was so important to him.
17 A. You have to know Manfredi and have spent
18 significant time with him to really understand,
19 but he is -- as far as his public persona he was
20 Roman -- not just Italian, but Roman Italian. Came
21 from an extremely wealthy family.
22 My understanding is that his father was
23 actually legal counsel to Mussolini and he was very
24 well respected, a citizen of Monaco, a citizen of
25 Rome, Italy, and that these kind of things -- almost
1 like royalty -- and that anything of this nature that
2 would cause a smear on the family was frowned upon.
3 On top of that, most critically, one of
4 the biggest pressure points that I learned about from
5 Albert subsequently discussed with Manfredi to be
6 utilized was that Manfredi had an extremely
7 adversarial relationship with his brother and they
8 were both vying for their father's affection and
9 money, and so he could not afford to have anything
10 like this made public.
11 Q. And, hence, you used against Manfredi the
12 potential scandal of him having visited with
13 prostitutes in South Florida as the tool to control
15 Is that a fair statement?
16 A. Yes. That, in combination with something
17 that Albert had told me about that I confirmed
18 ultimately with Manfredi when I confronted him about
19 it, that some money had actually been embezzled by
20 Manfredi out of the company through the purchase and
21 sale of expensive paintings.
22 Q. Did that, in fact, occur, to the best of
23 your knowledge?
24 A. To the best of my knowledge, yes.
25 Q. Was that part of a lawsuit?
1 A. I don't recall it being part of a lawsuit.
2 If it was, it was unbeknownst to me, but I do recall
3 the fact that -- I remember discussing with Manfredi
4 and Amerigo the fact that they were having problems
5 with other shareholders of Silversea relative to the
6 amount of money Manfredi had taken out of the
7 company, and some things with some artwork on some
8 ships and the like.
9 Q. There was some litigation involving a
10 foreign company I believe that was suing and trying
11 to assert that Manfredi had participated in the
12 conduct of Silversea's business and you needed to
13 establish that he really wasn't active or in control.
14 Do you recall that generally?
15 A. I do. What was the name of that
16 litigation? I do recall that.
17 Q. I don't recall right now. Something
18 Etcie, E-T-C-I-E?
19 A. Yes. Yes. Bingo.
20 That's the litigation that Lippman was
21 working on.
22 Q. In that litigation, was that case handled
23 above board, or was there impropriety in handling
24 that case?
25 A. There was impropriety in handling that
1 case both from a transmittal of false information to
2 opposing counsel and to the courts and phony
4 Q. I think it's Attel, A-T-T-E-L.
5 Does that sound right?
6 A. Yes. That is right, and the actual
7 managing lawyer to the Attel litigation to the best
8 of my recollection was Steve Lippman.
9 Q. What was the false information that was
10 transmitted to Courts?
11 A. I'd have to see the file, Mr. Lichtman.
12 Q. Do you have a general recollection?
13 A. There's a lot of it. It had to do with how
14 much control Manfredi had over certain things and it
15 had to do with where he lived most of the time, his
16 residence. There were all kinds of things.
17 Really, if I could see the file I could be
18 of tremendous help with regard to that specific set
19 of issues because I had totally forgot about that
20 case until you just started talking about the foreign
22 Q. Who was responsible for submitting false
23 information to the Court?
24 A. Me, Mr. Lippman, Manfredi, Amerigo and
25 Albert, to the extent that he was present during
1 those times.
2 Q. Is this in the form of affidavits?
3 A. Yes.
4 Q. So if I was to pull the affidavits, that
5 would probably lead me in the direction and you
6 could confirm later whether or not they were false
8 Is that a fair statement?
9 A. I could, and I could probably also tell you
10 anybody else that may have been involved with that
12 You actually have to look inside -- you
13 actually have to look inside the files, Mr. Lichtman,
14 because there was a period of time when every bill
15 going to Silversea was eventually changed or a bulk
16 of entries were changed to my initials despite the
17 fact that I was doing very little actual legal work
18 on the files for billing and appearance purposes, but
19 if you look on the inside of the file you'll be able
20 to tell who was actually doing the work and who was
21 involved in the fraud.
22 Q. Do you recall who changed the billing
24 A. Myself and Mr. Lippman.
25 Q. Do you recall who drafted the false
2 A. I'd have to see the affidavits to tell you
3 for certain.
4 Q. Did you discuss with the team that you had
5 just mentioned before the fact that the information
6 contained within the affidavits was false?
7 A. I did.
8 Q. And was that submitted to the Court in
9 order to obtain a specific result?
10 A. My recollection is that it was.
11 Q. Was this federal court or state court?
12 A. I don't recall one way or the other.
13 You've got to look at the file.
14 Q. Was there also fraudulent billing in
15 connection with this file?
16 A. There was.
17 Q. I actually didn't know I was going to be
18 getting into that right now so I want to go back -- I
19 think that I've covered that for now, but I want to
20 go back to the issue of Albert's discharge from the
22 A. Okay.
23 Q. You said that you had lied to Silversea in
24 stating that their claim was on poor legal footing.
25 Did I hear you correctly?
1 A. I'm sorry. Can you repeat the question?
2 Q. You said that you had lied to Silversea
3 about them being on poor legal footing with respect
4 to Albert's termination from the company.
5 Did I understand you correctly?
6 A. Yes, sir.
7 Q. Did Mr. Peter have an employment agreement?
8 A. I don't recall whether he did or not.
9 Q. Do you recall if he was terminable at will?
10 A. I don't recall off the top of my head.
11 I'd need to see the agreements and the
12 transition agreement. I just don't recall.
13 Q. What is it that you recall lying to
14 Silversea about concerning Mr. Peter?
15 A. The main thing was that he was going to go
16 to the media and blast Manfredi.
17 The other thing was that if they did engage
18 in litigation with him, that the skeletons in
19 Manfredi's closet and in the company's closet would
20 ultimately be exposed, placing them on weak legal
21 footing and also poor PR footing if they proceeded
22 with such litigation.
23 Q. When you used the phrase earlier "poor
24 legal footing," were there legal theories of relief
25 or legal arguments that you misstated to Silversea?
1 A. I don't recall that we specifically got
2 into very many actual legal discussions. Manfredi's
3 main thing was to avoid the expenditure of what I
4 told him would be hundreds of thousands of dollars in
5 additional legal fees, only to have no one actually
6 really win the litigation, but, on the other hand, if
7 they let him go nice and quietly under at least
8 semi-decent terms, that they would have a friend if
9 there was future litigation that he needed to testify
10 in, and since it was likely that Albert was going to
11 remain in the cruise industry, that he would be able
12 to engage on a professional level with him as opposed
13 to an adversarial level.
14 Q. Did Albert know that you were having these
15 conversations with Silversea where you were telling
16 Manfredi and Amerigo that Albert was going to be
17 vindictive and divulge all of this highly sensitive
18 information about Manfredi?
19 A. Yes.
20 Q. How is it that he knew?
21 A. How did Albert know that?
22 Q. Yeah.
23 A. Albert and I discussed it. We came up with
24 the whole plan.
25 Q. How often did you discuss that with Albert
1 once it became clear he was leaving the company?
2 A. Sometimes daily. As we got closer and
3 closer to the trip to London to finally put an end to
4 this it was daily I was having meetings with Albert.
5 I was having meetings with people at my law
6 firm to discuss strategy. I was having at the very
7 least telephone meetings with Manfredi and Amerigo
8 about this, and strategizing as to how we were going
9 to put this in play.
10 I was doing everything I could to work both
11 sides to make sure that this went smoothly.
12 Q. Is it a fair statement that Silversea
13 representatives, specifically Amerigo and Manfredi,
14 did not know that you were during this period of time
15 communicating daily with Albert Peter?
16 A. I don't know if they knew how much I was
17 communicating with him. I do believe that they had
18 no idea what I was communicating with him about.
