5 Former Madoff Aides Found Guilty of Fraud
By RACHEL ABRAMS
Lucas Jackson/ReutersJoann Crupi, a former employee of Bernard Madoff.A federal jury on Monday found five associates of the convicted swindler Bernard L. Madoff guilty on 31 counts of aiding one of the largest Ponzi schemes in history.
The case centered around whether or not the employees had committed securities fraud and other deceptive acts to knowingly mislead auditors and investors in Madoff Securities. The trial in the United States District Court in Manhattan went on for more than five months, making it one of the longest white-collar trials in recent memory.
Federal prosecutors made a case that two computer engineers, Jerome O’Hara and George Perez, helped Mr. Madoff pull off an enormous Ponzi scheme by knowingly creating computer programs that could create fake trades and records.
Prosecutors also alleged that Mr. Madoff’s portfolio managers Joann Crupi and Annette Bongiorno as well as the firm’s operations director, Daniel Bonventre, conspired in various ways to lie to customers, cheat on taxes and falsify records at Madoff Securities.
“These convictions, along with the prior guilty pleas of nine other defendants, demonstrate what we have believed from the earliest stages of the investigation: this largest-ever Ponzi scheme could not have been the work of one person,” said Preet Bharara, the United States attorney in Manhattan, whose office brought the case. “The trial established that the Madoff fraud began at least as far back as the early 1970s, decades before it came to light,” he said. “These defendants each played an important role in carrying out the charade, propping it up, and concealing it from regulators, auditors, taxing authorities, lenders, and investors.”
While lawyers for the defense claimed that their clients did not knowingly participate in any of the deception, prosecutors made the case that the defendants were well aware of the fraud taking place at Mr. Madoff’s firm. That included the knowledge, for example, that Mr. Madoff’s firm was providing a “second set of books and records” to the Securities and Exchange Commission.
The prosecution’s case centered around the testimony of Frank DiPascali, Mr. Madoff’s right-hand man who pleaded guilty in 2009. Mr. DiPascali has been cooperating with federal prosecutors in a bid for a more lenient sentence. He is currently facing up to 125 years in prison. Lawyers for the five former employees had argued that Mr. DiPascali’s self-interest undermined his credibility.
The prosecution’s case centered around the testimony of Frank DiPascali, Mr. Madoff’s right-hand man who pleaded guilty in 2009. Mr. DiPascali has been cooperating with federal prosecutors in a bid for a more lenient sentence. He is currently facing up to 125 years in prison. Lawyers for the five former employees had argued that Mr. DiPascali’s self-interest undermined his credibility.
Madoff Securities collapsed in 2008 after Mr. Madoff confessed to the Ponzi scheme. He is currently serving 150 years in prison.
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