FORT LAUDERDALE, Fla. - Rothstein Rosenfeldt Adler law firm's chief financial officer was charged Wednesday for her involvement in a $1.2 billion Ponzi scheme that put her former boss in prison for five decades.
Irene Shannon, whose maiden last name is Stay, was involved in Scott Rothstein's investment scheme from 2005 to 2009, federal prosecutors said. They charged her with a lone count of conspiracy to commit money laundering and bank fraud, and filed a court document that indicates she is likely to enter a plea deal.
IRS agent José A. Gonzalez said in a statement that evidence showed Shannon helped "to deceive investors by creating a facade of wealth."
Earlier in the case, federal agents seized e-mails that showed Shannon, 50, kept track of the law firm's account balances and followed orders from Rothstein to cut checks and "move money" around.
Rothstein "was the mastermind of a massive Ponzi scheme, but he needed a trusted agent who knew how to shuffle money to keep the scheme running," said FBI agent George Piro in a statement.
Rothstein trusted Shannon with 38 bank accounts from Gibraltar Private Bank & Trust in Fort Lauderdale, Colonial Bank, Sterling Bank and TD Bank in Weston.
From 2006 to 2008, Shannon is accused of engaging in "check kiting" fraud with Equitable and Colonial bank accounts. The checks totaled about $10 million, prosecutors said.
"I actually instructed her to move whatever money she needed to move from account to account to make this payment via wire," Rothstein said in a deposition.
Shannon is named in many other lawsuits related to the firm as authorizing credit card payments in behalf of the Fort Lauderdale firm, which employed about 70 attorneys and 150 staffers.
During her confession, former law firm's chief operating officer Debra Villegas said Shannon played the most important role in the scheme. Villegas, who cooperated with authorities, plead guilty and is facing a decade in prison.
Prosecutors said the funds from old investors were used to pay new investors and to pay the operating expenses of RRA. Some of the expenses: "lavish gifts, including exotic automobiles, jewelry, boats, loans, cash and bonuses," and donations to "public and private charitable institutions, including hospitals."
Some of the items were for law firm employees.
Shannon is set to appear in federal court in Fort Lauderdale Tuesday.
In another chapter of this twisted story, Villega's estranged husband Tony Villegas is set to go to trial later this year.
He stands accused of killing Rothstein's former lover Melissa Britt Lewis, one of the law firm's partners.
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