19 Q. Let me rephrase the question, because I
20 think from reading some e-mails -- and tell me if I'm
21 wrong -- they actually knew that you were having some
22 communications with Albert because you were
23 intentionally acting as a go-between to pacify the
25 Is that a fair statement?
1 A. Yes, sir.
2 Q. What they didn't know was that you were as
3 close to Albert as you were and that you were working
4 the situation for his benefit. Is that correct?
5 A. That's correct.
6 Q. You certainly did not say to anyone at
7 Silversea that you were completely independent and
8 were representing only Silversea's interests and
9 divulge that you were actually working at the same
10 time for Albert's interests. Correct?
11 That was terrible. That's a bad question.
12 (Discussion off the record.)
13 Q. It's a fair statement that you never told
14 anyone at Silversea that you were actually
15 negotiating for the benefit of Albert. Correct?
16 A. That's correct.
17 Q. Did you ever tell anyone at Silversea that
18 you were going to tell Albert to get independent
20 A. Yes.
21 Q. Did you get Albert independent counsel?
22 A. No. Oh. Wait a second. You know what?
23 We may have had someone pretend to be Albert's
25 Q. I saw an e-mail that suggested as much.
1 A. I totally forgot about that.
2 Q. Would that have been, by chance, Doug
4 A. I believe you're correct.
5 (Discussion off the record.)
6 Q. Did there come a point in time where
7 Albert was, in fact, terminated?
8 A. Well, there was a transition, yes. He
9 left the company.
10 Q. I have in front of me -- these are some
11 of the documents that I received from Silversea
12 afterwards, and we didn't see anything in the RRA
13 files, but it's an e-mail dated January 14, 2007 that
14 you sent to Albert that enclosed a transition
16 It discusses "your smooth and amicable
17 transition from CEO at Silversea to Deputy Chairman
18 of Silversea Leisure and Travel."
19 Do you recall preparing that agreement
20 and the cover e-mail?
21 A. I do.
22 Q. First, by January 14th when you prepared
23 this transition agreement, or transmitted the
24 transition agreement, was Albert already gone from
25 being an employee or was he still there?
1 A. I think at that point in time -- you know
2 what, Mr. Lichtman? I'd be guessing.
3 I have a recollection that at the very end
4 he'd be locked out of the offices, but I can't be
6 Q. The letter that you referenced discusses
7 his transitioning from CEO at Silversea Cruise
8 Holding LTD -- that was the position that he held
9 while you were embezzling money with him. Correct?
10 A. That's correct.
11 Q. And he was moving to become deputy chairman
12 of Silversea Leisure and Travel.
13 Did you recall that?
14 A. I recall that, but that's just a crock.
15 Q. Yes. When you say "crock," what do you
16 mean by that?
17 A. I apologize.
18 It was a created position so as to enable
19 them to properly publically transition Albert out of
20 the company without smearing him all over the place.
21 Q. Was it your idea to come up with that
23 A. It was Albert's idea.
24 Q. What is Silversea Leisure and Travel?
25 A. I have no idea. Could be another real
1 company, but Albert never did anything for them.
2 He was supposed to be a consultant and
3 available from time to time, but there was never any
4 real involvement with that. It was a fiction.
5 Q. Purely for public relations purposes.
7 A. Yes.
8 Q. The agreement that I have, which is
9 unsigned, references a transition period of 30 days
10 from the date of execution of the agreement.
11 Unfortunately, it's unsigned.
12 Do you know if and when the document
13 actually was signed?
14 A. Eventually a document was signed. I don't
15 know if it's that document, and I don't even know if
16 it still had that position in it. I just don't
17 recall one way or the other.
18 Q. Was there more than one agreement signed,
19 because we have no signed agreements.
20 We know that you had prepared this draft
21 transition agreement and we know that there was also
22 a -- at least discussion of there being a termination
24 A. I don't recall one way or the other. My
25 recollection -- my best recollection is that there
1 was an agreement ultimately signed, but I don't have
2 specific recollection and I do not want to guess.
3 Q. I have an e-mail from -- it's an e-mail
4 from Amerigo to you. It's dated February 14, 2007.
5 That's roughly a month later.
6 In it Amerigo asks you just one
7 question -- when is Albert eventually time barred
8 on suing Silversea for any matters related to his
9 employment with the company -- and you answered
10 that same day -- actually instantly the same minute
11 -- "four years from now."
12 That suggests to me that there was no
13 release that was provided by Albert to the company.
14 Do you have any recollection or
15 understanding of that fact?
16 A. I don't know whether that's ultimately what
17 happened or whether I was simply providing that
18 information to Amerigo in the event something was
19 never signed.
20 Q. You would agree, would you not, that if
21 there was a signed agreement with a release that the
22 issue of a claim being time barred would not be
23 relevant. Correct?
24 A. That's correct, but that doesn't mean that
25 Amerigo would understand that necessarily.
1 Q. And it also doesn't mean the possibility
2 that after the date of that e-mail an agreement was
3 signed that contained a release. Right?
4 A. That's correct.
5 Q. I have an e-mail here from Amerigo to you
6 and Manfredi this is dated January 19, 2007.
7 It states: Scott, please find attached --
8 this is, by the way, Bates stamped T-AP00254.
9 Let me go back now that I put that on the
10 record. January 19, 2007, from Amerigo to you, copy
11 to Manfredi: Scott, please find attached the results
12 of the preliminary audit on Albert's T&E expenses for
13 2006. The amounts that are either definitely not
14 admissible for reimbursement or, quote, prima facie
15 not admissible for reimbursement, are over one
16 million over the 12-month period, and we are, of
17 course, missing two weeks in January.
18 Do you recall that e-mail?
19 A. I do.
20 Q. Do you recall the circumstances or the
21 facts that you were told respecting that one million
22 dollar figure?
23 A. Give me the date of the e-mail again
25 Q. January 19, 2007.
1 A. Do you have the dates that we traveled to
2 London for the meeting?
3 Q. No, but I believe it to have been after
5 A. To the best of my recollection,
6 Mr. Lichtman, as we were nearing the time for the
7 ultimate and final transition of Albert out of the
8 company, Silversea was doing everything it could to,
9 quote, unquote, load itself for bear to protect
10 itself from what it perceived -- with regard to what
11 it perceived was a threatening position that Albert
12 might take -- and so I do recall there being an audit
13 occurring and other investigations internally at
14 Silversea, both in the Fort Lauderdale office and in
15 the home office in Monaco, with regard to Albert and
16 his expenditures and the like.
17 Q. What did you learn about the one million
18 dollar overcharge of reimbursable costs by Albert?
19 A. Well, when I first heard it, it was -- I
20 remember discussing with Albert that it seemed to be
21 a lot less than Albert thought they were going to tag
22 him with, and that it was a point of pressure on
23 Albert because I was telling Albert also that he
24 could end up in a very bad position if we don't
25 resolve this, because you've got to remember it was
1 my position that I needed to satiate -- get Albert
2 out, to get Silversea out of there so that ultimately
3 this didn't come back at RRA.
4 Q. When you say "come back at RRA," because of
5 the fraudulent billing?
6 A. Yes.
7 Q. Do you know if the one million dollar
8 accounting by Amerigo included $400,000 to Tatiana
9 Yoel, or for her benefit?
10 A. I don't. No. I don't believe it did.
11 I could be mistaken, but the reason I don't
12 believe that it did, Mr. Lichtman, is because their
13 audit was a travel and entertainment audit -- that's
14 what he was referring to -- so I don't know where
15 they got that $400,000.
16 Q. That money was payable ---
17 A. You have to ---
18 Q. That money went from Silversea to RRA,
19 notwithstanding. Right?
20 A. Yes.
21 Q. There's an e-mail that Amerigo -- hold on.
22 I want to make sure it's Amerigo the way I'm reading
23 this -- no -- that Manfredi wrote to you and Amerigo
24 on January 22, 2007, and in it he talks about the
25 expenses being subject to scrutiny and other senior
1 executives have had refused expenses, but Albert's
2 were being put through.
