Seidelbaum was an undercover law enforcement officer who presented himself as a money launderer. Through unknown means Manny Ribera learned of Seidelbaum's (false) reputation as a banker. Tony had a falling out with Jerry (Banker), his original financial advisor, after Jerry raised his prices for laundering Tony's drug money when the profits of Tony's drug business expanded. Jerry was nonchalant about Tony's disagreement over the rate changes and warning he would withdraw his business, saying most offshore banks in the Caribbean are unreliable and/or in places of political unrest. Manny recommended Tony contact Seidelbaum, as his rates were lower than Jerry's. Tony agreed to such a meeting, and figured by name alone Seidelbaum must be a skilled money man. When they first met Seidelbaum established rapport with Tony by discussing Humphrey Bogart, a favorite subject of Tony's. Tony gave Seidelbaum $1.3 million in cash to convert into cashier's checks. Unknown to Tony or Manny, a wall clock had been modified to have a hidden camera which recorded Tony's actions. When the conversion was over, Seidelbaum exposed himself as a cop, showing his badge and serving Tony a warrant for tax evasion and money laundering.
After Seidelbaum arrested Tony, he said he would call his lawyer, George Sheffield, whom Tony claimed had the means to ruin Seidelbaum's career, or at least send him to Alaska, never to be heard from again. However, Tony underestimated the amount of trouble he was in and overestimated the extent of his political reach. Seidelbaum is not seen after the arrest, but it is apparent the charges were not dismissed as Tony is later meeting with Sheffield who says Tony has a forthcoming case in the United States Tax Court, and that he is staring down the barrel at three years' imprisonment as it is going to be difficult for Sheffield to convince the court that the money Tony gave Siedelbaum was acquired honestly.