Key co-conspirator in billion-dollar Rothstein Ponzi scheme now a public official in South Florida

Surfside planning and zoning board member Michael Szafranski with fellow board member Carolyn Baumel at a June 29 meeting. Photo: Bob Norman

By Bob Norman,

As an appointed member of Surfside’s planning and zoning board, Michael Szafranski is trusted to pass judgment on some of the most important issues involving the town. 

And as head of Florida acquisitions for the Kushner Companies, Szafranski makes decisions involving hundreds of millions of dollars worth of developments for former First Son-in-Law Jared Kushner’s family business. 

“We’re very proud to have Michael,” Kushner CEO Laurent Morali told the Florida Bulldog. “He does a great job for our company. We regard him as one of the most brilliant people in the industry. That’s kind of how we feel about Michael.”

But what about Szafranski’s notorious past as a convicted felon involved in the largest Ponzi scheme in Florida’s history? 

Eliana Salzhauer

“Anyone who makes a mistake, they pay a price,” said Morali. “They get sentenced. They go out [of prison], and once they go out, they start from scratch. I believe in the good of people.” 

The answer doesn’t cut it for former Surfside Commissioner Eliana Salzhauer, beginning with Morali’s use of the word “mistake.” 


“It wasn’t a mistake – it was a continuous fraud,” said Salzhauer. “It was a deliberate fraud that was perpetuated and had he never been caught he never would have been sorry and he would have continued doing it.”

Szafranski was a key player in the jaw-dropping $1.3-billion fraud perpetrated by Scott Rothstein, the audacious and high-rolling ex-Fort Lauderdale attorney now serving a 50-year prison term. In 2015, the 45-year-old Szafranski pleaded guilty to conspiracy to commit wire fraud and was sentenced to two and half years in prison, followed by three years of supervised release. 

He was barred by the Securities Exchange Commission from associating with stockbrokers and investment advisors and agreed to pay $6 million to the fraud victims. During a deposition in the Rothstein law firm’s bankruptcy case, Szafranski invoked the Fifth Amendment more than 1,000 times.

After a recent meeting of the planning and zoning board, to which Szafranski was appointed as an alternate and routinely sits as a voting member, he still wasn’t about to answer questions about his past crimes. But he told the Florida Bulldog that it’s time for everyone to get past his past. 

“It was something that gained a lot of attention in Fort Lauderdale 14 years ago, but I think you’ll find that most of us, or at least myself, don’t want to revisit it,” he said. “It was something that happened and I’ve worked very hard to rebuild my life and become a better person in society.”

To understand Szafranski’s role in Rothstein’s crime spree, it’s best to start with the telling nickname he was given by the Ponzi schemer. 

Michael Szafranski, right, with Scott Rothstein posing with Democrat Alex Sink during her unsuccessful 2010 run for governor.

Milk Toast.


In late 2009, Scott Rothstein was the king of Broward County, if not Florida. His Rothstein Rosenfeldt Adler (RRA) law firm had eclipsed 70 attorneys and he was driving a collection of high-end cars, buying up several multimillion-dollar homes and businesses, and pouring tens of millions of dollars into local real estate, businesses, charities and politicians’ coffers. 

He was one of then-Gov. Charlie Crist’s largest donors and closest confidantes, had multiple law enforcement officers on his payroll to do his dirty work, and the Fort Lauderdale police chief at the time, Franklin Adderley, was a friend who frequented Rothstein’s downtown restaurant, Bova Prime, on a nightly basis while his officers provided him special protection details. 

Kept secret was the fact that Rothstein was selling legal settlements to mostly wealthy investors, including shady New York hedge funds. He promised large returns on the investment that he paid out until the money ran out in November 2009. 

Rothstein fled to Morocco with the last $17 million but then returned to surrender to the FBI and cooperate with federal prosecutors. He explained that all the settlement agreements he sold in what was a $1.2-billion Ponzi scheme were all fake. He and 28 co-defendants, including Szafranski, would be sentenced to prison in the case, Rothstein himself to 50 years. 

But it was Szafranski, perhaps above all other Rothstein cohorts, who should have known better. He joined the scheme as a trusted “independent verifier” of the legal settlement agreements for hedge fund investors. 

Rothstein would later testify that Szafranski never seemed to care about upholding the trust of his position. He, of course, never truly verified any settlement agreements, which was impossible to do because they were not real. Rothstein said Szafranski never seemed interested in protecting investors and quickly nicknamed him “Milk Toast,” a play on the word milquetoast, because he knew he wouldn’t stand in the way of his criminal enterprise. 