3 It talks about -- here's a comment:
4 Morally how can someone who has been charging his
5 home expenses and presents to numerous lovers
6 complain about marginal mistakes made by making it a
7 one week of a review of the expenses that he has
8 omitted to make for over three months knowing of the
9 appropriations of which he is responsible.
10 Do you remember that e-mail?
11 A. I have a vague recollection of it.
12 Q. Do you recall having conversations with
13 Manfredi or Amerigo about the nature of the
14 overcharges, particularly as it pertained to the
15 phrase that Manfredi used, being "numerous lovers"?
16 A. Yes.
17 Q. What is your recollection of those
19 A. Manfredi and Albert were arguing over who
20 was the more morally reprehensible person. That's
21 the way the conversations -- the conversations
22 generally denigrated to that point in time.
23 It was quite candidly like children in a
24 schoolyard, and Manfredi was really pushing the point
25 that he wanted me to push the point with Albert that
1 just like that Freddy had skeletons, Albert, too, had
3 It was more of Manfredi feeling a need to
4 push back than anything else.
5 Q. You wrote back to Amerigo and copied
6 Manfredi and you said that -- this is your e-mail
7 back. It's also on January 22nd. This is page
8 T-AP00255: Amerigo, hope all is going great. Just
9 wrapped up for the evening with Albert. He's been
10 going through the expenses in detail. We made it
11 through a lot of legal issues in the agreement today.
12 Important question: Did we do anything to ensure
13 that all this belongs to him? Some of the items are
14 an impossibility. We can discuss tomorrow, for
15 example, move from South Beach to Fort Lauderdale.
16 Do you recall that portion of the e-mail?
17 A. I do not.
18 Q. I just by luck found this. I see an
19 e-mail from Albert to Manfredi dated Saturday
20 January 20, 2007, and it says: Will you be in London
21 tomorrow? I need to move forward and would like to
22 close the chapter in a mutually beneficial way.
23 Again, that's January 20th.
24 Does that refresh your recollection as to
25 when you went to London?
1 A. Yeah. It would have been right around that
3 Q. And then I have an e-mail that is -- this
4 is page 259 of January 23 where you wrote to Amerigo
5 and Manfredi: Just took a break. Albert did hire
6 an attorney and it is actually helping explain the
7 negatives from an independent source.
8 As I understand, though, there was no
10 A. No. There was someone playing an
11 attorney, but no one really talking to Albert other
12 than Mr. Lippman and myself.
13 Q. I want to be clear I understand what
14 you're saying.
15 No licensed attorney was actually retained
16 by Albert to represent him in this negotiation with
17 Silversea regarding his termination. Correct?
18 A. There was a licensed attorney paid by
19 Albert, but not to represent him in the negotiation.
20 Q. What was he paid to do?
21 A. To pretend to be his lawyer.
22 Q. And then you handled the negotiations?
23 A. Manfredi didn't know that, but yes.
24 Ultimately Mr. Lippman and myself handled
25 all the negotiations. Yes.
1 Q. So describe for me what happened in London.
2 Where did you meet?
3 A. The bulk of the meetings to the best of my
4 recollection occurred -- actually in London all of
5 the meetings occurred in hotel rooms -- either
6 Manfredi's hotel room and Albert's hotel room.
7 Mr. Lippman and I -- I don't remember if
8 they were in the same hotel or not -- I believe they
9 were -- Mr. Lippman and I shuttled back and forth
10 between the hotel rooms.
11 Some of the negotiations and conversations
12 with Albert actually took place outside. I have a
13 fairly distinct recollection of walking around
14 outside someplace in London -- me, Albert and Steve
15 Lippman -- discussing the importance of keeping this
16 smooth, as amicable as possible.
17 There were times when Manfredi was led to
18 believe that we -- that Lippman and I were down there
19 browbeating Albert -- when in reality we were out
21 Q. "We" being the three of you?
22 A. There was an occasion where we were
23 ordering -- yes -- and continued back and forth like
25 As a matter of fact, my best recollection
1 is that until the very end, until the agreement was
2 reached, that Manfredi and Albert were refusing to
3 actually meet with each other. They wouldn't have a
4 face-to-face meeting. We were the go-betweens --
5 Mr. Lippman and I.
6 Q. Actually, wasn't that better for you if
7 you wished to manipulate the process?
8 A. Yes. Yes. It was better all the way
10 Q. So Manfredi did not know that you were
11 being social with Albert during this shuttle
12 diplomacy, nor did he know that you were actually
13 effectively negotiating on Albert's behalf. Correct?
14 A. That's correct.
15 Q. And Lippman was doing that as well.
17 A. That's correct.
18 Q. A clear legal conflict of interest under
19 Florida law.
20 Would you agree with that?
21 A. Yes, sir.
22 Q. Did not divulge it to Silversea.
24 A. That's correct.
25 Q. Silversea thought that Albert had his own
1 independent counsel when he really didn't. Correct?
2 A. That's correct.
3 Q. Albert didn't disclose to Manfredi, either,
4 when they finally did get together that he was
5 unrepresented. Correct?
6 A. That's correct.
7 Q. To the best of your knowledge, was there
8 ever a point in time that anyone from Silversea
9 learned of that?
10 A. To my knowledge, no.
11 Q. Then, to be sure, I want to recap your
12 testimony from earlier today.
13 You said you also billed the time that you
14 spent with Albert to Silversea. Right?
15 A. Yes. Both Mr. Lippman and I did.
16 Q. And you inflated that time, as well?
17 A. Yes.
18 Q. To the extent that you were getting paid
19 legal fees for doing this, was any part of the bill
20 that you generated something that you believe was a
21 continuous part of the embezzlement to Silversea that
22 Albert was entitled to share in?
23 A. I certainly treated it that way.
24 Q. I have a document dated January 30, 2007.
25 It looks like it's simply a Word created document
1 with Albert's name on the top of the letterhead
2 indicating it's January 30, 2007. It's Bates stamped
3 Trustee 260 and it's Albert's signed resignation from
4 all positions as an officer or director from his
5 employer, which includes Silversea Holding LTD and
6 Silversea Cruise Lines LTD.
7 It says that there was a separation
8 agreement, general release and confidentiality
9 agreement executed January 23, 2007.
10 Does that help you pinpoint the London
12 A. It would have been right around that time,
14 Q. How many days did the negotiation on
15 Albert's contract take place over?
16 A. I don't have a specific recollection. A
18 Q. When you came back to the United States
19 was there anybody that you told that you had done
20 this with besides Steve having actual knowledge?
21 A. Stuart.
22 Q. What did you tell Stuart?
23 A. I gave him a play by play pretty much of
24 everything that occurred and told him that we had
25 extricated ourselves from the potential problems of
1 Silversea, that it was likely that we would continue
2 to represent them for at left a short period of time,
3 and that we were in a good position to move forward
4 on Jewel River Cruises, that we were able to get
5 Albert out without a non-complete that would
6 interfere with Albert's ability to run this company
7 for us.
8 Q. That suggests to me that Stuart knew about
9 your fraudulent billing scheme.
10 Would that be a fair statement?
11 A. I don't believe that Stuart knew the actual
12 mechanics of it, but he definitely knew that we were
13 inflating the bills to Silversea, and the way that I
14 know that is there was more than one occasion where
15 Stuart was joking around with me when he was looking
16 just at general receivables and the like and asking
17 me how the hell could we possibly be doing this much
18 legal work for these people, and I explained it to
19 him that these were the bills that Albert was
21 Q. When you say you explained to him these
22 were the bills that Albert was paying, did you
23 explain to him that you were padding the bills?
