TD Bank, a unit of Canadian banking giant TD Bank Financial Group, has been hit with a lawsuit arising out of an alleged Ponzi scheme by onetime Florida attorney Scott Rothstein.

Mr. Rothstein, who oversaw a prominent, 70-lawyer firm in Fort Lauderdale, allegedly sold investors stakes in legal settlements that he claimed his firm had negotiated in employment disputes, such as sexual-harassment and whistle-blower claims.

Mr. Rothstein sold settlements that never existed, according to the U.S. attorney's office in Miami, which filed a civil suit this month accusing Mr. Rothstein of perpetrating a Ponzi scheme. The Federal Bureau of Investigation has said that as much as $1 billion was invested in the venture.

Investors now are directing their ire at TD Bank. Mr. Rothstein deposited funds from investors in a TD branch in Fort Lauderdale.

In a suit filed Friday in Florida state court, parties who claim they invested about $105 million with Mr. Rothstein's venture allege that TD Bank was "complicit" in his venture. The bank, they allege, offered written assurances that funds deposited by investors would be released only to them directly.

Instead, the suit says, investors' bank deposits were depleted. The suit doesn't specify what happened to those deposits.

"The Ponzi scheme simply could not have gained traction without TD Bank's involvement," the plaintiffs say in the suit, which also names as defendants Mr. Rothstein, some employees of his law firm and some TD Bank employees.

A spokeswoman for TD Bank said Friday that the bank denied the claims in the suit and is cooperating with authorities in the investigation. "Through the legal process, the facts will prove that the bank did not conspire with Mr. Rothstein and/or his firm," she said.

Marc Nurik, an attorney for Mr. Rothstein, declined to comment about Mr. Rothstein's involvement in an alleged Ponzi scheme. He said it isn't surprising that Mr. Rothstein investors, in search of a "deep pocket," would file suit against the bank. "That is standard operating procedure to look into a bank's role in this," he says.

Separately, Mr. Rothstein volunteered to have his Florida law license revoked and the state bar association complied with his request Friday.

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