“Milk Toast means like vanilla,” Rothstein explained during a deposition. “[Szafranski] doesn’t ask a lot of questions … he just kind of accepted things the way they were. Very vanilla. ‘Mike, this is the balance.’ ‘Okay, this is the balance.’ ‘Mike, these are the wires.’ ‘Okay, these are the wires.’ ‘Mike, these plaintiffs signed these documents.’ ‘Okay, the plaintiffs signed the documents.’ … He wasn’t very inquisitive.” 

Rothstein testified that Szafranski went from being a facilitator of his crimes to becoming a “part of the Ponzi scheme” itself. 

“It turned out that he was not only extremely malleable but was extremely greedy,” Rothstein testified about Szafranski. 

Debra Villegas, RRA’s office manager and a co-conspirator in the Ponzi scheme, said Szafranski “worshipped” Rothstein in such a slavish fashion that it gave her the “creeps.”

“Szafranski followed Scott around like a puppy dog,” she said. “He was just so pathetic.”  

Instead of diligently representing investors, he began to recruit them into Rothstein’s scheme using, according to the U.S. Department of Justice, “material misstatements and material omissions … designed to deceive investors.” 


He also secretly took millions of dollars from Rothstein while he was supposed to be representing investors’ interests as a check on the high rolling attorney, according to his indictment. 

All the while, emails show that “Milk Toast” was playing the obsequious servant to Rothstein, at one point referring to him as “master.” He continuously professed “love” for Rothstein and referred to himself as “Mikeyyy.” When the Ponzi scheme imploded and Rothstein fled to Morocco, Szafranski posted desperate emails to the fraudster. 

“Where are you,” he wrote in one email. “I am so worried. I want u back here. It is so hard for me knowing ur in a living hell. Tell me u closed ur deal and ur coming back today.”

Rothstein never returned to the law firm. After the story broke that he’d fled to Morocco with $17 million of investors’ funds, the law firm collapsed and all the homes, cars, businesses, and expensive toys were seized by the federal government. Eventually he returned and cooperated with the FBI, leading to one of the largest criminal investigations in Florida history. 

Szafranski would ultimately cooperate with the feds – and sobbed in court before he was led to prison.  


On the evening of Aug. 31, the man formerly known as Milk Toast was holding court at one of the more critical and controversial meetings of the Surfside Planning and Zoning Board – one approving the new luxury condo building at the site of the fallen Champlain Towers, where 98 people died in the tragic collapse.

Szafranski voiced his support of the project on the dais and decried the opponents of the plan – Salzhauer among them – as political opportunists trying to advance their political careers.

“I think exploiting victims is awful,” he told the packed room from the dais. “It should be avoided at all costs and I think those people that have these political ambitions should be ashamed of themselves.”

Salzhauer said that, considering Szafranski’s past, his moralizing on the bench was nothing short of “disgusting,” and she let him know that during a break at the meeting (during which the controversial development was approved by the board). 

Earlier last month, Szafranski posted a warning on social media about apparent thieves who tried to steal his bike from his porch. 

“Stealing is never OK,” Salzhauer wrote in a comment on his post. “Whether it’s a bicycle or investors’ savings.” 


She said she doesn’t begrudge Szafranski moving on from his criminal conviction but doesn’t believe he should be in a position of public trust, likening his appointment to the town board to “hiring a pedophile as a babysitter.”  

“We have a lot of applicants that are honorable and honest and who aren’t convicted felons,” said Salzhauer. “People can have fresh starts, but somebody like him does not belong on the P and Z board. This is a discretionary position of enormous power that should not go to someone with a track record of criminal behavior.”

A key to Szafranski’s resurgence in Surfside was his continued good standing at Young Israel of Bal Harbour, a nearby synagogue. Among the investors Szafranski recruited into the Rothstein Ponzi were some members of Young Israel, where he served a formal role as a gabbai, assisting in Torah readings. 

Despite the fact that some of its congregants had been betrayed and financially wounded, the synagogue stood by Szafranski, and he continues to serve as a gabbai there today. 

Young Israel of Bal Harbour also happens to have two very famous – or infamous, depending on one’s point of view – members: Jared and Ivanka Kushner. The couple took up residence in Surfside after their controversial stints in the White House. 

Neither Szafranski nor Kushner CEO Morali would comment about the circumstances of his hiring at the company. Szafranski’s LinkedIn account shows Kushner Companies initially took him on in February 2019. In July 2019, the SEC cut him a break and ended his ban on dealing with municipal securities dealers. Kushner promoted him to Director of Florida Acquisitions in December 2020. 