24 A. I told him that I was billing based upon
25 what the market could bear at the time, and that I
1 tried to explain to him how we were additionally
2 compensating Albert out of that money, because there
3 were times when Stuart would look at records and the
4 like, especially when I put Albert on payroll, Stu
5 wanted to understand why, and I explained to him that
6 we owed him the money, that we owed Albert the money,
7 and I explained to him why we owed him the money.
8 Q. Just to be sure, you know, you used the
9 phrase "what the market would bear."
10 I think that typically that phrase with
11 respect to hourly rates and lawyers would reference
12 whether a lawyer in downtown Fort Lauderdale for
13 instance could get $600 an hour compared to $450 an
15 I don't think that's what you were alluding
17 A. That's not what I was alluding to.
18 Q. So let's just clean up the record a bit.
19 When you say what the market would bear,
20 what exactly do you know that you told Stu in terms
21 of your words and what he understood by them and how
22 you know that.
23 A. I told Stuart that I was billing them based
24 upon an arrangement that I reached with Albert with
25 regard to making sure that we had plenty of money
1 in-house to operate, and that we were going to be
2 repaying some of the money to Albert through various
4 Q. Now, you mentioned Jewel River Cruises a
5 moment ago.
6 When was the first time there was this
7 genesis of a thought of creating Jewel River Cruises?
8 A. Hang on. I want to make sure that my
9 conversations with Stu are clear.
10 I want you to know that in talking to
11 Stuart that the way I just said that to you is not
12 the way that I would say something to Stuart.
13 Q. Yes. I understand.
14 What I was asking for was the plain English
16 A. When it came to Silversea I came right out
17 and told Stuart that we were billing them based upon
18 what Albert was telling us we could bill.
19 I'm certain there were many expletives, but
20 said in a fun-loving fashion, as I would when I was
21 being, I guess, what people called colorful.
22 Something like: We're making an F-ing
23 fortune off this. We've got to give Albert back some
24 of this money, but we're still making a fortune off
25 it. We're making far more than the amount of time
1 we're spending.
2 I remember him asking me about the wire to
3 Tatiana, and I told him it's money we owe Albert from
4 all that money we took from Silversea. We've got to
5 give some of it back to him. He's entitled to it.
6 He had no problem with it.
7 Stuart asked me about the car. As a matter
8 of fact, before I bought that car for Coniglio I went
9 and told Stuart that I was doing it, and told him the
10 circumstances, so he knew what was going on in that
12 Q. So the record is clear, that last statement
13 that you made is more along the lines of what you
14 actually told Stuart as opposed to the previous
15 answer which was telling me in plain English what was
16 going on. Right?
17 A. Yes.
18 Q. Now, let's go to Jewel River Cruises for a
19 moment. Maybe for awhile.
20 When was the first time that you and Albert
21 talked about the concept of Jewel River Cruises?
22 A. It was some time to the best of my
23 recollection during maybe 2006. Albert had had this
24 idea and then it blossomed from there.
25 Q. So while he was still at Silversea he came
1 up with the idea for Jewel River Cruises?
2 A. I don't know when he came up with the idea.
3 He gave -- told me about the idea at a point in time
4 when he was thinking that he might be having to leave
6 Q. So, to be sure, during the time period that
7 you were negotiating for Albert with Silversea there
8 had already been some discussion about forming Jewel
9 River Cruises. Right?
10 A. Yes.
11 Q. What was your understanding -- and I want
12 to focus on this mid January timeframe -- January,
13 2007 -- what was your understanding of what Jewel
14 River Cruises was going to turn into, hopefully?
15 A. A river cruise version of Silversea.
16 Q. How was that going to come to life?
17 A. Through Albert's expertise in the cruise
18 industry, the significant knowledge he gained running
19 Silversea, the connections he had made, his use of
20 his international business and finance contacts and
21 funds that we were going to invest -- "we" meaning me
22 and Stuart -- from RRA to Jewel River Cruises.
23 Q. What was your role going to be in Jewel
24 River Cruises?
25 A. I don't remember what my title was going to
1 be or what it was.
2 Q. I was thinking more like role as opposed to
4 A. Shareholder.
5 Q. Controlling?
6 A. I don't recall whether it was controlling
7 or not. I'm certain there would have been a very
8 strong level of control, but I don't remember how the
9 shares were going to be split up. Could have been
10 controlling. I just don't have a specific
12 Q. Is it a fair statement that at the time
13 that you were negotiating Albert's departure from
14 Silversea you did not disclose to Silversea nor did
15 Albert that the two of you had already hatched a plan
16 to potentially launch Jewel River Cruises?
17 A. No. The only people that knew about Jewel
18 River Cruises at that point in time were me, Albert,
19 Stuart, Steve Lippman, Blandin Wright and likely
20 Debra and Irene.
21 Q. Blandin was also with you in London.
23 A. You know, I suppose that's possible, but
24 I've got to tell you I don't have a specific
25 recollection of him -- oh. Wait. Yes. Yes. Yes.
1 He was definitely there and I'll tell you how I
2 remember -- because when we were flying over there we
3 flew in -- I believe we flew in first class and ---
4 Q. Did you ever fly coach class?
5 A. Not from 2006 on I didn't.
6 Q. I didn't think so.
7 A. So I had Lippman sitting here, I'm sitting
8 here (indicating), and to my left in those seats that
9 lay down -- those cubicle things -- I was over here.
10 I don't remember where our wives were, but
11 I remember Blandin was a couple of seats away from
12 us. Steve was reading Sports Illustrated. I was
13 reading a watch magazine and we looked over and
14 Blandin was reading the income tax code.
15 Q. Do you recall Blandin telling you in London
16 that or discussing with you in London the fact that
17 he thought it was unique or odd or wrong that you
18 were negotiating for Albert while you were
19 Silversea's counsel?
20 Any conversation along those lines at all?
21 A. Not to my recollection.
22 Q. Regardless, in January Blandin already
23 knew as well that Jewel River Cruises was about to
24 potentially become a reality, if I understand your
25 testimony then. Right?
1 A. Sure. I found out from reading Blandin's
2 e-mails -- and this was while RRA was still in
3 business -- I was scanning his e-mail and he had
4 written e-mails to Albert advising Albert about
5 confidential firm conversations I had with staff and
6 the like about financing and moneys allegedly coming
7 into the firm and basically telling Albert how to
8 pounce on me and how to get certain moneys.
9 Q. I remember.
10 A. Yes. He was well aware.
11 Q. And you were really angry with him about
12 that, as I recall -- with Blandin.
13 A. Yes.
14 Q. Did Blandin participate in the negotiations
15 to the best of your recollection concerning Albert's
17 A. I don't recall one way or the other.
18 Q. Do you recall Blandin ever advising
19 Silversea that you and Albert were forming Jewel
20 River Cruises?
21 A. I don't recall one way or the other.
22 Q. Is it a fair statement that you never told
23 Silversea that you and Albert were forming Jewel
24 River Cruises?
25 A. That's a fair statement.
1 Q. You agree that you had disclosed to them
2 that you and Albert were forming Jewel River Cruises
3 they probably would have terminated you as counsel on
4 the spot?
5 A. Yes.
6 Q. At the point in time that Albert left the
7 company, Manfredi and Amerigo had totally had it with
8 Albert. They wanted him gone in a big way.
9 Would you agree with that?
10 A. Yes, sir.
11 Q. So had they known that you had had the
12 relationship that you indeed did have with Albert,
13 they would have taken a very dim view of you?
14 A. That's correct.
15 Q. I'm going to stay with Jewel River Cruises.
16 Did you ever reach any preliminary
17 agreement back in 2006 or very early 2007 as to how
18 much money you were going to invest in Jewel River
20 A. I don't recall capping it. I may have, but
21 I don't have a specific recollection one way or the
22 other. It was millions of dollars.
23 Q. Millions that you ultimately put in.
25 A. Yes.
1 Q. Did you assist in preparing any business
2 plans for Jewel River Cruises?
