As Scott Rothstein was hiding in Morocco from anxious investors last October, he exchanged a series of desperate e-mails with a financial adviser as his $1.2 billion fraud scheme was blowing up.
The e-mail exchange with Michael Szafranski, a Miami-Dade financial adviser who also funneled investors to Rothstein, provides a glimpse into Rothstein's frantic, final Ponzi days as investors sought payments that were not forthcoming.
The e-mails, included as part of a court filing Thursday in a lawsuit against Rothstein and other defendants, begin on the day Rothstein fled Fort Lauderdale. They contain misspellings and abbreviations.
At 12:43 p.m. Tuesday, Oct. 27, Szafranski sent an e-mail to Rothstein with the subject line "George Levin" — a Fort Lauderdale businessman who invested $775 million with Rothstein through his Banyon funds, according to bankruptcy records.
"Just called me
First time ever
That means he annoyed," Szafranski wrote.
Then at 4:36 p.m. Szafranski sent Rothstein another e-mail that set Rothstein off: "Barrie is close to calling Spinoza."
The e-mail exchange apparently refers to Philadelphia money manager Barry Bekkedam and a former TD Bank executive, Frank Spinosa.
Bekkedam helped structure some of the investments with Rothstein, according to investment documents, and his clients reportedly lost $30 million when the Ponzi scheme collapsed. Spinosa handled Rothstein's investor trust accounts and was fired from the bank in the fall.
"If he calls spinoza I will crush him.....he can not call him," Rothstein shot back a few minutes later.
Szafranski had an office in the same downtown Fort Lauderdale high-rise that housed Rothstein's law firm. He replied within two minutes: "I'm walking up the man wants his 5mm! Tell him [w]hen he can have it."
That Tuesday night, Rothstein boarded a chartered Gulfstream jet for Morocco. He told some associates he was going to London to meet new investors.
Szafranski's attorney, Christopher Berga, said in a statement to the Sun Sentinel that "the e-mails, read from beginning to end, show the truth: that Szafranski was another victim of Rothstein's deception until the very end."
Two days after Rothstein left the country, there was a flurry of e-mails, beginning at 8:06 a.m. "Need that letter asap. Melly needs it to keep his partners at bay," Szafranski wrote, an apparent reference to Mel Lifshitz, a former New York securities lawyer.
"At bay??? I am in the s--- rescuing everyone......
I need chill
I did not cause this.
I will get letter when I can log on.
Been back in with funders since 3 am your time.
Me," Rothstein replied.
Lifshitz apparently was threatening legal action.
Szafranski responded, "I don't wanna pressure u but if melly does what his partners want him to do then there a[re] bigger prbs. Plz call him.
Also I am debating whether to make any disclosures to my little ppl bc they will freak if pmts are late so I am scrambling for a loan.
Love you. Can't wait to see you.
Szafranski later sent, at Rothstein's request, a summary showing the hundreds of millions of dollars invested with Rothstein by various groups and how much they were paid back. Szafranski had pooled investors of his own and wrote to Rothstein that he was in trouble: "they will destroy me if I lose them $$, begging you."
The two men spent Thursday and Friday coming up with strategies to stave off investors, and trying to figure out how much money was owed. "Make it simple for these idiots," Rothstein instructed. "These idiots and I are not speaking same language."
Szafranski urged Rothstein to call "Ira," an apparent reference to Miami investment adviser Ira Sochet, who put in $147 million.
Rothstein said he was going to personally pay $2.5 million to one investment group, "so they have no loss…so barrie shuts up."
Szafranski had a different idea: "Hmmmm hold. Off. He will t[e]ll ira. I'd rather you pay me off part of it to get me through any rough patch. Besides barrie will not settle so no point."
"F--- him," Rothstein responded.
Early Friday morning, Szafranski asked Rothstein for a loan to make scheduled payments to his investors: "I don't want to have to give them the explanation and they will freak if payments are not sent. i will repay you or the oper acct when we resume but I need this..... i don't want my clients to go crazy over such a small dollar a[m]t."
Rothstein told him he would handle it, and Szafranski replied:
"Thank u soo much scott.
Where are you. I am so worried.
I want u back here. It is so hard for me knowing ur in a living hell.
Tell me u closed ur deal and ur coming back today."
At 6 p.m. Friday, Szafranski wrote the last of the e-mails contained in the court filing, "I have spoken to melly. He is planning on meeting with florida counsel on sunday and going into court on monday morning. He will be going after you, the firm. Everything. I was not able to dissuade him."
He went on to explain that if Rothstein could produce $37 million he could buy a "few weeks," and that Levin was considering buying out other investors: "banyon is open to taking everyone out."
"Please make this happen or we are all done."
Peter Franceschina can be reached at pfranceschina@SunSentinel.com or 954-459-2255.