(New throughout, adds comment from jurors, comment from defense
lawyers, details from trial)
By Joseph Ax
NEW YORK, March 24 (Reuters) - Five former aides to
investment manager Bernard Madoff were convicted on Monday of
charges that they helped their boss conceal his
multibillion-dollar Ponzi scheme for years.
A federal jury in New York found back-office director Daniel
Bonventre, portfolio managers Annette Bongiorno and Joann Crupi,
and computer programmers Jerome O'Hara and George Perez guilty
on all counts, including securities fraud and conspiracy to
defraud clients.
The trial lasted more than five months. The five defendants
will be sentenced in late July.
"These five defendants played crucial roles in constructing
and maintaining the house of cards that was the Madoff
investment fraud," U.S. Attorney Preet Bharara said in a
statement. "The scheme these defendants helped perpetrate cost
innumerable investors their life savings. Now it likely will
cost the defendants their freedom."
Madoff, 75, is serving a 150-year-prison sentence after
pleading guilty in March 2009 to charges stemming from a Ponzi
scheme that is estimated to have cost investors more than $17
billion of principal. He was arrested in December 2008.
Nine other people have pleaded guilty in connection with
Madoff's fraud, some of whom testified at the trial as
cooperating government witnesses.
As the verdict was read in court, there was no visible
reaction from the defendants, who faced among them a total of 31
counts from securities fraud to tax evasion.
"The list of Bernard Madoff's victims now includes these
five former employees," Andrew Frisch, a lawyer for Bonventre,
said after the verdict, adding that he plans to appeal.
At the trial, prosecutors introduced as evidence thousands
of pages of internal documents seized from Madoff's investment
firm and called dozens of witnesses.
Madoff's right-hand man, Frank DiPascali, testified as part
of a plea deal with the government and implicated each of the
five defendants in the fraud. Defense lawyers urged the jury to
disregard his testimony, calling him an inveterate liar
desperate to avoid a lifelong prison term.
But several jurors interviewed after the verdict said they
found DiPascali credible.
"It was pretty captivating," said Sheila Amato, an art
teacher.
Jurors scoffed at the testimony of Bongiorno and Bonventre,
who surprised trail watchers by taking the stand in their own
defense and denying knowing about any fraud.
"They should be embarrassed," said Nancy Goldberg, an
instructional assistant for at-risk public school students. She
said their testimony was simply not believable.
While there was little dispute that various defendants
engaged in activities such as backdating fake trades and
creating false documents, the case turned on whether they knew
at the time that they were aiding Madoff's fraud.
The defendants had said Madoff duped them into becoming
unwitting accomplices. Madoff, they said, created silos inside
the firm to ensure that no aide could see the entire picture and
used his considerable charm to keep them in the dark.
"Why wouldn't she believe him?" Roland Riopelle, the lawyer
for Bongiorno, said during his closing argument, arguing that
Madoff convinced her that backdating trades was allowed. "He was
the head of the firm and the chairman of NASDAQ. She was by
design, by Mr. Madoff's design, living in her own little
bubble."
But prosecutors pointed to reams of documents, many
featuring handwritten notes from the defendants, as clear
evidence the defendants knew what was happening.
"The notion that these defendants didn't know the trading
was fake is an absurdity," Assistant U.S. Attorney Randall
Jackson said at the end of the trial.
Asked whether the defense could have anything differently,
Eric Breslin, a lawyer for Crupi, said, "Madoff was a tall
mountain to climb."
The case is U.S. v. O'Hara et al, U.S. District Court,
Southern District of New York, No. 10-cr-00228.
(Reporting by Joseph Ax; Additional reporting by Nate Raymond
and Jonathan Stempel; Editing by Dan Grebler and David Gregorio)
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