3 A. I may have reviewed them at one point in
4 time, but I don't remember actually sitting down to
5 prepare it, no. That would have been something David
6 Boden and Blandin would have been involved in.
7 Q. Blandin certainly was responsible for that
8 at the beginning of the Jewel River Cruises days.
9 Do you agree with that?
10 A. Yes, sir.
11 Q. And then David Boden later took a more
12 active role in overseeing the Jewel River Cruises
14 A. Yes. I promised him a piece of the company
15 and he became much more involved.
16 Q. What was David responsible for doing?
17 A. More of the day to day interaction with
18 Albert, watching over the finances, corporate
20 Q. Did he oversee the transmittal of funds
21 from RRA to Jewel River Cruises on any of ---
22 A. He assisted, yes.
23 Q. Do you agree that all money that went to
24 either loans or your equity interest in Jewel River
25 Cruises was RRA funds?
1 A. It was Ponzi funds that went into RRA that
2 became RRA funds that were then paid out.
3 Q. It was not money that you had earned in any
4 legitimate basis that was kept in any accounts titled
5 in your name. Correct?
6 A. Correct.
7 Q. At the time that Mr. Boden oversaw the
8 transfer of money out of RRA accounts he knew that
9 the money was coming from RRA accounts to Jewel
10 River Cruises. Right?
11 A. That's correct.
12 Q. Whose name was the investment put in for
13 Jewel River Cruises?
14 A. I don't recall. It would have either been
15 mine directly -- mine and Stu's -- or a company -- a
16 separate company that we set up.
17 I don't have a specific recollection one
18 way or the other.
19 Q. Certainly the investment -- loans, equity,
20 however you want to phrase it -- because I think
21 there are different variations of that -- none of
22 those obligations or rights were vested in the name
23 of RRA. Correct?
24 A. No. They were not. That's correct.
25 Q. And Boden knew that at the time that he
1 helped effect that financial transaction. Correct?
2 A. That's correct.
3 Q. Did you ever discuss with him the fact that
4 it was RRA money that was then being converted to
5 your use in terms of either an equity interest or
6 owner of a note?
7 A. He never questioned it because that's the
8 way we paid for everything.
9 Q. When you say "that's the way we paid for
10 everything," can you expound on that, please?
11 A. Yeah. Boden I told you was not only
12 general counsel to the firm, he was my consiglieri.
13 He handled virtually from the time he joined us every
14 -- the financial end of every business that I became
15 involved in, whether it be with Shimone Levy, Casa
16 Casuarina, V. Georgio, RRA Goal Line ---
17 Q. That's the sports management entity?
18 A. Yes.
19 Q. Kip Hunger Marketing, Africat Yachts, Bova
20 restaurant group, all of those.
21 Boden was the main architect of the
22 financial side and the corporate structure side of
23 every single one of those deals, and he knew that all
24 of that money was coming one way or the other from
25 RRA accounts.
1 And, similarly, he knew that each time that
2 he caused a disbursement from an RRA account that
3 title in the shares of either the respective LLC or
4 corporation was being placed in the name of either
5 you or a single member LLC that was formed for your
7 Do you agree with that?
8 A. Yes.
9 Q. And in some instances he was getting an
10 equity interest in some of those investments, as
13 A. That's correct.
14 Q. Like an interest in a bank that you were
15 purchasing. Correct? I think it was Greater
17 A. That's correct. I thought it was Broward
18 Bank of Commerce.
19 Q. Broward Bank of Commerce.
20 Yes. Thank you -- and others as well.
22 A. You're welcome.
23 Q. And other entities, as well?
24 A. I had every intention of giving David Boden
25 an interest in every one of the companies that he was
1 assisting me with.
2 Q. Why?
3 A. Because he was an excellent consiglieri and
4 he was running a fantastic sub-Ponzi scheme that was
5 assisting me in funding all this.
6 Q. And money from the sub-Ponzi scheme -- did
7 any of that make its way into RRA accounts?
8 A. All of it.
9 Q. All of it ---
10 A. My cut -- all of it.
11 Q. All of your cut.
12 A. Actually, all of it, because even the cuts
13 that I paid back to Pearson and Boden through those
14 fake finders' fee thing they created, that still ran
15 through RRA accounts and then went to them.
16 (Short Break)
17 Q. Just a moment ago we were talking about
18 your deals with Boden. I want to make sure I
19 understand the flow of money because I don't want
20 there to be any lack of clarity as to how the money
22 The first is that Ponzi money -- that is
23 money from we'll just call them the deals, no matter
24 how they were structured -- that money went into RRA
25 accounts. Correct?
1 A. Yes, sir.
2 Q. The accounts were hopelessly co-mingled in
3 the sense that whenever you needed money from
4 whatever account had it in there you took the money
5 for whatever purpose. Correct?
6 A. That's correct.
7 Q. That money could have been used to pay
8 your expenses, could have been used to pay some RRA
9 expenses, could have been used to pay for toys.
11 A. Yes, sir. All those things and more.
12 Q. And sometimes even for investments. Right?
13 A. Correct.
14 Q. I noted that yesterday you answered the
15 question in the negative as to the fact that you did
16 not view there to be an alterego between you and RRA.
18 A. That's correct.
19 Q. At the time that Albert was terminated from
20 Silversea I have e-mails that show that you went to
21 Silversea to open his safe.
22 Do you recall that?
23 A. I do.
24 Q. Why did you do it as opposed to the company
25 doing it?
1 A. I needed to get the items that were in
2 there before the company did.
3 Q. What items did you need to get to?
4 A. There were computer disks in there that
5 Albert needed. There was some personal documents and
6 some personal photos in there that Albert needed.
7 Q. What was the content on the computer disks?
8 A. To the best of my recollection it was
9 downloads of some of the embezzlement documents that
10 Albert and I had that were on their server that we
11 took off their server.
12 Q. How did you remove them from the server?
13 A. I don't recall. We had -- I don't know the
14 mechanics of it.
15 I had either Bill Corte or Curtis -- I
16 think it was Curtis -- go over there and effectuate
17 that and give the disks to Albert who then locked
18 them in a safe.
19 Q. I found a check, which I don't have with
20 me, just kind of came to my memory, payable to Rey
21 Leon for services rendered, and I recall the legend
22 being that it pertained to Silversea.
23 Did Rey perform any ---
24 A. Yes.
25 Q. What services did Rey perform for Silversea
1 that you recall?
2 A. I may have sent him over there either with
3 Curtis or separately from Curtis to assist in getting
4 the -- either -- it wasn't on the downloading data
5 issue. It was on the making sure that by the time
6 Albert left that any incriminating e-mails had been
8 Q. Did he know that that was the mission,
9 meaning did Rey know that that was what his mission
10 was and what he was looking for?
11 A. He knew that we needed to eliminate disks
12 -- excuse me -- eliminate information -- but I did
13 not explain it to him in the fashion of a crime. I
14 explained to him that Albert as CEO wanted the data
16 Q. So he had no knowledge of the contents of
17 that which he was removing?
18 A. He didn't know that it was harmful to me
19 or to Albert. He just knew that the CEO of this
20 cruise line wanted it removed.
21 That's to the best of my recollection.
22 Q. In the course of my serving a subpoena
23 upon Silversea Cruises for documents pertaining to
24 Albert and RRA I had been told that they had
25 determined that a fair amount of data had been
1 deleted from their computers but they weren't able to
2 restore it.
3 Is that the information that you think
4 you're alluding to now?
5 A. Yes. There were several occasions, one
6 where Rey was over there I believe with Curtis or
7 Bill, and another where either Curtis or Curtis and
8 Bill were there, maybe a third time, when we were
9 making sure that data was taken off of the Silversea
10 server such that anything incriminating would never
11 be able to be found.
12 Q. Now, going back to the reason for Albert's
13 termination from Silversea, you said it was expenses
14 that were charged improperly to the company.
