Lawyers fired, Bank recants testimony after it is discovered that Bank altered document used at federal trial

May 07, 2012   

After being held liable for $67 million in damages by a federal jury for aiding and abetting the fraud committed by attorney Scott Rothstein and his law firm, Rothstein, Rosenfeldt & Adler, TD Bank, headquartered in Canada, may be sanctioned by a federal judge and its trial counsel held in contempt for altering a document used at trial and representing to the Court that other documents did not exist.

From 2005 to 2009 TD Bank was the banker for the Rothstein law firm, the accounts of which Rothstein used to execute a $1.2 billion Ponzi scheme. Victims of the scheme have brought civil suits against TD Bank and others for banking the Rothstein firm and otherwise complying with the Rothstein scheme.  Coquina Investments wasone of those victims and filed suit against TD Bank for fraud.

Coquina Investments, in its motion for sanctions, has asked Judge Cooke for monetary penalties, referral of the bank to the Justice Department for investigation, and referral of the Greenberg Traurig law firm to the Florida Bar for an ethics investigation.

Recently, TD Bank, in response to the motion for sanctions filed by Coquina Investments, seen here,

admitted to U.S. District Judge Marcia Cooke in Miami that a document used at trial had been altered, but blamed a copying error. That response is here.

The document was a “Customer Due Diligence form” that had been altered to hide the fact that Rothstein was considered a “high risk” client by TD Banks compliance department for money laundering activity. The document was important to the issues at trial, because TD Banks money laundering expert testified that the bank had no reason to believe that Rothstein was laundering money, when the document revealed that the exact opposite was true. Also, lawyers for the bank had represented to Judge Cooke that a document entitled “Standard Investigative Protocol,” outlining the steps taken by anti-money laundering officials of the Bank, did not exist, when it in fact did.  No reason was given for why neither TD Bank nor its counsel produced the document at trial. As a result, TD Bank recanted those representations to the Court, fired its trial counsel, and obtained new counsel. Judge Cooke has set a May 17th hearing to decide whether the bank should be sanctioned and its former lawyers held in contempt of court for making incorrect representations regarding the altered document.

Donna Evans, the Greenberg Traurig partner who represented the bank at trial made the misrepresentations to the Court, is apparently no longer with the firm.

This case highlights the importance of due diligence in reviewing corporate records when producing documents for discovery in a civil lawsuit, or for use otherwise as evidence.  The sanctions availableif documents are destroyed, altered or otherwise misrepresented to not exist include dismissal of lawsuits, striking of defenses, preclusion of the use of certain evidence, and monetary sanctions. Experienced counsel, like those at Fuerst Ittleman, are always on the lookout to make sure a clients records have been adequately searched before responding to requests for production of documents in a civil case.You can contact us by email at contact@fidjlaw.comor by calling us at 305.350.5690.