Lawyer allegedly contributed Ponzi funds

FORT LAUDERDALE, Fla., Dec. 3 (UPI) -- The Florida lawyer arrested on racketeering and fraud charges donated to political campaigns with funds from a $1.2 billion Ponzi scheme, prosecutors alleged.

Federal prosecutors said Scott Rothstein, arrested Tuesday, also once hosted 2008 Republican presidential nominee John McCain at his Las Olas Isles, Fla., home and contributed -- along with his wife -- $140,000 to the Arizona senator's campaign, The South Florida Sun Sentinel in Fort Lauderdale reported Thursday.

Federal prosecutors said Rothstein used his dissolved law firm Rothstein Rosenfeldt Adler, its employees and a network of corporations to hide the source of political contributions and to skirt legal limits on donations.

Rothstein's emergence as a big-time contributor was part of the scam, prosecutors alleged, because the appearance of power allowed him to meet potential affluent investors in his sham legal settlements he hawked.

"It was all done in order to promote the enterprise, the law firm, himself, to make it look legitimate, to give it an air of respectability so that investors and clients would invest," Jeffrey Sloman, acting U.S. attorney in South Florida, said Tuesday.

Rothstein finely wined and dined political heavyweights such as Govs. Arnold Schwarzenegger of California, Bobby Jindal of Louisiana and his own state's Charlie Crist, the newspaper said. Former President George W. Bush and McCain's running mate, former Alaska Gov. Sarah Palin, were recipients of his largesse as well.

A Sun Sentinel analysis of campaign contributions indicated Rothstein, his legal associates and their families donated at least $2.8 million since 2006. Rothstein and the law firm donated more than $1 million, while Rothstein's wife and parents contributed in excess of $200,000.