15 To the best of your knowledge, did that
16 include, for instance, maid service at his house?
17 A. Yes.
18 Q. Limos for Diane DelValle?
19 A. Yes.
20 Q. Renting very high end cars when he was out
21 on business?
22 A. Yes, sir.
23 Q. Taking Tatiana Yoel with him and charging
24 that to the company on business travel?
25 A. Yes, sir.
1 Q. With respect to Jewel River Cruises, our
2 records reflect that you put millions of dollars into
3 the company.
4 Is that your recollection?
5 A. That's correct.
6 Q. Our records also reflect, at least they
7 seem to suggest, that the money went directly from
8 RRA accounts to a number of different Jewel River
9 Cruises accounts.
10 Are you familiar with that?
11 A. I am.
12 Q. There was an account in Florida for the
13 Florida operation and there was an account in
14 Switzerland for the Swiss operation.
16 A. Yes, sir.
17 Q. We seem to gather that there were a fair
18 amount of employees that Jewel River Cruises had
19 employed both here and in Europe.
20 Do you agree with that?
21 A. I don't recall off the top of my head how
22 many employees we had.
23 Q. Ten? Approximately ten?
24 A. Sounds about right.
25 Q. Was the source of providing the capital
1 needed for all of this general overhead including the
2 salaries solely money that to the best of your
3 knowledge was coming from RRA?
4 A. Yes.
5 Q. RRA received no benefit for any of this
6 money that was going out the door.
7 Do you agree with that?
8 A. Yes.
9 Q. Do you know whether or not Albert Peter was
10 supposed to be paid money from Jewel River Cruises?
11 A. Whether Albert Peter was supposed to be
13 Q. Yes. Was he receiving a salary from Jewel
14 River Cruises?
15 A. My understanding was he was supposed to be
16 receiving only a minimal amount from Jewel River
17 Cruises because it was a start-up entity. He was
18 supposed to be receiving something.
19 Q. You were supplementing his income with the
20 biweekly checks. Correct?
21 A. That's correct.
22 Q. That was separate and apart from the
23 nominal funds that he was getting from Jewel River
24 Cruises. Correct?
25 A. Assuming they were, in fact, nominal.
1 Q. Did you to the best of your knowledge ever
2 learn whether or not Jewel River Cruises actually
3 acquired any ships?
4 A. I was told that we did, but it later became
5 my understanding that we may never have actually
6 acquired anything.
7 Q. Where did you learn that from?
8 A. David Boden.
9 Q. To the best of your knowledge, was all the
10 money that you sent from RRA to Jewel River Cruises
11 accounted for?
12 A. You mean accounted for on my side or their
14 Q. Their side to you.
15 A. No. They did not account for it.
16 As a matter of fact, there was a
17 significant period of time where we were attempting
18 to get reconciliations and find out where the heck
19 all that money had gone and we were being thwarted by
20 Mr. Peter.
21 Q. When you say you were "thwarted" by him,
22 what is it that you mean?
23 A. He was giving us stories about where the
24 money was and why we couldn't get access to the
25 on line banking.
1 Q. How long of a period of time did this go on
3 A. To my recollection, months.
4 Q. Did you ever come to a conclusion as to
5 what happened with the money --
6 A. Yes.
7 Q. -- the missing money.
8 What conclusion did you reach?
9 A. I agreed with what Mr. Boden told me, that
10 we believed that Albert had stolen the money along
11 with some other co-conspirators that he said.
12 Q. How much money do you believe that they
14 A. Most of what we had invested.
15 Q. And upon what facts did you base that
17 A. That they couldn't produce any documents
18 to us showing us where any of the money went
19 legitimately other than the payroll that they were
20 paying. They could not produce any documents to us
21 showing anything that we actually owned.
22 Q. Such as a ship. Correct?
23 A. A ship, a document showing a ship.
25 Q. Did you confront Albert about this?
1 A. They were not able to show us anything.
2 Q. Did you confront Albert about this?
3 A. Yes.
4 Q. What did you say to him?
5 A. I tried to handle it delicately.
6 Q. Why delicately?
7 You're not necessarily someone that always
8 handled things so delicately. You were pretty direct
10 A. I was direct, but I wasn't going to
11 accuse him of stealing at that point in time because
12 -- listen, Albert and me and Boden and the people
13 that were involved -- we again all fell within the
14 doctrine of mutually assured destruction, because I
15 couldn't do anything to Albert because I had already
16 engaged in a major embezzlement scheme with him from
18 So it's not like I could have reported him
19 to the authorities, so there was no reason to go any
20 further than I had to.
21 Q. So when you say that you addressed it with
22 him delicately, what did you say?
23 A. I sent him e-mails and talked to him in
24 person about the fact that he was making me look like
25 an idiot with the people that I was getting the money
1 from. I think I referenced the hedge funds in a
2 bunch of the e-mails, that I couldn't account for
3 moneys with my bankers.
4 I tried to apply pressure to him in that
5 fashion, and, Mr. Lichtman, I remembered something
6 about the erasure of the e-mails that you may need to
8 Q. Yeah.
9 A. There were at different points in time
10 four people that went over either all together at
11 certain points in time or in groups or separately
12 that assisted in the erasure of the data from the
13 Silversea's computer.
14 It was Bill Corte, Curtis Renie, Rey Leon,
15 and another one of my attorneys who had significant
16 computer experience, Michael Pancier.
17 And the reason I remember that Michael went
18 over is because there was a point in time when I
19 needed something specifically erased that Albert had
20 called me about with regard to e-mails back and forth
21 between him and Diane DelValle that he wanted off the
22 computer, and I had no one else to send there, and I
23 remember asking Michael if he could go over and help
24 them, but I also want to make clear that even though
25 Curtis Renie and Bill Corte were involved in other
1 parts of this crime, that neither Mr. Corte,
2 Mr. Renie, Rey Leon or Michael Pancier were ever told
3 of the illegal portion of that.
4 They all four believed, to the best of my
5 knowledge, that they were going over there and acting
6 on the authority of the CEO of Silversea to do
7 something that Silversea legitimately wanted to do.
8 Q. So documents that were destroyed off of the
9 Silversea server -- would there have been
10 corresponding copies of those documents on RRA
12 A. No. I don't believe we ever downloaded
13 them onto our servers.
14 Q. So the sole set would be that which was in
15 the possession of Albert Peter?
16 A. Yes.
17 Q. What did you do with the disks that you
18 took from the safe?
19 A. We returned them to Albert.
20 Q. Do you know what he did with them?
21 A. I have no idea.
22 Q. You said a few minutes ago going back to
23 the issue of once you discovered that Albert was
24 stealing from you on the Jewel River Cruises
25 transaction that you were sending him e-mails and
1 talking to him about the embarrassing issues with the
2 money you were trying to get from the hedge funds.
3 Is it correct that you never received any
4 money from the hedge funds with respect to investing
5 in Jewel River Cruises?
6 A. That's correct.
7 Q. So the story that you told him was untrue,
8 but it was intended to put pressure on him?
9 A. Correct.
10 Q. Same thing with respect to the banks and
11 your accountant?
12 A. That's correct.
13 Q. Did you ever have a direct conversation
14 with him where you said, "I know you ripped me off,"
15 or words to that effect?
16 A. There was a conversation at my home at
17 2308 Castilla where there was a gentleman named
18 Eberhardt in town -- I believe it was Eberhardt --
19 Albert, myself and Mr. Boden.
20 We were sitting out in my backyard off to
21 the right under this little covered area smoking
22 cigars and having cocktails and I colorfully
23 explained to Albert and Eberhardt that I had a pretty
24 good idea that I had been scammed and that if things
25 were not as they were between Albert and I, that they
1 would be dealing with people of Mr. Coniglio's ilk to
2 resolve the issue, but that I was giving them a pass.
