Tags: Madoff | enabler | brother | jail

Madoff's 'Enabler' Brother Pleads Guilty, Faces 10 Years Jail

Friday, 29 Jun 2012 04:56 PM

 

Share:
  Comment  |
   Contact Us  |
  Print  
|  A   A  
  Copy Shortlink
Bernard Madoff's younger brother pleaded guilty to criminal charges that he helped advance the multibillion-dollar Ponzi scheme, but denied knowing about the epic, decades-long fraud.

With his guilty plea in Manhattan federal court on Friday, Peter Madoff is the first of Bernard Madoff's family members to admit criminal wrongdoing at the investment advisory firm.

"I truly believed that my brother was a brilliant securities trader," Peter Madoff told U.S. District Judge Laura Taylor Swain in a courtroom filled to capacity. "At no time did I suspect that my brother had stolen from anyone."

Peter Madoff, 66, had been chief compliance officer at Bernard L. Madoff Investment Securities LLC. He said Friday that he did not know the business was a sham until Bernard Madoff confessed to him in December 2008.

Dressed in a brown suit, Peter Madoff stood at the defense table and read for 15 minutes from typed notes, his voice breaking at times.

"I want to apologize to anyone who was harmed and to my family," Madoff said. He explained that he had always worshipped his brother, and was "shocked" when Bernard revealed that the firm, which had been the envy of Wall Street, had been a massive hoax all along.

Peter Madoff will be sentenced on Oct. 4, and has agreed to accept a 10-year prison term. He was also ordered to forfeit a symbolic $143.1 billion and was released on a $5 million bond.

Bernard Madoff, 74, is serving a 150-year prison term and was ordered to forfeit $170.8 billion.

About a dozen people have been charged in connection with Madoff's Ponzi scheme. Manhattan U.S. Attorney Preet Bharara in a statement suggested that prosecutors may not be finished.

"Peter Madoff enabled the largest fraud in human history," Bharara said. "He will now be jailed well into old age, and he will forfeit virtually every penny he has. We are not yet finished calling to account everyone responsible for the epic fraud of Bernard Madoff and the epic pain of his many victims."

Prosecutors have not said whether they are preparing criminal cases against Bernard Madoff's son, Andrew, who was co-director of trading, or his niece, Shana, who was a compliance officer at the firm.

Five people implicated in criminal wrongdoing at Madoff's firm have pleaded not guilty.

Frank DiPascali, the firm's former chief financial officer, has been cooperating with the government since his plea nearly three years ago.

At Friday's court hearing, Peter Madoff, who had worked for his brother since 1965, said he had falsified papers for a series of money transfers, but claimed to have believed the money itself was legitimate. He also confessed to a litany of violations relating to maintaining the firm's books and records.

He said he had lied when certifying that he had conducted a thorough review of the firm's compliance with regulations.

"I made no effort to conduct a meaningful compliance review," he said.

 

The FBI called Peter Madoff one of the "chief architects" of his older brother's Ponzi scheme, which was uncovered when Bernard Madoff was arrested on Dec. 11, 2008.

"Peter Madoff played an essential enabling role in the largest investment fraud in U.S. history," FBI Assistant Director Janice Fedarcyk said in a statement. "He made a pretense of compliance. He was really about complicity."

Peter Madoff was arrested at his lawyer's office on Friday morning, FBI spokesman Peter Donald said.

The U.S. Securities and Exchange Commission has also filed a lawsuit against Peter Madoff, the regulator said on Friday.

He still faces a lawsuit by Irving Picard, the trustee seeking money for victims of the Ponzi scheme, who has sued Peter Madoff and other family members for $255.3 million.

The trustee charges that the family members should have detected Bernard Madoff's Ponzi scheme at the firm that operated "as if it were their family piggy bank."

Picard sued Andrew Madoff; the estate of son Mark, co-director of trading who committed suicide in December 2010; and Shana Madoff.

Lawyers for Andrew and Shana Madoff did not immediately return calls seeking comment.

The trustee has described Peter Madoff as a savvy investor who was once vice chairman of the Financial Industry Regulatory Authority's board of governors.

Between 1998 and 2008, Peter Madoff received more than $40 million in salary and bonuses, federal prosecutor Lisa Baroni said in court on Friday. Picard has said the firm funded Peter Madoff's lavish lifestyle, including a $140,000 Ferrari and a home on Manhattan's upscale Park Avenue.

Picard has estimated customers of the Madoff firm lost about $20 billion. On Monday, the U.S. Supreme Court let stand a lower court ruling on the trustee's methods for calculating losses. That decision could help Picard repay customers faster.

© 2014 Thomson/Reuters. All rights reserved.

Share:
  Comment  |
   Contact Us  |
  Print  
  Copy Shortlink
Around the Web
Join the Newsmax Community
Please review Community Guidelines before posting a comment.
>> Register to share your comments with the community.
>> Login if you are already a member.
blog comments powered by Disqus
 
Email:
Retype Email:
Country
Zip Code:
Privacy: We never share your email.
 
Hot Topics
Follow Newsmax
Like us
on Facebook
Follow us
on Twitter
Add us
on Google Plus
Around the Web
Top Stories
You May Also Like

Cameron: We'll Seize Passports to Fight Jihadists

Monday, 01 Sep 2014 15:00 PM

British Prime Minister David Cameron said he will force airlines to share flight-lists with security services and give p . . .

While Obama Ponders ISIS Action, UK's David Cameron Takes Charge

Monday, 01 Sep 2014 12:15 PM

While Great Britain's Prime Minister David Cameron cut his vacation short to deal with the Islamic State (ISIS) crisis,  . . .

Sen. Mike Lee Pleads: Abolish Common Core

Monday, 01 Sep 2014 12:52 PM

Sen. Mike Lee has called on Americans to join him in the effort to abolish the federal Common Core education standards i . . .

Most Commented

Newsmax, Moneynews, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, NewsmaxWorld, NewsmaxHealth, are trademarks of Newsmax Media, Inc.

 
NEWSMAX.COM
America's News Page
©  Newsmax Media, Inc.
All Rights Reserved