A Toronto-Dominion Bank (TD) lawyer falsely told a judge that a document didn’t exist when investors suing over convicted conman Scott Rothstein’s Ponzi scheme requested it, the bank’s attorneys said in a filing.
The bank this week produced the document, an internal bank record called a “Standard Investigative Protocol,” and told a judge that its attorney had previously given false information when she said it didn’t exist.
TD Bank also replaced the law firm, Greenberg Traurig LLP, which represented it during a January trial in which the bank was sued by investors who claimed it should have detected money laundering in accounts Rothstein held there. Jurors in Miami awarded the investors $67 million.
McGuireWoods LLP will now represent TD Bank in the lawsuit and in a related one, Rebecca Acevedo, a bank spokeswoman, said in a statement.
“TD and Greenberg Traurig decided it was in the best interest of all concerned that McGuireWoods represents TD,” Acevedo said.
During the January trial, one of the bank’s attorneys with Greenberg Traurig told U.S. District Judge Marcia G. Cooke that the bank didn’t have a “Standard Investigative Protocol,” according to a transcript of proceedings on Jan. 13. A TD Bank senior vice president also said in an affidavit that the document didn’t exist.
“We cannot comment directly about facts regarding our representation of a client, particularly a matter currently before the court,” Jill Perry, a spokeswoman for Greenberg Traurig, said yesterday in an e-mailed statement. “We are working to address this situation in a professional manner.”
David Mandel, attorney for the investors, declined to comment.
Separately, the investors, known collectively as the Coquina group, asked the judge last week to sanction the bank because a different document produced by the bank was altered before it was given to Coquina’s attorneys.
Cooke has scheduled a hearing for Greenberg Traurig to address the issue of the altered document and to show why its attorneys shouldn’t held in contempt for their statements about the protocol.
Rothstein, co-founder of the now-defunct Fort Lauderdale- based firm Rothstein, Rosenfeldt & Adler, is serving a 50-year sentence for conspiracy to commit fraud. Investigators say his $1.2 billion Ponzi scheme is the largest in Florida history. Rothstein sold investors stakes in sexual- and employment- discrimination cases that turned out to be non-existent.
After briefly fleeing the country when the scheme collapsed in October 2009, Rothstein has been cooperating with investigators. Eight associates have been accused of helping him defraud investors.
The case is Coquina Investments v. Rothstein, 10-cv-60786, U.S. District Court, Southern District of Florida (Miami).
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