3 Q. Why did you give him the pass?
4 A. Doctrine of mutually assured destruction.
5 Nothing to gain by it.
6 Q. How much do you understand they had stolen
7 from you in connection with the Jewel River Cruises
8 -- we'll call it deals, transactions, attempts to
9 start a business?
10 A. Between five and seven million dollars.
11 They were stealing stolen money.
12 Q. That's certainly one reason you couldn't go
13 to the authorities.
14 A. Yes. I had to go to a different kind of
15 authority if I was going to do anything, and that was
16 not my way of doing business.
17 Q. I have an e-mail from Blandin to you
18 that -- this is July 15, 2008 -- it's Trustee
19 document 296 -- that discusses Blandin telling you
20 that he has a P&L that says from inception through
21 June 30, 2008 there was a net loss of a million
23 How did you get to the five million dollar
25 A. I added up all the money I sent to Jewel
2 Q. Did they have any legitimate operations
3 that they were trying to conduct?
4 A. As I sit here today, I believe that in the
5 beginning they were trying to get this to go, but
6 that soon thereafter they decided just to steal
7 whatever they could get out of me.
8 Q. And when you say "they," who is "they"?
9 A. Albert, Eberhardt and his co-conspirators,
10 whoever else was involved.
11 Q. The guys in Switzerland?
12 A. Yes.
13 Q. Is there a Mr. Baur, B-A-U-R?
14 A. Yes, but I didn't believe I ever met him.
15 Q. Mr. Henter, H-E-N-T-E-R?
16 A. Again, yes. I recognize the name, but I
17 don't believe I ever met him.
18 Q. Did you ever see actual evidence ever of
19 there being confirmation of two new built ships for
20 the benefit of Jewel River Cruises?
21 A. To the best of my recollection, David Boden
22 told me that he had seen documents but basically
23 described them to me as cockamamy and not really
24 proof of anything.
25 Q. Did you ever see evidence, the proof, of
1 Albert Peter making an investment of his own cash
2 into Jewel River Cruises?
3 A. I have no specific recollection of ever
4 seeing that one way or the other. I remember him
5 telling me he did, but I don't remember seeing proof.
6 Q. Did you ever see proof of Albert Peter
7 executing guarantees that were called upon in
8 connection with funding or financing for Jewel River
10 A. I don't have a specific recollection of
11 that one way or the other.
12 Q. Meaning you don't recall the transaction
13 or you don't recall seeing the documents?
14 A. I recall him telling me he was guarantying
15 things, but I don't recall seeing the documents
16 evidencing the real guarantees.
17 Q. We're almost done.
18 Sheyene Rogers, S-H-E-Y-E-N-E Rogers.
19 Do you know who she is?
20 A. I do.
21 Q. Who is she?
22 A. A woman who worked for our firm in various
23 capacities over the years.
24 Q. Did she have any involvement in Jewel River
1 A. I don't have a recollection one way or the
2 other. She may have assisted Albert from time to
3 time, maybe serving as a secretary or a receptionist
4 or assistant, but I don't have a specific
5 recollection of that, Mr. Lichtman.
6 Q. There was a point in time where Jewel River
7 Cruises occupied space within the RRA premises.
8 Do you recall that?
9 A. I do.
10 Q. Was that at the beginning of when Jewel
11 River Cruises was being formed?
12 A. I think it was pretty much early on. I
13 don't remember specifically a timeframe, whether it
14 was the beginning or the middle, but it was fairly
15 early on when Albert was telling me he needed an
16 office, and we were taking space on the 22nd floor
17 and we gave him a bunch of it.
18 Q. There came a point in time where Jewel
19 River Cruises closed completely, shut down.
20 Do you recall that?
21 A. I do.
22 Q. Do you know what happened to all of its
23 books and records?
24 A. They disappeared.
25 Q. They disappeared meaning what? Who took
1 them? Who caused them to disappear?
2 A. To the best of my knowledge, Albert Peter.
3 Q. Did you see him remove them from the
5 A. I did not.
6 Q. To the best of your knowledge, who was the
7 last custodian of the Jewel River Cruises documents?
8 A. Albert Peter.
9 Q. The last area I'm going to get into today
10 is if you would go back to the complaint and look
11 at ---
12 A. One moment, please.
13 MS. GUARIGLIA: What's the Bates number?
14 MR. LICHTMAN: 048.
15 A. Spreadsheet?
16 Q. Spreadsheet.
17 Got it?
18 A. Got it.
19 Q. For the record, this is a spreadsheet our
20 forensic accountants have put together reconstructing
21 the records of RRA.
22 These deal with transactions that you
23 engaged in with Albert Peter starting in or about
24 March 2, 2007 through 2008 -- different parts of time
25 in 2008.
1 There's 12 of these transactions even
2 though it's labeled up to loan 11, and that's because
3 there was loan 1A and 1B.
4 Do you recall engaging in a series of
5 transactions with Albert Peter that related to the
7 A. Yes.
8 Q. Describe to me what your recollection was
9 as to what kind of deals you did with Albert.
10 A. They were just like the same kind of deals
11 I was doing with everybody else, just in a minimal
12 paper level. Same type of thing I was doing with
13 Morse, Lipshitz ---
14 Q. Bridge loans?
15 A. Yep.
16 Q. You'll see in the right margin where it
17 says: EST annualized return --
18 A. Hold on. Yes.
19 Q. -- Albert Peter received interest rates
20 on an annualized basis -- I'll read them into the
21 record: 136.55 percent, 38.32 percent,
22 44.62 percent, 73.04 percent, 529.09 percent,
23 243.35 percent, 1,951.45 percent, 108.51 percent,
24 1,216.21 percent, 176.44 percent, and 329.01 percent.
25 All these loans, loan transactions, came
1 about in a point in time starting shortly after
2 Albert was terminated from Silversea.
3 Why did you engage in all of these high
4 interest transactions with Albert?
5 A. I needed the money for the Ponzi and he
6 needed the money to survive.
7 Q. To what extent were the transactions that
8 you engaged in with Albert related to repayment of
9 the opportunity he helped create by the embezzlement
10 from Silversea?
11 A. Can you ask that question again,
12 Mr. Lichtman?
13 Q. To what extent is there a relationship
14 between your entering into these high interest rate
15 transactions with Albert Peter tied to the
16 opportunity he provided in the material embezzlement
17 engaged in with Silversea?
18 A. It was, for lack of a better term, a quid
19 pro quo.
20 Q. Did you discuss with him the high interest
22 A. We discussed it from time to time, yes.
23 Q. Did you explain to him how you could be in
24 a position of paying some deals that were not only
25 well over 100 percent, but some that were more than a
1 thousand percent?
2 A. As I told you earlier, when Albert and I
3 discussed this he knew there was a fraud going on.
4 He didn't care.
5 So the conversation only came up in how
6 wonderful it was and for clarification purposes when
7 I said I needed the money and he needed the money to
8 survive, that should have been defined as survive in
9 the lifestyle to which he had become accustomed.
10 Q. You recognize that Albert was what we call
11 a net winner?
12 A. Yes.
13 Q. Our records show that Albert put in
14 $2,259,845 and he got back $3,643,194.
15 Therefore, his net gain was almost 1.4
17 Were you aware of that?
18 A. I knew that he had made over a million
19 dollars. I did not recall the exact amount.
20 Q. Take a look at page 55, if you will.
21 A. One second, please.
22 Q. Sure.
23 (Discussion off the record.)
24 Q. Do you recall the circumstances behind this
25 transaction, the one that's referenced in that e-mail
1 for $500,000.
2 A. I don't recall this specifically, no. Just
3 another one of our deals.
4 Q. This is reflected on the spreadsheet, which
5 is Exhibit 48 as loan 1A.
6 I believe that what you did was roll it
7 into what became loan 1B.
8 Do you have any recollection of that?
9 A. I did that from time for time with him and
10 with others, yes.
