FBI probes potential billion dollar Ponzi scheme

The FBI is investigating a prominent Florida lawyer suspected of organizing a Ponzi scheme that may have defrauded investors of more than a billion dollars, the agency said.

Scott Rothstein, a 47-year-old lawyer from Fort Lauderdale, Florida, was the main target of the probe into a scheme similar to one carried out by Bernard Madoff in New York, agency officials said Thursday.

"I estimate that this scheme could well exceed one billion dollars," John Gillies, the agent in charge of the FBI's Miami office, said at a news conference here.

In Ponzi schemes, investors typically are lured by an appearance of high returns to put money into a fund or some other investment. New money coming into the fund is used to sustain the returns until the scheme collapses of its own weight.

The FBI and the Internal Revenue Service issued a statement asking investors in Rothstein Structured Settlement Investment or others with pertinent information to come forward in order to establish the scope of the fraud.

Rothstein admitted in a television interview this week to have made "a very serious mistake" and that he was prepared to compensate investors.

No formal charges have been filed against Rothstein.

Asked whether he posed a flight risk, Gillies said, "He can run but he can't hide."