It was last year that newly elected Vice Mayor Jeff Rose appointed Szafranski to the city board. Rose is a construction contractor in the town. Might Rose want a malleable presence on the board that determines what can and can’t be built in his town? 

The question wasn’t answered. When asked about the Szafranski appointment on the phone, Rose hesitated for just a moment before making his reply. 

“No comment,” he said. 

(Bob Norman is news director for the Florida Center for Government Accountability.)

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Latest comments

  • Seems to be a conflict of interest. Also did Trump or Kushner have anything to do with the SEC giving Szafranski a break because they were both in the Whitehouse at the time. I find it odd that they gave him a break because of the crime of scamming investors. Also did the synagogue give him a break because of Kushner??

  • Must have been a slow decade for Mr Norman because he hasn’t written an interesting story since he chronicled the Rothstein saga back in 2008.

    Bob, if anyone in Surfside cared about Eliana Salzhauer’s opinion they would have re-elected her to office, but with all the innuendo and half-truths in your article you failed to mention that her election defeat was a repudiation of the noxious, Trump-like toxicity she brings to every discourse.

  • Did “Milk Toast” pay the 6M owed to the crime victims? I think the answer would tell us a lot about the worth of this man.

  • The real question is how can Surfside have a convicted felon on the P&Z board. Someone needs to look at their charter and vote out the person who appointed him. Residents in Surfside should be up in arms!!

  • LEE PANGRILLE you only wish you could be half the reporter Bob Norman has been for this community. Crawl back in your hole where you deserve to live. That’s right go after the person shining a light and corruption…just makes you look stupid and equally corrupt!

  • Has the “Milk Toast” saga really surprised anyone? It shouldn’t! After all, this south Florida, where we manufacture crooked politicians, prejudiced, corrupt judges and dishonest, unethical, self-serving lawyers…like Scott Rothstein, whom I once met at a party in Fort Lauderdale. I was the DJ. In my opinion. Rothstein was a F@#KING GENIUS in how he set up his Ponzi scheme! Selling FAKE settlement agreements to greedy, witless investors was brilliant! Here’s why… Rothstein, as a lawyer, knew that REAL settlement agreements always have a binding “confidentiality” clause included in the terms of the settlement. See where this is going? If an investor ever wanted to SEE a copy of the (fake) settlement agreement, Rothstein could, and likely did, use the “confidentiality” clause as a reason NOT to show it to the investor. Clever! And it probably WORKED for a long time! It’s ironic though, Rothstein got 50 years in prison, while “Milk Toast,” who was EQUALLY as guilty, got only 2.5 years! Rothstein will likely DIE in prison while Milk Toast is now leading the good life! In Florida, being a felony-convicted ex-con apparently does NOT stop anyone from being given a position of authority in the local city government! A well-paying position, no less!

    And by the way, Scott Rothstein was NOT the great a karaoke singer he fancied himself to be! For “diplomatic” reasons, I let him sing “American Pie” at the party. His ambition far exceeded his talent! Too much alcohol, (or something), before “taking the stage!”

    On a different but related subject, years ago during litigation, I encountered the most dishonest, unethical, self-serving, crooked lawyer ever to DISGRACE the legal profession! Before filing a Bar Complaint, I thoroughly investigated his background and was AMAZED by what I found! His name is Richard G. Chosid, Bar No. 13432 and he has a criminal and disciplinary habitual offender rap sheet a mile long! Convicted felon, ex-con, tax evader, drug smuggler, bankruptcy fraudster, etc. etc. etc. He served two years in prison, but got his law license back after his release. Currently, Richard G. Chosid is serving ANOTHER six month suspension! I didn’t think it was possible for a felony-convicted, ex-con to be an “Officer of the Court” so I began a “research project.” I even got some help from the Florida Bar itself in identifying how many OTHER felony-convicted lawyers were practicing law in Florida with reinstated law licenses. I was stunned by the results! Since the 1960’s, the number was somewhere between 700 to 800 lawyers! WTF!!! I have their names, Bar numbers, dates of conviction, prison sentences, if any, and in some cases, specific details of what they were convicted of! About a dozen of them are even Two-Time Losers! Of course, many of them are no longer practicing, having died or retired, but many of them are still active. The Florida Bar has BETRAYED the public trust for DECADES!!! (Emphasis added).

  • Pangrille- What a turd you have to be to condone this behavior. This area has become a filthy cesspool for people with the most rotten backgrounds and clearly you not only support them but identify with them as well. In case you are a little slow. Your position of supporting the dark side and condemning those that are trying to keep the scum level at bay is nothing to be proud of. Im sure your mother is proud.

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