Madoff aides used 'avalanche of lies' to hide fraud: prosecutor

Tue Mar 4, 2014 5:52pm EST
 
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By Joseph Ax

NEW YORK (Reuters) - Five former aides of infamous swindler Bernard Madoff used an "avalanche of lies" to help him carry out his decades-long Ponzi scheme, each with a specific role to ensure that investors, auditors and regulators were kept in the dark, a prosecutor said on Tuesday in the closing phase of their trial.

Portfolio managers Annette Bongiorno and Joann Crupi, computer programmers Jerome O'Hara and George Perez and back-office director Daniel Bonventre spent years hiding the fraud from the outside world while collecting millions of dollars in salary and perks, Assistant U.S. Attorney John Zach told jurors.

"Day after day, year after year, these defendants pulled off an avalanche of different lies that enabled Madoff Securities to steal billions of dollars from investors," said Zach, whose closing argument in the five-month-long trial was expected to last much of Wednesday as well.

Madoff's worldwide fraud cost his clients an estimated $17 billion in principal losses. Madoff, who said he acted alone, was arrested in December 2008 and pleaded guilty in March 2009. He is serving a 150-year prison sentence.

The five former employees say they were duped by Madoff into believing his investment advisory business was legitimate. Their lawyers will deliver closing arguments after the prosecution.

On Tuesday, the prosecutor discussed the specific allegations against each defendant in turn.

He focused his attention first on Bonventre and Bongiorno, two of the earliest employees at Bernard L. Madoff Investment Securities LLC, who both chose to testify in their own defense during the trial.

Bonventre was in charge of overseeing the firm's general ledger, as well as the bank account that was the "beating heart" of the fraud, Zach said, and siphoned money from the account to prop up the firm's failing brokerage business.   Continued...

 
Bernie Madoff's former secretary, Annette Bongiorno departs Manhattan Federal Court in the Manhattan Borough of New York February 24, 2014. REUTERS/Carlo Allegri