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Insurers for bank used by Ponzi schemer aren't liable for coverage

Insurance companies for a bank used in a $1.2 billion Ponzi scheme are exempted from covering $25 million of the bank's settlement, a federal appeals court has ruled.

By Greg Land | Updated on July 14, 2017
Multiple civil lawsuits in assorted courts also sprang from the collapse of the investment scheme. (Photo: Shutterstock)

Insurance companies for a bank used in a $1.2 billion Ponzi scheme are exempted from covering $25 million of the bank’s settlement with some of the parties, a federal appeals court has ruled.

The decision by the U.S. Court of Appeals for the Eleventh Circuit came more than seven years after high-flying Florida lawyer Scott Rothstein pleaded guilty to federal charges stemming from a scheme that defrauded hundreds of investors.

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