Convicting 5, jury nixes Madoff claim he was alone

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NEW YORK (AP) — Imprisoned financier Bernard Madoff’s
claim that he carried out a nearly $20 billion fraud by himself has been
firmly rejected by a jury that convicted five of his former top
employees of all charges that they aided his crimes.
The verdict
Monday in federal court in Manhattan means more than a dozen people have
either pleaded guilty or been convicted of charges related to a mammoth
fraud Madoff engineered for decades before the economy’s 2008 collapse
exposed it for the record Ponzi scheme it was.
For more than five
months, jurors listened to dozens of witnesses and saw hundreds of
exhibits before convicting Madoff’s former secretary, his director of
operations, an account manager and two computer programmers of multiple
charges.
"The evidence was just overwhelming," juror Craig Parise
told reporters as he left the courthouse. As promised by prosecutors at
the trial’s start last October, evidence showed investors big and small
were swindled, from Florida retirees to celebrities such as Steven
Spielberg, actor Kevin Bacon and Hall of Fame pitcher Sandy Koufax. Even
Nobel Peace Prize winner and Holocaust survivor Elie Wiesel was
cheated.
"The list of Bernard Madoff’s victims now includes these
five former employees," said Andrew Frisch, attorney for Daniel
Bonventre. Bonventre testified in his defense that he was manipulated by
Madoff since 1968 just the same way his boss snookered the Securities
and Exchange Commission and top financiers on Wall Street as he rose to
be Nasdaq chairman.
Longtime Madoff secretary Annette Bongiorno
followed him to the witness stand, claiming she too was victimized by a
boss who charmed her for four decades even as he kept secret how he
managed to return double-digit growth in his clients’ accounts year
after year, in good times and bad.
She said Madoff told her they could make money in a down market by shorting stocks and she believed him.

Parise said the testimony by Bongiorno and Bonventre "did not help their cause."
Another
juror, Sheila Amata, said she hoped "this brings some level of closure"
to the victims. She added that the "facts spoke for themselves" in the
case and that Madoff, who is serving a 150-year prison sentence, "seemed
to have a split personality." Evidence showed him showering employees,
friends and some select customers with favors and riches while he
plundered the investment accounts of others.
Guilty verdicts were
returned on charges of conspiracy to defraud clients, securities fraud
and falsifying the books and records of a broker dealer, among others.
Maximum potential sentences range from 78 years to 220 years in prison,
but the actual sentences are likely to be far less. Sentencings were
scheduled for late July.
U.S. Attorney Preet Bharara said the
convictions, along with the prior guilty pleas of Madoff and eight other
defendants, demonstrate what prosecutors have believed since the early
stages of the investigation: "This largest-ever Ponzi scheme could not
have been the work of one person."
"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," Bharara said.
The trial, one of the longest in
Manhattan federal court history, was the first to result from the
massive fraud revealed in December 2008 when Madoff ran out of money
during the nation’s financial crisis and was arrested.
At a guilty plea three months later, Madoff insisted he acted alone before he was led away to prison.
In
the following months, prosecutors built their case against Bonventre,
67, Bongiorno, 66, account manager JoAnn Crupi, 53, and computer
programmers Jerome O’Hara, 51, and George Perez, 48. Since last October,
they’ve shown the jury the role each played in creating and mailing out
tens of thousands of phony monthly statements and trading confirmations
to make it look as if customers were making money in the market.
Madoff’s
thousands of victims included individuals, trusts, pension funds, hedge
funds and nonprofit organizations. The scheme wiped out people’s life
savings, ruined charities and foundations, and apparently pushed at
least two investors to commit suicide.
Clients lost nearly $20
billion. A court-appointed trustee has recovered much of the money by
forcing those customers who received big payouts from Madoff to return
them. When the fraud was revealed, Madoff admitted that the nearly $68
billion he claimed existed in accounts was only a few hundred million
dollars.
As the verdict was read, the defendants largely took the
verdicts in stride except for Crupi, who looked shocked when the first
guilty verdict was read and later shook her head.
U.S. District
Judge Laura Taylor Swain rejected requests that the defendants be
immediately detained. The defendants hugged family members. They
declined to comment as they passed reporters.
Attorney Eric Breslin, representing Crupi, said: "The name Madoff was a tall mountain to climb. I
think it’s just a fact."
One
case remains outstanding, that of a former senior tax partner at the
accounting firm Konigsberg Wolf & Co. who was charged with aiding
Madoff by directing others to falsify records to conceal his fraud.
The
centerpiece of the prosecution’s case was Frank DiPascali, Madoff’s
former finance chief, and five other insiders who pleaded guilty and
agreed to cooperate. He and others spoke often about Madoff, "Bernie" as
everyone called him, along with his relatives, including his brother,
wife and two sons. One of the sons committed suicide two years after the
fraud was revealed.
Defense lawyers in closing arguments insisted
their clients were victims, too, losing tens of millions of dollars
they had entrusted to their boss.
The verdict was delivered after
the jury deliberated for about 20 hours over a period of two weeks. The
panel was down to 11 jurors after one juror became sick during
deliberations and was dismissed.
The defendants were described by
prosecutors as "necessary players" in the fraud. They said Bongiorno,
hired in 1968, and Crupi, hired in 1983, used old stock tables to
fabricate account statements and other fake records that fooled the SEC.
The government said they also enjoyed tens of millions of dollars in
salaries and bonuses, including $2.5 million for a beach house for Crupi
as the Ponzi scheme was falling apart.
Prosecutors said O’Hara
and Perez developed a software program that automated the fraud,
generating "information out of thin air," as one put it.
Madoff, 75, is serving his sentence at a federal lockup in North Carolina.
___
Associated Press Writers Tom Hays and Jennifer Peltz contributed to this report.

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