11 Q. Why did you do that?
12 A. Didn't have the money to pay him at the
14 Q. Did he question the fact that you didn't
15 have the money?
16 A. No.
17 Q. Jump to page 59.
18 I guess this e-mail is out of place. This
19 addresses Manfredi.
20 Do you recall this e-mail?
21 A. Yes.
22 Q. Describe it for me.
23 A. Albert and Rita were already in my space
24 working on the Jewel deal and we did not want
25 Silversea to know that they were working with me.
1 I believe that Manfredi was going to be
2 coming by our offices and I did not want Albert or
3 Rita to be wandering around the 16th floor where my
4 office was when Manfredi came in.
5 Q. Now turn to page 60. Get back on track
6 with the deals.
7 A. Okay.
8 Q. I assume you did a lot of deals so you
9 don't necessarily recall this particular one --
10 loan 2?
11 A. Nope. I do not.
12 Q. This was consistent with how you often
13 wrote some of the bridge loan deals, though. Right?
14 A. It is.
15 Q. Did he conduct any due diligence on the
16 transaction -- "he" being Albert?
17 A. He did not.
18 Q. Did you ultimately give him a promissory
20 A. I may have. I don't have a specific
21 recollection one way or the other.
22 Q. Was there any substantive discussion about
23 the transaction other than that which is stated in
24 the e-mail providing what the repayment schedule was
25 going to be in paragraphs 1 through 6 of the e-mail?
1 A. I don't have a recollection one way or the
2 other what I discussed with him.
3 MR. LICHTMAN: For the record, we're going
4 to mark the complaint as Composite Exhibit 5 I think
5 it is.
6 (Whereupon, the document referred to was
7 marked Plaintiff's Composite Exhibit No. 5 for
9 Q. Take a look at page 63.
10 A. 63. Got it.
11 Q. This is from Albert to you -- March 30,
12 2007 -- so he's already gone by then.
13 A. Yep.
14 Q. What does the first sentence refer to:
15 Bank confirmed the wire left 95,000. Check over
16 U.S. 70,000 is in your hands.
17 Do you know?
18 A. No.
19 Q. The third sentence down: Can we speak some
20 more on Rita? I don't want to chase a dead horse.
21 If you feel we should not touch her let me know so I
22 can find a suitable replacement. On the other hand,
23 I'm kind of worried to just leave her at Silversea.
24 Do you know what that means?
25 A. Yes.
1 Q. What?
2 A. When Albert initially left Silversea we
3 left Rita there working there with the idea that
4 eventually she'd join us at Jewel River. We were
5 talking about how long to leave her there because
6 she was feeding us information as to what was going
7 on there subsequent to Albert's departure and
8 eventually we brought her over.
9 Q. What was the sensitivity?
10 A. Well, we wanted to know -- it was important
11 for us, at least for the first bunch of months
12 following Albert's departure, to have a mole inside
13 Silversea feeding us information, but at the same
14 time we did not want her to feel abandoned there and
15 potentially have her turn on us.
16 She did not like working there without
17 Albert there, so that's the way it worked.
18 Q. Did you ever get money or any other
19 inducement of any nature over to Rita it keep her
21 A. I may have sent her money from time to
22 time. I don't have a specific recollection one way
23 or the other.
24 Q. Let me just go over my notes. I think
25 I've got it all.
1 I have one thing. We found the Doug Bates
3 It's marked as Trustee 278, and it deals
4 with the situation where Amerigo writes you an
5 e-mail and he says: "How does this guy at the
6 courthouse know that you are our counsel," and you
7 wrote back, "Anyone can run the Silversea name at the
8 courthouse on a link and pull up any action and see
9 their most recent counsel."
10 At the bottom you talk about there being
11 another blackmailer around -- excuse me -- Amerigo
12 says there's a concern there's another blackmailer
13 around, and you wrote: "Doug Bates has an excellent
14 reputation in the community. My guess is that he has
15 some significant evidence. He has never had the
16 reputation of being someone to engage in that kind of
17 nonsense. He is quite successful and has no need to
18 engage in such behavior."
19 And then you go on and talk about a plan.
20 Do you recall the circumstance with Doug
21 Bates and this e-mail?
22 A. Do you have the Doug Bates letter attached
23 to that e-mail?
24 Q. No.
25 A. Does it reference Doug Bates' letter?
1 Q. It references it, yes.
2 A. What does it say?
3 Q. Your response is that Doug has an excellent
4 reputation in the community.
5 A. I know, but does Amerigo say he's ---
6 Q. Amerigo says: "Just received this letter
7 from attorney Doug Bates. "Please review and
8 advise" --
9 A. Okay.
10 Q. -- "as to whether his allegations have
11 merit. I've litigated against this attorney many
12 times and he does not make empty threats."
13 This is actually your letter.
14 "However, as a result of my professional
15 relationship with him I am certain that I can buy us
16 any time we need to conduct our own investigation,"
17 et cetera.
18 Do you recall the circumstances of this
19 e-mail exchange in May, 2007?
20 A. I do.
21 Q. First, to be sure, it is not the Doug Bates
22 that has been employed as a partner at Berger
23 Singerman. Correct?
24 A. No.
25 Q. It's Doug Bates that is, I believe, either
1 a Fort Lauderdale or a Plantation lawyer. Right?
2 A. Plantation, I believe.
3 Q. Describe for me that which you recall about
4 this e-mail.
5 A. It was more of the scam that Albert and I
6 were pulling on Manfredi.
7 Q. How's that?
8 A. We were going to use it to embezzle ---
9 Q. Albert was gone by then.
10 A. I understand that, but I was going to use
11 it to, one, have Manfredi stay out of the country --
12 actually, I don't remember if it was stay out of the
13 country, but I was either using it to keep Manfredi
14 out of the country or utilizing it to keep Silversea
15 keeping me retained.
16 I have to see the letter to tell you which
17 one it was.
18 Q. Did you have a deal with Bates to have him
19 draft a fake letter on your behalf?
20 A. I did.
21 Q. What was the deal?
22 A. He would draft the letter and I would pay
24 Q. What did you pay him?
25 A. I don't recall how much I paid him. As a
1 matter of fact, I may have had Albert pay him.
2 Q. Cash?
3 A. No. If Albert paid him, it would have been
4 cash. If I would have paid him, it would be a check.
5 Q. Is there anything else you can recall about
6 the circumstances of this e-mail exchange?
7 A. Mr. Lichtman, if I saw the letter I could
8 tell you for certain. I just can't recall whether or
9 not it was having Doug Bates write about something
10 that was for the purpose of controlling Manfredi or
11 for the purpose of keeping Silversea locked into me
12 and thereby again controlling Manfredi, but it was
13 without a doubt an illegal letter written for an
14 illegal purpose by Doug Bates as crafted -- meaning
15 as put together, developed, by myself and Albert.
16 Q. Did it lead to further legal work for RRA?
17 A. Without seeing the letter, I can't tell
19 Q. Unfortunately, the way that they print it
20 out of the production of documents to us it didn't
21 have the attachment.
22 However, I did find what I believe to be
23 one of the bond deals, although it's somewhat vague.
24 I have an e-mail from June 4, 2008. It's
25 Bates stamped Trustee 289 and at the bottom it's a
1 note from you to Manfredi and Amerigo saying that you
2 were in court today and you were telling the Court
3 what you were going to do with the funds and that you
4 would advise them back and you were supposed to send
5 the funds the same day as the hearing and that this
6 was to come up with funds on an emergency basis to
7 obtain an emergency hearing, and that you wanted to
8 make sure you got this done because you "do not want
9 to piss this judge off," and then you had $750,000
10 that were directed to be transferred to you by
11 Silversea Cruises on that same date.
12 Does that refresh your memory about one of
13 the bond deals?
14 A. It was one of those deals. I don't recall
15 the underlying circumstances, but that's what that
17 MR. LICHTMAN: I don't have anything
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